CBI arrests former RCom MD in bank fraud case
What's the story
Amitabh Jhunjhunwala, the former Group Managing Director of Reliance Communications, has been arrested by the Central Bureau of Investigation (CBI) in a major bank fraud case. The CBI alleges that Jhunjhunwala was instrumental in securing loans from various banks and that these funds were misused by other officials of the RCom Group. This misappropriation has allegedly caused wrongful losses to banks.
Allegations
Jhunjhunwala's role in the alleged fraud
As the Group Managing Director, Jhunjhunwala oversaw key functions such as corporate finance, banking, and fund utilization. The CBI claims he worked with senior bank officials for loans and advances. The agency also alleges that under his direction, loan funds received from banks were mismanaged or misused by other RCom Group officials.
Legal proceedings
Jhunjhunwala was previously lodged in Tihar jail
Jhunjhunwala was previously in judicial custody in a case being probed by the Enforcement Directorate (ED) and lodged in Tihar Jail. After production warrants were issued by a special court in Mumbai, he was transferred to AIIMS, New Delhi for medical examination. Following the examination by an AIIMS medical board, he was declared fit to travel and subsequently brought to Mumbai for court proceedings today.
Arrest
Remanded to judicial custody
After Jhunjhunwala's production in court, the CBI formally arrested him. He was then remanded to judicial custody in the RCom case and sent to Arthur Road Jail. The agency has said that Jhunjhunwala was instrumental in securing loans from various banks which later turned into non-performing assets as the company failed to repay them.
Case details
CBI filed FIR based on SBI's complaint
The CBI's FIR was registered on a complaint from the State Bank of India against Reliance Communications Limited and Anil D Ambani for allegedly causing a loss of ₹2,929.05 crore to the bank. A consortium of 11 banks led by SBI had sanctioned term loans to Reliance Communications Limited, which together allegedly suffered losses of ₹6,015 crore. The total exposure toward RCom stood at ₹19,694.33 crore involving 17 public sector banks.