- General
- November 20, 2024
- 3 minutes read
U.S. Prosecutors Indict Indian Tycoon Adani For Bribery
The United States Justice Department has filed criminal charges against Indian tycoon Gautam Adani and seven associates, including his nephew,…
The United States Justice Department has filed criminal charges against Indian tycoon Gautam Adani and seven associates, including his nephew, Sagar Adani. U.S. prosecutors accuse Adani and his associates of paying $250mn in bribes to Indian government officials to obtain energy supply contracts.
U.S. prosecutors allege that Adani concealed the bribe payments from U.S. bondholders, which constitutes fraud. He was indicted for conspiracy to commit securities and wire fraud. Five associates were charged with conspiracy to violate the U.S. Foreign Corrupt Practices Act in connection with the alleged bribery scheme.
- Gautam Adani runs the Adani Group, one of India’s biggest conglomerates with over $30bn in annual revenue. The group generates most of its revenue from energy, primarily coal, but has heavily expanded into renewable energy over the past decade.
- Prosecutors accuse Adani of paying over $250mn in bribes to secure state contracts for Adani Group’s fast-growing renewable energy business. Adani Group companies trade on Indian stock exchanges, but the company has sold dollar-denominated bonds to U.S.-based investors, giving the U.S. government jurisdiction.
- Adani Green, an Adani Group subsidiary, has sold billions of dollars worth of bonds to finance renewable energy projects in India, with the government as the primary customer.
In 2023, prominent short-seller Hindenburg Research accused Adani Group of stock manipulation and accounting fraud, causing its publicly-traded subsidiaries’ stocks to fall by 50%. However, they’ve since rebounded to the pre-Hindenburg levels.
The criminal indictment against Gautam Adani will likely cause another sharp stock drop for his eponymous group’s subsidiaries. In addition to the criminal charges, the U.S. Securities and Exchange Commission (SEC) also filed civil securities fraud charges against Adani and two associates, alleging they perpetrated bribery schemes to obtain state contracts.
Gautam Adani is one of India’s richest and most prominent tycoons, with a net worth topping $80bn (as of writing) according to the Bloomberg Billionaires Index. The criminal charges against him were unsealed in a New York federal court on Wednesday.
