US prosecutors indict Adani & 7 others for allegedly promising $250 million in bribes to secure solar energy contract

November 21, 2024
Ahmedabad Gujarat

New York: US prosecutors in New York have indicted Adani Group Chairman Gautam S. Adani, his nephew Sagar Adani, and six other individuals for allegedly offering over $250 million in bribes to Indian government officials. The bribes were reportedly intended to secure lucrative solar energy contracts with state electricity distribution companies in India.

Rejecting the allegations, an Adani Group spokesperson stated, “The allegations made by the US Department of Justice and the US Securities and Exchange Commission against directors of Adani Green are baseless and denied. As stated by the US Department of Justice itself, ‘the charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.’ All possible legal recourse will be sought.”

According to a press release from the US Attorney’s Office, Eastern District of New York, “A five-count criminal indictment was unsealed today 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”

Breon Peace, United States Attorney for the Eastern District of New York, Lisa H. Miller, Deputy Assistant Attorney General for the Justice Department’s Criminal Division and James E. Dennehy, Assistant Director in Charge, Federal Bureau of Investigation, New York Field Office (FBI) announced the charges.

“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.  “My Office is committed to rooting out corruption in the international marketplace and protecting investors from those who seek to enrich themselves at the expense of the integrity of our financial markets.”

“This indictment alleges schemes to pay over $250 million in bribes to Indian government officials, to lie to investors and banks to raise billions of dollars, and to obstruct justice,” stated Deputy Assistant Attorney General Miller.  “These offenses were allegedly committed by senior executives and directors to obtain and finance massive state energy supply contracts through corruption and fraud at the expense of U.S. investors.  The Criminal Division will continue to aggressively prosecute corrupt, deceptive, and obstructive conduct that violates U.S. law, no matter where in the world it occurs.”

“Gautam S. Adani and seven other business executives allegedly bribed the Indian government to finance lucrative contracts designed to benefit their businesses. Adani and other defendants also defrauded investors by raising capital on the basis of false statements about bribery and corruption, while still other defendants allegedly attempted to conceal the bribery conspiracy by obstructing the government’s investigation,” stated FBI Assistant Director in Charge Dennehy.  “The FBI maintains its steadfast mission to expose all corrupt agreements, especially with international governments, and protect investors from related harm.”

The release further states that as alleged in the indictment, between approximately 2020 and 2024, the defendants agreed to pay more than $250 million in bribes to Indian government officials to obtain lucrative solar energy supply contracts with the Indian government, which were projected to generate more than $2 billion in profits after tax over an approximately 20-year period (the Bribery Scheme).  On several occasions, Gautam S. Adani personally met with an Indian government official to advance the Bribery Scheme, and the defendants held in-person meetings with each other to discuss aspects of its execution.  The defendants frequently discussed their efforts in furtherance of the Bribery Scheme, including through an electronic messaging application.  The defendants also extensively documented their corrupt efforts:  for example, Sagar R. Adani used his cellular phone to track specific details of the bribes offered and promised to government officials; Vneet S. Jaain used his cellular phone to photograph a document summarizing various bribe amounts the U.S. Issuer owed the Indian Energy Company for its respective portion of the bribes; and Rupesh Agarwal prepared and distributed to other defendants multiple analyses using PowerPoint and Excel that summarized various options for paying and concealing bribe payments (Bribery Analyses).

During this same period, Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain allegedly conspired to misrepresent the Indian Energy Company’s anti-bribery and corruption practices and conceal the Bribery Scheme from U.S. investors and international financial institutions in order to obtain financing, including to fund those solar energy supply contracts procured through bribery.  As alleged, Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain caused the Indian Energy Company and certain of its subsidiaries to raise capital on the basis of false and misleading statements in connection with (i) two U.S. dollar-denominated syndicate loans totaling more than $2 billion from lender groups comprised of international financial institutions and U.S.-based investors; and (ii) two Rule 144A bond offerings for more than $1 billion underwritten by international financial institutions, which were marketed and sold to investors in the U.S., among other places.  In addition, Gautam S. Adani, Sagar R. Adani and Vneet S. Jaain caused the Indian Energy Company to make false statements in their consolidated financial statements and to the market and investors regarding the Bribery Scheme, the U.S. Attorney’s Office, Eastern District of New York statement added.

