SEBI Bans Anil Ambani and Three Associates
SEBI (The Securities and Exchange Board of India) bans Anil Ambani with 3 associates and Reliance Home Finance his former company from the market. The ban is applicable for 3 months continuously over misusing the funds. Three associates were Amit Bapna, Ravindra Sudhakar & R Shah. These three including Anil Ambani are restrained from connecting with any listed entities. They were accused of diverting the funds to other group entities to settle off deficits.
Corporate finance accounting services provider Price Waterhouse Coopers (PwC) were the auditors. They refused to sign the annual accounts and then resigned. Which correlates with the misuse of funds by Reliance Home Finance.
Until the release of further orders, SEBI has restrained Anil and his three associates. They should not take part in any deal related to buying or selling securities, either directly or indirectly.
Until further orders, SEBI has also restrained, Anil and his three associates to involve themselves with any mediator, listed public company or promoter who intends to raise money from the public.
S.K Mohanty who is a whole-time member of SEBI detects that proceedings of funds can be from multiple sources. This result of this practice was the resignation of PwC to Reliance Home Finance. PwC was the statuary auditor for Reliance Home Finance. SEBI also get precautious as multiple complaints were coming from people telling about the diversion of funds of the company by its promoters and management.
Due to these complaints and suspicions, SEBI has started an investigation of matters of Reliance Home Finance. SEBI also said most allegations were true while investigating the matters for the fiscal year 2018-19.
With the progress of the investigation, SEBI found that Reliance Home Finance has moved its funds to atleast 13 different entities. These entities include CITI Securities & Financial Services, Tulip Advisors and Arion Movie Productions. These movements of funds are masked as the General Purpose Corporate Loans (GCPL). This type of movement are said to be legal accounting practises.