Deciphering US charges against Gautam Adani and others: 10 points | India News – Times of India

NEW DELHI: Gautam Adani and his conglomerate, the Adani Group, are at the center of a major legal and financial storm following an indictment by US prosecutors. The indictment alleges that Adani, his cousin Sagar Adani and other associates orchestrated a $265 million murder. bribery scheme lucrative security solar energy contracts in India. Between 2020 and 2024, the suspects allegedly bribed Indian officials to gain business benefits while misleading US investors and financial institutions about their anti-corruption practices.
The charges against Adani and others were filed in the US District Court for the Eastern District of New York, a prominent federal court known for handling high-profile cases involving corporate fraud, securities violations and international corruption. Located in Brooklyn, this court has jurisdiction over cases involving violations of U.S. federal law, especially those relating to international financial systems and foreign bribery under the Foreign Corrupt Practices Act (FCPA).
The prosecution is led by U.S. Attorney for the Eastern District of New York Breon Peace, who oversees cases involving white-collar crime, organized fraud and transnational crimes.
Why US authorities took action
The American indictment stems from the involvement of US investors and financial markets in the alleged fraud. Under the Foreign Corrupt Practices Act (FCPA), U.S. law prohibits companies from bribing foreign officials if their activities involve U.S. financial systems or investors.
In this case: Funds were raised from U.S. investors and allegations indicated fraudulent disclosures related to securities offerings.
Here’s everything you need to know about:
1. What are the main allegations against Gautam Adani and the Adani Group?
US prosecutors have charged Gautam Adani, his cousin Sagar Adani and others in a $265 million bribery scheme to win solar energy contracts in India. The indictment alleges that Adani Group executives paid bribes to Indian government officials between 2020 and 2024 and concealed these activities from U.S. investors. The charges include securities fraud, bank fraud conspiracy and misleading investors about anti-corruption practices.
2. How did the alleged bribery scheme work?
The indictment states that executives used encrypted communications, mobile tracking and coded language to discuss and carry out the bribery scheme. Bribes were calculated at approximately $30,000 per megawatt for solar projects and disguised as “development fees.” In some cases, Azure Power, a related company, transferred projects to Adani Green Energy as part of the bribery scheme.
3. What are the financial consequences of the charges against Adani Group companies?
The allegations have led to a massive sell-off in Adani Group’s shares, with the conglomerate losing about $27 billion in market value. Shares of Adani Enterprises fell 23%, and Adani Green Energy fell 19%. The group also canceled a $600 million bond issue due to negative market reaction.
4. What are the political implications of these allegations in India?
The indictment has increased political tensions. Opposition leaders, including Rahul Gandhi, have called for Adani’s arrest and an inquiry into his alleged links with Prime Minister Narendra Modi. Critics claim the case underlines a broader issue of corruption and cronyism within the Indian government, although the BJP denies these claims and insists legal processes must take their course.
5. What is the Adani Group’s response to the allegations?
The Adani Group has denied the allegations, calling them “baseless” and politically motivated. A group statement emphasized its commitment to governance, transparency and regulatory compliance, and asserted that it would take all possible legal action to dispute the allegations.
6. How were US federal authorities involved in the investigation?
The US investigation included the FBI seizing electronic evidence from Sagar Adani in 2023 and uncovering extensive documentation of the bribery scheme, including PowerPoint presentations and encrypted communications. US authorities have also issued arrest warrants for Gautam and Sagar Adani.
7. What are the international implications of this case?
This case has highlighted the cross-border enforcement of anti-corruption laws, especially the US Foreign Corrupt Practices Act (FCPA). It also affects international investors’ confidence in Indian conglomerates, as Adani’s global reputation and access to capital markets are now under intense scrutiny.
8. How does this compare to previous allegations against Adani Group?
The Adani Group faced similar scrutiny in 2023 when Hindenburg Research accused the company of stock price manipulation and improper use of tax havens. Although the group denied these allegations, the current indictment adds legal weight to concerns about its business practices.
9. What role does Azure Power play in this case?
Azure Power, formerly listed on the New York Stock Exchange, is implicated as a co-conspirator. Azure executives allegedly worked with Adani executives to plan and facilitate bribes. Azure has since stated that individuals named in the complaint are no longer affiliated with the company.
10. What’s next for Gautam Adani and the Adani Group?
Legal experts suggest Adani could seek dismissal of the charges or negotiate a settlement with US authorities. Meanwhile, Indian authorities may come under pressure to start their investigation. Market analysts predict continued volatility in Adani Group shares as the case unfolds.
(With input from others)