Indian billionaire Gautam Adani has been indicted for fraud by U.S. prosecutors and arrest warrants issued for him and his nephew for their alleged roles in a $265 million scheme to bribe Indian officials to secure power-supply deals.
The US court said a five-count criminal indictment was unsealed in federal court in Brooklyn charging Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain, executives of an Indian renewable-energy company (the Indian Energy Company), with conspiracies to commit securities and wire fraud and substantive securities fraud for their roles in a multi-billion-dollar scheme to obtain funds from U.S. investors and global financial institutions on the basis of false and misleading statements.
The indictment also charges Ranjit Gupta and Rupesh Agarwal, former executives of a renewable-energy company with securities that had traded on the New York Stock Exchange (the U.S. Issuer), and Cyril Cabanes, Saurabh Agarwal and Deepak Malhotra, former employees of a Canadian institutional investor, with conspiracy to violate the Foreign Corrupt Practices Act in connection with a bribery scheme also perpetrated by Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain, involving one of the world’s largest solar energy projects.
Billions of dollars were wiped off the market value of Adani Group companies and Kenya’s president canceled a massive airport project with the group immediately after the announcement.
U.S. authorities said that eight people, including Adani and his nephew Sagar, agreed to pay about $265 million in bribes to Indian government officials to obtain contracts expected to yield $2 billion of profit over 20 years, and to develop India’s largest solar power plant project.
“U.S. law bars foreign companies which raise money from U.S. investors from paying bribes overseas to win business. It is also against U.S. law to raise money from investors on the basis of false statements,” Reuters reported.
“As alleged, the defendants orchestrated an elaborate scheme to bribe Indian government officials to secure contracts worth billions of dollars and Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain lied about the bribery scheme as they sought to raise capital from U.S. and international investors,” stated United States Attorney Peace.
Adani Group said in a statement that the allegations made by the U.S. Department of Justice and U.S. Securities and Exchange Commission (SEC) in a parallel civil case were “baseless and denied,” adding it would seek “all possible legal recourse.”
Separately, the Securities and Exchange Commission, the US’s top markets watchdog, charged Adani, 62, and two other executives over conduct it said had arisen out of a “massive bribery scheme” that involved $175m from US investors.
Gautam Adani is worth $69.8bn, according to Forbes magazine, making him the world’s 22nd richest and India’s second-richest person.
It’s important to note that an indictment is just the beginning of a legal battle, not a declaration of guilt.
