In a stock exchange filing, Adani Green Energy Ltd – which is at the center of bribery allegations – says reports that the trio have been charged with FCPA violations are “false”.
An indictment filed by authorities in a New York court in an alleged bribery case against billionaire Gautam Adani and his nephew Sagar has not been charged with any violation of the US Foreign Corrupt Practices Act (FCPA), the Adani group said on Wednesday.
He has been charged under securities fraud which includes collection of monetary penalty.
Gautam Adani, the founding chairman of the port-to-energy conglomerate, his nephew Sagar and other key executives have been charged by the US Department of Justice with being part of an alleged scheme to bribe Indian officials to the tune of USD 265 million to win contracts. for the supply of solar electricity that will generate USD 2 billion in profits over a 20-year period.
In a stock exchange filing, Adani Green Energy Ltd – which is at the center of bribery allegations – said reports that the trio had been charged with FCPA violations were “false”.
They are charged with offenses that are punishable with monetary fines or fines.
“Gautam Adani, Sagar Adani and Vineet Jain are not charged with any violation of the FCPA in the counts set forth in the US DOJ or US SEC civil complaint.
“These directors are charged in the criminal indictment with three counts namely (i) alleged securities fraud conspiracy, (ii) alleged wire fraud conspiracy and (iii) alleged securities fraud,” it said.
The Adani Group has denied all the allegations as baseless and said it will take all possible legal recourse to defend itself.
The United States Department of Justice (US DOJ) and the United States Securities and Exchange Commission (US SEC) have issued criminal charges and brought a civil complaint in the US District Court for the Eastern District of New York against Gautam Adani, Sagar. Adani and Vineet Jain – all directors of Adani Green Energy Limited.
“The inquiry does not mention any penalty/penalty amount,” the company said.
The civil complaint alleges that the officers violated certain sections of the Securities Act of 1933 and the Securities Act of 1934 and assisted Adani Green Energy in violating the Securities Act of 1933 and the Securities Act of 1934.
“Although the complaint prays for an order to pay the civil monetary penalty to the defendants, it does not enumerate the amount of the penalty,” it added.
The DoJ alleged that between 2020 and 2024, senior officials of Adani Green, Azure Power, and CDPQ (Caisse de dépôt et placement du Québec — a Canadian institutional investor and Azure’s largest shareholder) participated in a scheme to bribe Indian government officials. . Execution of lucrative Solar Power Supply Agreements with Government of India Institutions.
During the same period, senior Adani Green officials conspired to misrepresent the company’s anti-bribery practices (to US-based investors and international financial institutions) and concealed bribes from Indian government officials to obtain billions of dollars in loans from those investors and institutions. For green energy projects, including corrupt solar power supply contracts, the DoJ said.
Of the five counts in the US DOJ’s indictment, Adani and two other executives are not charged in count 1 (appearing on page 42 of the US DOJ’s indictment), which the DoJ describes as “conspiracy to violate the FCPA.”
Count 1 includes Ranjit Gupta, Cyril Cabanes, Saurabh Aggarwal, Deepak Malhotra and Rupesh Aggarwal.
Adani and its executives are also not charged in Count 5 (appearing on page 51 of the US DOJ’s indictment), which the DOJ describes as “conspiracy to obstruct justice.”
Those charged in Count 5 are Cyril Cabnes, Saurabh Aggarwal, Deepak Malhotra and Rupesh Aggarwal.
Since Gautam Adani, Sagar Adani and Vaneet Jain have not been charged with Counts 1 or 5 (conspiracy to violate the FCPA and conspiracy to obstruct justice, respectively), US authorities could be charged with Counts 2, 3 or 4 (conspiracy to commit securities fraud). not , wire fraud conspiracy and securities fraud, respectively).
Stocks fall: Adani group companies have lost nearly USD 54 billion in market capitalization following the US indictment.
Credit Rating Downgrades International credit rating agencies including Moody’s and Fitch have downgraded their outlook on Adani Firms.
Despite receiving an order book of USD 2 billion for USD 600 million green bonds, Adani Green Energy Ltd withdrew those bonds to protect investors from potential mark-to-market losses. The DOJ indictment appeared on the exact day AGEL launched its bonds.
International Partnerships and Investments Total Energy: The French oil major has halted new investments in Adani companies, citing bribery allegations as a significant concern. Total Energy has investments in Adani Green Energy and Adani Total Gas and this announced break suggests a cautious approach amid legal uncertainties.
US International Development Finance Corporation: DFC has announced that it is reviewing its USD 550-million port development loan to the Adani-led consortium developing CWIT, a container terminal at Colombo Port. The agency says it is evaluating the implications of the allegations on project integrity and compliance.
GQG Partners: The investment firm has faced a sudden financial shock due to its significant holdings in Adani companies. Shares of GQG Partners fell sharply, and while the firm has publicly expressed its confidence in the resilience of the Adani group, it may be forced to review its investments in Adani in light of the legal developments.
Jefferies: The US investment bank, which has been a significant supporter of the Adani Group, is rethinking its relationship with the group following allegations of bribery. This reassessment reflects concerns over reputational risks and compliance issues.