Reliance Group Chairman Anil Ambani cannot hold a key managerial position in any listed company for five years, the capital markets regulator SEBI said in an order today.
SEBI also barred Mr Ambani and 24 other entities from the capital markets for five years for diverting funds from Reliance Home Finance Ltd (RHFL).
"Noticee No. 2 is restrained from being associated with the securities market including as a director or Key Managerial Personnel in any listed company, holding/associate company of any listed company, or in any intermediary registered with SEBI, for a period of 5 years, from the date of coming into force of this direction," the Securities and Exchange Board of India (SEBI) said in its order.
SEBI has fined Mr Ambani Rs 25 crore for running a fraud scheme to divert money from RHFL by disguising them as loans to entities linked to him.
"The Board of Directors of RHFL issued strong directives to stop such lending practices and reviewed corporate loans regularly but the company's management ignored these orders. This suggests a significant failure of governance, driven by certain key managerial personnel under the influence of Anil Ambani," SEBI said in the order uploaded on its website.
The 24 others barred from accessing the capital markets include Amit Bapna, Ravindra Sudhalkar, and Pinkesh R Shah — former top officials of RHFL. SEBI imposed a fine of Rs 27 crore on Mr Bapna, Rs 26 crore on Mr Sudhalkar, and Rs 21 crore on Mr Shah.
SEBI noted the "cavalier approach of the company's management and promoter in approving loans worth hundreds of crores to companies that had little to no assets, cash flow, net worth, or revenue".
