US prosecutors have charged billionaire Gautam Adani and his nephew, Sagar Adaniamong others, for his alleged role in the $265 million (Rs 2,000 crore) bribery case to secure a solar power supply contract in India, plunging the oil-to-ports giant into major controversy for the second time in 22 months, following allegations by short seller Hindenburg Research.
Arrest warrants have been issued in the US for Gautam and Sagar Adani and US prosecutors plan to hand over the warrants to foreign law enforcement, according to court records, Reuters reported.
Earlier on Wednesday, the US Department of Justice (DoJ) indicted two Adanis, former CEO of Adani Green Vneet Jaain and former executive of Azure Power and Canadian pension fund CDPQ for allegedly taking bribes to secure power purchase contracts from five states – Andhra Pradesh, Odisha, Chhattisgarh, Tamil Nadu and J&K – between 2020 and 2024. They are also charged under strict laws. Foreign Corrupt Practices Act (FCPA) because Adani had raised money through bonds from US investors and Azure Power before listing on the NYSE.
Separately, in US Securities Exchange Commission (SEC) charged Gautam and Sagar Adani and Cyril Cabanes, former directors on the board of Azure, with FCPA violations. They also accused him of raising money from US investors on “false and misleading statements” that he was not involved in bribery.
“The opposite is true. The defendants (Gautam and Sagar Adani) have been involved in paying or promising bribes worth hundreds of millions of dollars to secure undue influence over Indian government officials and obtain contracts between the Indian state government and the beneficiary SECI. Adani Green, ” the SEC said in a complaint to the court, demanding a jury trial. The DoJ charges are criminal; The SEC is civil.
The charge sheet filed in the US District Court, Eastern District of New York, said that a major part of the bribe – Rs 1,750 crore – was allegedly paid for contracts in Andhra. In a separate complaint, the SEC said the money was paid after Gautam Adani met the chief minister in August 2021. (Jagan Mohan Reddy was the CM at that time).
In or in connection with the meeting, Gautam Adani paid or promised bribes to AP government officials to get relevant AP entities to sign power supply agreements with SECI to purchase 7,000 MW of power capacity,” the SEC said, adding that within weeks, the state cabinet cleared the proposal. .
“In other words, bribes paid or promised are acceptable,” the regulator said.
While explaining that the charges in the indictment are allegations, and the defendants are presumed innocent until proven guilty, the US Attorney’s Office for the eastern district of New York issued the indictment on five counts of 1) alleged conspiracy to violate the FCPA by giving or paying bribes; 2) alleged securities fraud conspiracy to make false or misleading statements when raising money; wire fraud conspiracy when raising syndicated loans of $1.4 billion in 2021; 4) alleged securities fraud during the 2021 bond issue and 5) conspiracy to obstruct justice by destroying and concealing records.
The bribery case is related to contracts starting in 2020 in which Adani Green Energy (8 gigawatts) and Azure Power (4 giga watts) won PLI-related projects to supply solar power to the GoI. Solar Energy Corporation of India (SECI), which was considered one of the biggest projects of the time.
But as SECI was unable to find a worthwhile buyer, the two companies allegedly hatched a plan to strike a deal for the state-owned power distribution company in exchange for bribes. According to court documents, Gautam and Sagar Adani along with Jaain were part of the bribery scheme.
The document also states that Adani is seeking to recover alleged payments of over Rs 600 crore made to Azure Power, for which Azure management is seeking to set up various schemes. Next, they decided to give up 2.3 GW of capacity with the understanding that Adanis would get it – something that happened.
