While the news of billionaire chair of conglomerate Adani Group, Gautam Adani’s indictment by the US prosecutors is doing the rounds since the early hours of Thursday, India time, what really happened and what were the series of events that unfold? On Thursday, the US Attorney’s office in New York released a press release stating that a five-count criminal indictment was unsealed in federal court in Brooklyn charging Gautam Adani, Sagar Adani and Vneet Jaain, 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 US investors and global financial institutions on the basis of false and misleading statements.
Lisa H Miller, Deputy Assistant Attorney General for the Justice Department’s Criminal Division, in a release, said, “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. 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 US investors. The Criminal Division will continue to aggressively prosecute corrupt, deceptive, and obstructive conduct that violates US law, no matter where in the world it occurs.”
Charges by Securities and Exchange Commission
In a parallel move, the Securities and Exchange Commission charged Gautam Adani and Sagar Adani, and Cyril Cabanes, with conduct arising out of a massive bribery scheme.
SEC filed two complaints in the US District Court for the Eastern District of New York. In one action, the SEC charged Gautam Adan and his nephew, Sagar Adani, Executive Director of Adani Green’s Board. According to the SEC’s complaint, Gautam and Sagar Adani orchestrated a bribery scheme that involved paying or promising to pay the equivalent of hundreds of millions of dollars in bribes to Indian government officials to secure their commitment to purchase energy at above-market rates that would benefit Adani green and Azure Power.
In the other action, the SEC charged Cyril Cabanes, a former member of Azure Power’s Board of Directors, with Foreign Corrupt Practices Act (FCPA) violations for his role in the alleged bribery scheme. According to the SEC’s complaint, Cabanes allegedly facilitated the authorization of bribes in furtherance of the scheme while in the United States and abroad.
Executives charged by US prosecutors
Adani, his nephew Sagar Adani and six others are indicted for allegedly offering Rs 2,029 crore (US $265 million) in bribes to Indian government officials for securing “lucrative solar energy supply contracts” with state electricity distribution companies. Besides Gautam Adani, the other six defendants named are: i) Vneet Jaain, who is the CEO of Adani Green Energy Ltd, ii) Ranjit Gupta (who was CEO of Azure Power Global Ltd between 2019 and 2022), iii) Rupesh Agarwal, who also worked with Azure Power (between 2022 and 2023); iv) Cyril Cabanes, a citizen of Australia and France, v) Saurabh Agarwal, and vi) Deepak Malhotra. The last three are former employees of a Canadian institutional investor.
Statement from Adani
Meanwhile, Adani Green, in a regulatory filing, said, “The United States Department of Justice and the United States Securities and Exchange Commission have issued a criminal indictment and brought a civil complaint, respectively, in the United States District Court for the Eastern District of New York, against our Board members, Gautam Adani and Sagar Adani. The United States Department of Justice have also included our Board member, Vneet Jaain, in such criminal indictment. In light of these developments, our subsidiaries have presently decided not to proceed with the proposed USD denominated bond offerings.”
Charges by US prosectors: ‘Defendants presumed innocent unless and until proven guilty’
The US Attorney’s, in a release, said, 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, it added, Gautam 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 US 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),” the release stated.
During this same period, it said, 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 US 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,” the release said, while adding that the three defendants 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 indictment further alleged that Cyril Cabanes, Saurabh Agarwal, Deepak Malhotra and Rupesh Agarwal conspired to obstruct the grand jury, FBI and US Securities and Exchange Commission (SEC) investigations into the Bribery Scheme, and 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,” the press release stated.