Two Former Reliance ADAG CEOs Arrested by CBI in Corruption Cases

India's Central Bureau of Investigation (CBI) has arrested two former chief executive officers from Reliance ADAG companies as part of ongoing corruption investigations.

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Investigation has revealed that Devang Mody, who served as CEO of RCFL from April 2017 to December 2018, was a key decision-maker responsible for managing the operations of the company. He approved loans to intermediary and conduit companies despite being aware that such lending was contrary to RBI guidelines and the sanction conditions governing borrowings from PSBs.

The arrested individuals are Devang Mody, former director and CEO of Reliance Commercial Finance Limited (RCFL), and Ravindra Sudhalkar, former executive director and CEO of Reliance Home Finance Limited (RHFL). The CBI stated that these arrests are linked to corruption cases that have led to significant financial losses for public sector banks.

According to the CBI's statement, the RCFL case involves a loss of ₹4,097 crore to 13 public sector banks, while the RHFL case resulted in a loss of ₹3,526 crore to 10 public sector banks. The agency's probe indicates that Mody, who led RCFL from April 2017 to December 2018, approved loans to intermediary companies despite knowing these actions violated Reserve Bank of India (RBI) guidelines and sanction conditions.

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Ravindra Sudhalkar, the CBI statement said , “served as ED and CEO of RHFL during the period from October 2016 to March 2022. He was a key decision-maker responsible for managing the operations of Reliance Home Finance Limited (RHFL). He approved loans to intermediary and conduit companies despite such lending being contrary to the company’s lending policies, NHB/RBI guidelines and the conditions governing borrowings from PSBs”.

Similarly, Sudhalkar, who served as ED and CEO of RHFL from October 2016 to March 2022, is accused of approving loans contrary to the company's policies, National Housing Bank (NHB)/RBI guidelines, and borrowing conditions from public sector banks. The CBI further revealed that the accused allegedly diverted funds borrowed by RCFL and RHFL to other Reliance ADAG group companies, including Reliance Capital Ltd., Reliance Infrastructure Ltd., and Reliance Power Ltd. This alleged diversion caused a combined wrongful loss of ₹7,623 crore to the lending banks, with corresponding wrongful gains for themselves and related entities.

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the accused persons diverted funds borrowed by RCFL and RHFL to Reliance ADA Group companies, including Reliance Capital Ltd., Reliance Infrastructure Ltd. and Reliance Power Ltd., thereby causing combined wrongful loss 7,623 crores to the lending banks and corresponding wrongful gain to themselves and related entities.