While visiting the United States in March 2023, Sagar Adani, the nephew of Indian billionaire tycoon Gautam Adani, was suddenly approached by FBI agents who were part of an alleged years-long kickback scheme involving the Adani Group’s renewables business. His electronic devices were seized as part of a wider investigation.
Nearly 20 months later, U.S. authorities have uncovered bribery charges against Sagar, 30, and his uncle, a highly influential business leader who is Asia’s second-richest man and largely his Indian counterpart. He has a close relationship with Prime Minister Narendra Modi.
Criminal and civil cases allege that Adani family members and group leaders, along with former executives of Indian renewables company Azure Power and Canadian pension fund CDPQ, paid $265 million in bribes to Indian officials to secure solar contracts. Planned to give. The scheme was allegedly hidden from US banks and investors from which Adani raised billions of dollars.
According to the criminal indictment, Gautam Adani, 62, personally met three times in 2021 with a top government official in the southern state of Andhra Pradesh to help officials seal power supply deals with power distribution companies. “Encourage corruption” to help.
At his group’s headquarters in Ahmedabad, western India, the billionaire himself reportedly presented “several options” for ways to hide bribes.
The allegations are an unprecedented threat to the Adani group, which has resumed ambitious domestic and overseas expansion efforts following separate allegations of corporate fraud leveled against it by short seller Hindenburg Research last year.
“It’s more serious than the Hindenburg report,” said Bhaskar Chakraborty, dean of global business at The Fletcher School at Tufts University. “This will definitely lead to a reduction in Adani’s fundraising from international investors.”
Adani Group termed the allegations as “baseless” and said it was exploring all “possible legal avenues”. CDPQ, an Adani shareholder, said it was cooperating with US authorities and had fired named employees last year. Azure said the former executives cited in the allegations had been “separated” from the company for more than a year and that it was cooperating with US agencies.
Adani’s country-wide group has built one of India’s largest renewables businesses as Modi’s government pushes ahead with ambitious plans to meet half of its energy needs from green sources by 2030.
The indictment, filed by the U.S. Attorney’s Office in Brooklyn and the Securities and Exchange Commission, alleges that renewables business Adani Green, under its executive director Sagar Adani, engaged in solar contracts with Indian government entities between 2020 and 2024. Tried “lucrative” bribes to win supply contracts.
These include an agreement with the state-run Solar Energy Corporation of India (SECI) to purchase 7,000 MW of power generation capacity in Andhra Pradesh.
Gautam and Sagar Adani, along with Adani Green managing director Vineet Jain, as well as former Azure executives, were accused of “corruptly offering” and bribing officials to win power contracts with state power companies from Andhra Pradesh to north Kashmir. Conspired. Criminal indictment.
The SEC alleged that the power purchase agreements were executed only by the state-owned solar company when Adani “incentivized Indian state government officials to enter into contracts with SECI to purchase power at above market prices.” started a big bribery scheme to give”.
To keep track of their arrangements, Sagar Adani used his mobile phone to share specific details of bribes offered to government officials. It said that Jain, before a meeting with a former Azure executive in New Delhi in April 2022, had photographed a document summarizing the amount of bribes that Adani would forward.
A former Azure executive also created PowerPoint presentations and Excel spreadsheets to help CDPQ executives analyze the best “corrupt payment option,” the criminal indictment said.
According to the criminal charges, some of the defendants used code names, calling Gautam Adani “Mr. A”, “The Big Man” and “Numbro Uno”. He also called Jane “Snake” or “Number Uno Minus One”.
Another major allegation against Adani and Jain is that they provided “false and misleading” information about their involvement in bribery when they went to the US to get dollar funding from investors and financial institutions. were gone
According to the criminal indictment, proceeds from the 2021 dollar bond issue were directly related to capital spending needs for various projects, including a “corrupt” scheme.
In its separate civil charge, the SEC said Gautham and Sagar Adani had over the years “positioned Adani Green to investors and the public as a leader among its peers and within India in the principles of good corporate governance.” , which highlighted Adani Green’s allegedly strict anti-bribery policies and practices”.
They “leveraged this narrative” to sell about $1 billion worth of Adani green bonds and notes to US investors in September 2021.
When former Azure and CDPQ executives were contacted by U.S. authorities, the defendants tried to withhold “significant information” about Indian corruption efforts, according to the criminal charges. The charges said the executives made selective disclosures to investigators, revealing Adani’s requests for bribes “but concealing their own participation”.
Azure and CDPQ executives reportedly deleted electronic messages and PowerPoint presentations, while in 2023 meetings with the FBI and SEC they denied involvement in Indian bribery efforts. “This strategy was designed to make it appear that the co-conspirators were reporting misconduct rather than committing misconduct.”
Soon after Sagar Adani was contacted by the FBI last year, Gautam Adani “emailed himself images of every page of the search warrant execution and grand jury appearance” on his nephew, the criminal indictment. Accordingly, it is alleged that the tycoon withheld this information. Investors and banks.
Prosecutors noted that the Adani Group said the conglomerate was “unaware” of any investigation against its chairman following media reports this year that a US investigation was underway against the tycoon.
The group’s head of corporate finance is also accused of sending more than a dozen emails to multiple investors and financial institutions in March 2024 calling the news “baseless” and “malicious”. “Was.
Adani Green suspended a planned $600 million bond issue for this week early Thursday morning Indian time after news of the allegations prompted a big selloff in the group’s 10 listed stocks.
Abhay Aggarwal, founder and managing director of Mumbai-based fund manager Piper Serika Advisors, said the decline in Adani Group shares was “like a reaction” to the damaging Hindenburg allegations last year. “If this affects the group’s ability to raise new capital to fund its projects, it will be a huge negative.”
However, with Adani’s strong backing at home and extensive control over India’s critical infrastructure, Chakraborty at Tufts expects the billionaire to “take it as far as he did when the Hindenburg Report came out. Tha” even if it restricts their travel outside India.
“Will he be extradited? I don’t think that’s likely,” Chakraborty said. “At least not with the current administration in power.”