The indictment further alleges that Cyril Cabanes, Saurabh Agarwal, Deepak Malhotra and Rupesh Agarwal conspired to obstruct the grand jury, FBI and U.S. Securities and Exchange Commission (SEC) investigations into the Bribery Scheme.  Among other things, those four defendants agreed to delete electronic materials related to the Bribery Scheme, including emails, electronic messages and Bribery Analyses; caused the U.S. Issuer’s Board of Directors to initiate an internal investigation into the Bribery Scheme and then withheld material information from that investigation; and falsely denied their participation in the Bribery Scheme to representatives of the FBI, DOJ and SEC at meetings in Brooklyn, New York.  For this conduct, Cyril Cabanes, Saurabh Agarwal, Deepak Malhotra and Rupesh Agarwal are charged with conspiracy to obstruct justice.

The charges in the indictment are allegations and the defendants are presumed innocent unless and until proven guilty.

In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC).  As the leader of the subcommittee, Mr. Peace plays a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes including bribery and fraud.

The press relases also states that the investigation was conducted by the FBI New York’s Corporate, Securities and Commodities Fraud and International Corruption Units.  The government’s case is being handled by the Business and Securities Fraud Section of the U.S. Attorney’s Office for the Eastern District of New York and the Criminal Division’s Fraud Section.  Assistant U.S. Attorneys Sarah M. Evans, Matthew R. Galeotti and Jessica K. Weigel of the Eastern District of New York, Shy Jackson of the Criminal Division, Fraud Section’s FCPA Unit and Andrew Tyler of the Fraud Section’s Market Integrity and Major Frauds Unit are prosecuting the case with assistance from Paralegal Specialists Liam McNett, Angelina Tyler and Nadiya Singh.

The Fraud Section is responsible for investigating and prosecuting FCPA and Foreign Extortion Prevention Act (FEPA) matters.  Additional information about the Justice Department’s FCPA and FEPA enforcement efforts can be found at www.justice.gov/criminal-fraud/foreign-corrupt-practices-act.

The Department of Justice’s Office of International Affairs and the SEC’s New York Regional and Boston Regional offices provided valuable assistance during the investigation, said the U.S. Attorney’s Office, Eastern District of New York.

The Defendants:

GAUTAM S. ADANI
Age: 62
India

SAGAR S. ADANI
Age: 30
India

VNEET S. JAAIN
Age: 53
India

RANJIT GUPTA
Age: 54
India

CYRIL CABANES
Age: 50
France / Australia

SAURABH AGARWAL
Age: 48
India

DEEPAK MALHOTRA
Age: 45
India

RUPESH AGARWAL
Age: 50
India

In a media statement , spokesperson of Adani Group said, “The allegations made by the US Department of Justice and the US Securities and Exchange Commission against directors of Adani Green are baseless and denied. As stated by the US Department of Justice itself, “the charges in the indictment are allegations and the defendants are presumed innocent unless and until proven guilty.” All possible legal recourse will be sought.”

“The Adani Group has always upheld and is steadfastly committed to maintaining the highest standards of governance, transparency and regulatory compliance across all jurisdictions of its operations. We assure our stakeholders, partners and employees that we are a law-abiding organisation, fully compliant with all laws.”

On another hand Following the allegations by the US Department of Justice against Adani, national politics has become more heated. Opposition Leader and Congress MP Rahul Gandhi held a press conference, demanding the arrest of Adani. He stated that it is “clear” and “established” that the Adani Group Chairman has violated both American and Indian laws.

Addressing a press conference, Rahul Gandhi said, “It is now pretty clear and established in America that Adani has broken both American law and Indian law. He is being indicted in the United States and I am wondering why Adani is still running around a free man in this country. Chief Ministers have been arrested and Adani has apparently done one 2000 cr scam and multiple others probably but there is no investigation.”

“We have been demanding for many days that Adani ji should be arrested. He should be arrested today itself. Madhabi Buch (SEBI Chairperson) who is his protector, who did not do any investigation, should be removed and an investigation should be done,” he further added.

While ruling BJP MP Sambit Patra said in a press briefing, “Today, since morning, we have been seeing in the media an issue regarding a company. There is a case against that company in the US, with allegations and counter-allegations. We clearly believe that, as far as the company and the case against it are concerned, the company will issue a statement and defend itself. The law will take its own course.”

#Adani #Gautam Adani #Karan Adani

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