The State Bank of India has formally removed the ‘fraud’ tag from Religare Finvest Limited (RFL) following the Delhi High Court’s December 2023 order asking the lender to do so. SBI had tagged RFL’s record as ‘fraud’ in the Reserve Bank of India’s Central Fraud Registry database.
RFL is a wholly-owned subsidiary of Religare Enterprises Limited. SBI informed RFL about the same on Friday through a formal communication.
The RBI imposed a Corrective Action Plan (CAP) on RFL in January 2018. RFL has been a loss-making enterprise since 2017 and had accumulated losses to the tune of Rs 2,270 crore till March 2022. It said total expenses over the past financial year had been in excess of Rs 639 crore, against the total income of Rs 275.25 crore. On account of large scale siphoning of funds from REL and RFL, the latter was put into the CAP framework by the RBI.
RFL completed a one-time settlement with 16 lenders through organic collections in March 2023 and paid more than Rs 9,000 crore to the banking system, it said in a press release.
“We are pleased to witness the positive outcome of our efforts. The removal of the ‘fraud’ tag stands as a testament to the commitment and dedication of the Company’s Board, management and employees in resurrecting RFL and the Group from the brink in the aftermath of fraud perpetrated by the erstwhile promoters and their affiliates and putting it on the path of growth and development,” said Rashmi Saluja, Executive Chairperson, REL & CMD RFL.
Central investigative agency Enforcement Directorate (ED) recently conducted searches on the premises of entities linked to Essel Group in connection with its probe into alleged money laundering involving RFL. ED’s money laundering case against erstwhile Religare promoters Malvinder and Shivinder Mohan Singh and its former chairman and managing director, Sunil Godhwani, is based on a case registered by the Delhi Police’s Economic Offences Wing.
