CFO of Reliance Power Arrested in Fake Guarantee Case

NEW DELHI: The Enforcement Directorate (ED) has arrested Ashok Pal, the Chief Financial Officer (CFO) of Reliance Power, in connection with a money laundering case involving a fake bank guarantee worth Rs 68 crore. The arrest took place on Friday night under the Prevention of Money Laundering Act (PMLA) after Pal was questioned by the agency. He is set to appear before a special court where the ED will request his remand for further interrogation.

The case revolves around a bank guarantee of Rs 68.2 crore that was submitted to the Solar Energy Corporation of India Limited (SECI) on behalf of Reliance NU BESS Limited, a subsidiary of Reliance Power. This guarantee was later discovered to be fraudulent. The ED has identified Odisha-based Biswal Tradelink as the company allegedly involved in issuing these fake guarantees.

In August, the ED conducted searches related to Biswal Tradelink and arrested its Managing Director, Partha Sarathi Biswal. The investigation stems from a First Information Report (FIR) filed by the Delhi Police's Economic Offences Wing (EOW) in November 2024, which accused the company of issuing fake bank guarantees for an 8% commission.

Reliance Group has stated that Reliance Power was a victim of a "fraud, forgery and cheating conspiracy" and has made the necessary disclosures to the stock exchange. A spokesperson for the group mentioned that a criminal complaint was filed against the accused company with the EOW in October 2024, and they are committed to following the legal process.

The ED's preliminary findings suggest that Biswal Tradelink used a deceptive email domain to impersonate the State Bank of India (SBI) and sent forged communications to SECI. The investigation revealed that the company facilitated fake bills for commissions and operated multiple undisclosed bank accounts, conducting suspicious transactions worth crores of rupees. Furthermore, the company is described as a "mere paper entity," with its registered office located at a residential property belonging to a relative of Biswal, where no company records were found during the searches.