The Ministry of Corporate Affairs (MCA) has started probing an alleged fund diversion by Reliance Capital and Reliance Home Finance, reported The Economic Times, citing sources close to the development. that the ministry is looking into suspicious transactions between the two firms and other companies belonging to the group, the report added.

The ministry, according to the report, will question the management and the audit committees of both the firms. In addition, the current auditor of the companies Pathak HD & Associates and PwC, executives who worked on the audit assignment, will also be questioned by the ministry, noted the report.

The investigation will be led by the ministry’s investigation arm Serious Fraud Investigation Office (SFIO), the report added.

Earlier, Price Waterhouse & Co Chartered Accountants LLP (PwC) resigned as one of the statutory auditors of Reliance Capital and Reliance Home Finance back in June. This, in turn, prompted Sebi and the Ministry of Corporate Affairs to look into the sudden resignation.

This was particularly significant in the wake of the auditors' role coming under the scanner of multiple agencies in cases involving various corporate houses, including listed companies.