CBI files FIR against Kishore Biyani Future Retail in alleged Rs 904-cr bank fraud

     New Delhi, Nov 6 (PTI) The CBI has registered an FIR against Future Retail Ltd and noted businessman Kishore Biyani in an alleged bank fraud of Rs 904.32 crore and conducted searches at premises linked to him in Mumbai on Friday, officials said.

     The CBI has also booked his brother Rakesh Biyani in the case registered under offenses of criminal conspiracy for cheating and also for offenses under the Prevention of Corruption Act, they said.

     "The Central Bureau of Investigation (CBI) has registered a case on the complaint of the State Bank of India, Stressed Assets Management Branch - III, Mumbai against M/s Future Retail Ltd. (M/s. FRL) and its Promoters/Managing Directors/ Executive Directors/Guarantors namely, (i) Kishore Biyani (ii) Rakesh Biyani, unknown public servants and unknown others for offenses of criminal conspiracy for cheating and also the offenses under the Prevention of Corruption Act, resulting in alleged wrongful loss of Rs.904.32 crores to the complainant Bank," a CBI Spokesperson said in a statement.

     Multiple calls made to the company seeking a reaction remained unanswered.

     The CBI has alleged that according to a complaint filed by SBI, the accused persons entered into a criminal conspiracy to obtain credit facilities from the State Bank of India and also from the consortium of nine banks.

     Future Retail operated multiple retail formats, including hypermarkets and supermarkets such as Big Bazaar, Fashion@Big Bazaar and Foodhall. It was also engaged in the general trading of FMCG and fashion goods through its stores, the statement said.

     The CBI alleged that the company did not use the bank funds for the purposes for which they had been sanctioned.

     "It is further alleged that the company diverted the funds by siphoning them off through associate companies/connected entities and caused loss to the bank," the statement said.

     The agency registered the FIR on November 4 and conducted searches at multiple premises in Mumbai.

     "Incriminating documents relevant to the investigation were recovered and seized during the searches," the CBI spokesperson said.

     The probe is underway to ascertain the full extent of the alleged conspiracy, identify the roles of all those involved, including public servants and private individuals, and trace the end-use of the loan funds, she said.

     Estimated wrongful loss to SBI as on the date of fraud declaration -- March 23, 2026 -- was Rs. 904.32 crore plus notional interest amounting to Rs. 1,331.91 crore which brings the total to Rs 2,236.23 crore.

     The bank was part of a consortium of banks and financial institutions.

     The SBI complaint alleged that the company had substantial exposure outside the consortium also and the claim admitted by the Resolution Professional (RP) under CIRP is over Rs 19,000 crore.

     The forensic audit of Future Retail Limited (FRL), conducted for the period from April 01, 2017 to April 30, 2022, revealed a "systematic pattern of financial irregularities, including questionable transactions with connected parties and related entities, numerous instances of manipulation of books of accounts, suspected diversion and layering of funds, erosion of investment value, and other transactions lacking commercial justification," it said.

     The complaint, now the part of the FIR, alleged the company had resorted to irregular accounting practices which rendered timely detection difficult.

     "On review of bank statements, the Forensic Auditor has noted 13 entities to whom there was net payment of Rs. 5,878.28 crore made during the review period. All these entities were related/connected with FRL," the FIR alleged.

     It said on review of financials of FRL as well as entities with whom receipt and payment transactions have taken place, it has been noted that there is a mismatch in amount of receipt and payment transactions as per bank statements of FRL vis a vis amounts reflected in the related party disclosure of FRL as well as related party disclosure of such entities raising questions on genuineness of the transactions.

     "The forensic audit reveals a consistent pattern of routing substantial funds to related parties and connected entities whose financial capacity and business operations were not commensurate with the transactions undertaken," the complaint alleged.

     The audit further highlights apparent manipulation of accounting records, falsification of books of accounts, layering of financial transactions through connected entities, abnormal increases in advances and security deposits without commercial justification, investments in financially distressed entities, and questionable franchise arrangements lacking transparency and supporting documentation, it alleged.

     "The promoters and directors of Future Retail Ltd, in conspiracy with connected entities and other unknown persons, appear to have dishonestly misappropriated bank funds, falsified books of accounts, concealed the true financial position of the company and thereby cheated the consortium member banks," the complaint alleged.

     The complaint further alleged that the findings indicate commission of cognizable offences involving criminal conspiracy, cheating, criminal breach of trust, falsification of accounts and diversion and siphoning of bank funds involving Future Retail Limited and the recipient entities.

     "The entire chain of transactions, the commercial rationale, the nature, purpose & end-use of funds and the role of the connected parties merit a thorough investigation by the CBI into the role of the promoters, directors, key managerial personnel, related entities and all other persons involved in the fraudulent transactions," it alleged.

(This story has not been edited by THE WEEK and is auto-generated from PTI)