Sebi fines Anmol Ambani Rs 1 crore for lapses in Reliance Home Finance case

Sebi also fined Krishnan Gopalakrishnan, the Chief Risk Officer of Reliance Housing Finance, Rs 15 lakh.

In Short

• Sebi fines Anmol Ambani Rs 1 crore
• Fines to be paid within 45 days
• Anmol approved loans against board's directive

The Securities and Exchange Board of India (Sebi) on Monday imposed a Rs 1 crore penalty on Anmol Ambani, son of industrialist Anil Ambani, for failing to follow due diligence while approving corporate loans in the Reliance Home Finance case.

Sebi also fined Krishnan Gopalakrishnan, the Chief Risk Officer of Reliance Housing Finance, Rs 15 lakh.

Both Anmol Ambani and Krishnan Gopalakrishnan have been ordered to pay their respective fines within 45 days, according to Sebi's official notice.

The Sebi order follows its previous action in August, when it barred Anil Ambani and 24 others from accessing the securities market for five years. This was part of a larger investigation into the diversion of funds from Reliance Home Finance Ltd. At that time, Anil Ambani was also hit with a hefty Rs 25 crore fine.

In its latest findings, Sebi stated that Anmol Ambani, who served on the board of Reliance Home Finance, approved loans labelled as "general-purpose corporate loans" (GPCL) despite a clear directive from the company’s board to halt such loan approvals.

Sebi's investigation uncovered that on February 14, 2019, Anmol Ambani approved a Rs 20 crore loan to Accura Productions Private Limited.

This decision came just three days after the board of directors, in a meeting held on February 11, 2019, instructed the management to stop issuing any further GPCL loans. Sebi noted that Anmol had acted contrary to these instructions, taking the company in a different direction than the board had intended.

In its order, Sebi criticised Anmol Ambani for overstepping his role as a non-executive director.

"The noticee 1 (Anmol Ambani) has taken the company in his own direction and has gone overboard in his role as director. He has not acted in the interest of the shareholders, nor with due care and diligence, and has failed to maintain high ethical standards," said Sebi.

The investigation also found that Anmol Ambani, who held positions in other companies within the Reliance ADAG group, including Reliance Capital and Reliance Home Finance, did not perform proper due diligence in the approval of GPCL loans.

These loans were onward lent to other Reliance ADAG companies, including Reliance Capital, without necessary oversight.

Krishnan Gopalakrishnan, as the Chief Risk Officer of Reliance Housing Finance, was also found to have played a part in approving various GPCL loans. According to Sebi, Gopalakrishnan was aware of the deviations in the credit approval memos of several loans that he had recommended during his tenure.

Sebi pointed out that Gopalakrishnan, being part of the senior management, should have followed the due process more rigorously. He should have adhered to the company's code of conduct and acted in the best interests of all stakeholders, Sebi added.

Both Anmol Ambani and Krishnan Gopalakrishnan were found to have violated Sebi’s Listing Obligations and Disclosure Requirement (LODR) rules. \