SEBI levies ₹1 crore fine on Anil Ambani's son in Reliance Home Finance case

The Securities and Exchange Board of India (SEBI) on Monday imposed a ₹1 crore penalty on Jai Anmol Ambani, son of industrialist Anil Ambani, for failing to exercise due diligence in approving General Purpose Corporate Loans (GPCLs) while serving as a non-executive director of Reliance Home Finance Ltd (RHFL). [In the matter of Reliance Home Finance Limited].Jai Ambani's role in the broader Reliance ADAG group, to which these funds were lent onward, was also scrutinised. SEBI found that he did not exercise reasonable oversight in these transactions.In addition to the penalty on Jai Ambani, SEBI levied a ₹15 lakh fine on Krishnan Gopalakrishnan, the former Chief Risk Officer of RHFL, for his role in the loan approvals..Both of them were found in violation of SEBI’s Listing Obligations and Disclosure Requirements (LODR) and were directed to pay their fines within 45 days.This action follows SEBI's decision last month to bar Anil Ambani and 24 others from the securities market for five years for diverting funds from Reliance Home Finance. SEBI had also fined Anil Ambani ₹25 crore for his involvement in the fund diversion..The order, issued by SEBI’s Adjudicating Officer Barnali Mukherjee, found that Jai Anmol Ambani had approved loans to promoter-related entities without proper oversight or diligence, violating multiple provisions of the SEBI (LODR) Regulations.The order emphasised that although Jai Ambani held the position of non-executive director at RHFL, evidence showed he was actively involved in day-to-day decision-making at the company. During the investigation, emails revealed that Jai Ambani had given explicit approvals for unsecured loans of ₹20 crore each to Visa Capital Partners and Accura Productions Private Limited, despite the Board of Directors' earlier instruction to halt further loans..The regulator highlighted specific instances, including an email sent on May 17, 2018, requesting Jai Ambani's approval for a ₹20 crore unsecured loan to Visa Capital Partners, to which he replied, "Okay." A similar instance occurred on February 14, 2019, when he approved a ₹20 crore loan to Accura Productions Private Limited, despite the Board’s directive on February 11, 2019, to cease issuing GPCL loans.“Thus, it is observed that Noticee 1(Jai Anmol Ambani), being a non-executive director, has not acted in good faith, with due diligence and care, and in the best interest of RHFL and its shareholders, and has not maintained high ethical standards. He has also not ensured that appropriate systems for risk management and internal controls are in place,” SEBI's order stated. .The regulator added that, contrary to Jai Ambani’s defense, he was actively involved in loan approvals, including those to promoter-related entities, and played a significant role in RHFL’s day-to-day affairs.In conclusion, SEBI noted that his actions violated key provisions of the SEBI (LODR) Regulations, 2015, which require board members to act with diligence and in the best interest of the company and its shareholders..[Read Order]