Gautam Adani indicted in US over role in alleged bribery, fraud (2024)

New York: Gautam Adani, head of India's Adani Group, and seven others face charges in the United States in a multibillion-dollar bribery and fraud scheme, news agencies including Reuters and Bloomberg reported on November 21. Prosecutors announced the charges on Wednesday, alleging that the group bribed Indian officials to secure solar energy contracts.

Last week, Adani announced a multi-billion dollar investment in the US as he congratulated President-elect Donald Trump on his election victory. “Adani announced the investment while also congratulating U.S. President-elect Donald Trump on his election win," a Reuters report said.

It may be noted here that Trump has promised to simplify regulations for energy companies, making it easier for them to drill on federal land and construct pipelines.

Also Read: Gautam Adani Bribery Charges Explained

Gautam Adani indicted in US: What the case is all about

As per the case made out by the the US Securities and Exchange Commission, Gautam Adani has been charged with allegedly "defrauding American investors and bribing officials". Adani, his nephew Sagar Adani, 30, executives of Adani Green Energy, and Cyril Cabanes, an executive of Azure Power Global Ltd were charged with "conspiracy to commit securities and wire fraud, as well as substantive securities fraud, for their roles in a multi-billion-dollar scheme to obtain funds from US investors and global financial institutions through false and misleading statements".

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    The indictment says Adani and the others paid approximately $265 million in bribes. They expected these contracts to generate $2 billion in profit over two decades. Prosecutors claim some involved in the scheme used code names like “Numero uno” and “the big man” to refer to Gautam Adani.

    The indictment also alleges Adani, his nephew Sagar Adani, and another executive, Vneet Jaain, hid the bribery from lenders and investors to secure over $3 billion in loans and bonds for Adani Green Energy.

    The charges fall under the Foreign Corrupt Practices Act, a US law against bribery in foreign business dealings.

    "This indictment alleges schemes to pay over USD 250 million in bribes to Indian government officials, to lie to investors and banks to raise billions of dollars, and to obstruct justice," said Deputy Assistant Attorney General Lisa H Miller.

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    "These offences were allegedly committed by senior executives and directors to obtain and finance massive state energy supply contracts through corruption and fraud at the expense of US investors," she added.

    How Adani Group reacted

    Adani Group later issued an official statement responding to the charges. The statement said that "the allegations made by the US Department of Justice and the US Securities and Exchange Commission against directors of Adani Green are baseless and denied."

    "As stated by the US Department of Justice itself, the charges in the indictment are allegations and the defendants are presumed innocent unless and until proven guilty," Adani Group said.

    All possible legal recourse will be sought, a group spokesperson said.

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    According to the official release, "The Adani Group has always upheld and is steadfastly committed to maintaining the highest standards of governance, transparency and regulatory compliance across all jurisdictions of its operations. We assure our stakeholders, partners and employees that we are a law-abiding organisation, fully compliant with all laws."

    Bonds sold just hours before indictment

    Just hours ahead of the indictment news, a unit of Adani Group tapped the US corporate bond market for a $600 million offering. The offer was oversubscribed over 3x. The bond was later scrapped, following the indictment announcement.

    Adani had tried a similar offering a month earlier. That offer, however, had to be postponed after an investor pushback over pricing, according to a Bloomberg report.

    The bookrunners on the deal are DBS Bank Ltd., Emirates NBD Bank PJSC, First Abu Dhabi Bank PJSC, ING Group, Banca IMI SpA, Mizuho Securities Singapore Pte. Ltd., Mitsubishi UFJ Financial Group Inc., SMBC Nikko Securities Inc. and the State Bank of India, Bloomberg's report said.

    Read More: Gautam Adani Net Worth Plummets after Bribery Charges

    More case details

    According to a statement, Adani led the process to "pay or promise hundreds of millions of dollars in bribes to Indian government officials to induce them to enter contracts that Adani Green needed to develop India’s largest solar power plant project".

    The SEC also alleged that another company involved in the power plant project, Azure Power Global Ltd., agreed to pay some of these bribes.

    As per the SEC lawsuit, Cabanes is a director on the board at Azure Power Global and also serves as a representative of the company’s largest stockholder, pension fund company Caisse de Depot et Placement du Quebec (CDPQ). Cabanes, along with others, “schemed” to make payments to bribe government officials, the lawsuit said.

    Full list of names and details of defendants

    According to a US Attorney's Office (New York) office, the people involved in the briber and fraud case are:

    GAUTAM S. ADANI
    Age: 62
    India

    SAGAR S. ADANI
    Age: 30
    India

    VNEET S. JAAIN
    Age: 53
    India

    RANJIT GUPTA
    Age: 54
    India

    CYRIL CABANES
    Age: 50
    France / Australia

    SAURABH AGARWAL
    Age: 48
    India

    DEEPAK MALHOTRA
    Age: 45
    India

    RUPESH AGARWAL
    Age: 50
    India

    Arrest warrants have been issued for Gautam Adani and Sagar Adani and prosecutors plan to hand those warrants to foreign law enforcement, Reuters said citing court records. The US Securities and Exchange Commission filed related civil charges against the two men and another individual, Cyril Cabanes.

    Read More: Gautam Dani Should be Arrested: Rahul Gandhi

    Gautam Adani, 62, holds the position of 22nd richest person globally, according to Forbes magazine, with an estimated net worth of $69.8 billion.

    This is the second major setback for the Indian billionaire, coming after the Hindenburg Research case where the US-based short-seller accused Adani Group of improperly using offshore tax havens. Adani Group has denied these allegations. The report, released in January 2023, had triggered a significant drop in Adani Group stocks, wiping out approximately $150 billion.

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    Gautam Adani indicted in US over role in alleged bribery, fraud (2024)
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