The RCC Infraventures Scam: A Multi-Lender Fraud Unravelling Across States

When Borrowers Turn Litigants: How Fraudsters Are Twisting the Law to Dodge loan Repayment

Financial institutions across India are increasingly grappling with borrowers who manipulate consumer protection laws, procedural loopholes, and judicial leniency to indefinitely delay—or completely avoid—repayment. Common tactics include filing baseless complaints, deliberately misrepresenting facts, and launching retaliatory legal actions against lenders. A disturbing trend is emerging, where defaulters are leveraging the judicial system—not to uphold justice, but as a tool to shield themselves from legitimate recovery efforts.

Legal Safeguards Being Exploited

A glaring instance of this misuse surfaced in a case before the Allahabad High Court, where a borrower, after defaulting on a loan, went as far as filing a false First Information Report (FIR) against the lender. The charge? Alleged cheating and criminal breach of trust—simply because the lender exercised its legal right to initiate recovery.

In Rajpal Singh vs. State of U.P. & Others, the borrower accused bank officials of deception and breach of trust post-initiation of recovery efforts. However, the High Court saw through the ploy, dismissed the FIR as an abuse of legal process, and even imposed a penalty on the borrower. This case clearly illustrates a growing tactic among defaulters: using legal intimidation to stall legitimate recoveries.

The scale of this issue was further emphasized during judicial proceedings, where an editor in attendance noted that even the Hon’ble Supreme Court had, in similar cases, recommended referring matters to the Serious Fraud Investigation Office (SFIO) due to the magnitude of the alleged fraud. It reflects the gravity and systemic nature of such scams.

RCC Infraventures: A Multi-Crore Scam

Among the most telling cases is that of RCC Infraventures Ltd. and the Jain family, accused of orchestrating a fraud exceeding ₹100 crore across multiple financial institutions. As per FIR No. 0295/2024, filed at DLF Sector-29 Police Station in Gurugram, RCC secured multiple loans between 2018 and 2019 for an infrastructure project on NH-74—and then defaulted on all of them as part of a premeditated conspiracy.

Despite receiving over ₹100 crore in disbursals, RCC failed to honour its repayment commitments and now faces accusations of forgery, document falsification, and criminal conspiracy. Repeated attempts to stall investigations were firmly rejected by both the Punjab & Haryana High Court and the Supreme Court, signalling strong judicial disapproval of these obstructive tactics.

A Pattern of Recurring Fraud

What makes the RCC case even more concerning is the repeated use of similar tactics across multiple lenders. RCC and its directors have defrauded institutions including Yes Bank (2020), HDFC Bank (2021), Union Bank of India (2022), and Kotak Mahindra Bank (2023)—as well as another non-banking lender operating across Delhi NCR, Uttar Pradesh, Maharashtra, and Uttarakhand.

In one such case involving a Delhi-based lender, RCC defaulted on the loan post-disbursal and responded with threats, non-cooperation, and false legal complaints—clearly intended to derail recovery efforts. This reflects a deliberate and repeated strategy to evade financial and legal accountability.

Individuals such as Luv Jain and Ravi Kumar Jain have been implicated in multiple cheque bounce cases, civil suits, and loan defaults across various jurisdictions, including Delhi, Gurugram, Uttar Pradesh, Punjab, and Mumbai. In several instances, their properties have been attached and auctioned for loan recovery, and Ravi Jain has even been arrested in connection with one of the FIRs.

Further investigation has revealed significant lapses in GST and Income Tax filings, running into crores—highlighting that this is not just a fraud against private lenders, but a financial crime against the state as well.

The Case for Swift Regulatory Intervention

From the courtrooms of Allahabad to the streets of Delhi and Gurugram, a troubling pattern is emerging: borrowers are misusing the legal system to dodge legitimate financial obligations, dragging lenders into prolonged legal battles. This growing trend not only undermines the integrity of the financial system but also risks making lenders more cautious, ultimately impacting genuine borrowers.

Regulators must act decisively and without delay. Strengthening borrower-screening systems, introducing legal safeguards against malicious FIRs, ensuring swift action by agencies like the Economic Offences Wing, Crime Branch, and SFIO, and enforcing strict penalties for legal misuse are all critical steps. It’s time to draw a clear line between legal protection and manipulation—ensuring that justice supports the honest, not the fraudulent.