New York
CNN
—
Indian billionaire Gautam Adani, along with several key executives, was formally indicted in New York for their alleged involvement in a multi-billion-dollar fraud scheme, as announced by the US Department of Justice on Wednesday.
Authorities outlined that Adani, alongside seven other high-ranking business figures—including his nephew, Sagar Adani—allegedly promised more than $250 million in bribes to influential Indian government officials in a bid to secure lucrative solar energy contracts.
These illegal bribes were reportedly designed “to mislead investors and banks in order to amass billions of dollars and to hinder justice,” Deputy Assistant Attorney General Lisa Miller noted in a statement issued on Wednesday.
Valued at over $85 billion, Adani currently ranks as the second richest person in Asia, trailing only his fellow countryman Mukesh Ambani, according to data provided by Bloomberg’s Billionaires Index. He is the founder and chair of the extensive Indian conglomerate Adani Group.
The contracts associated with the solar energy projects were anticipated to generate over $2 billion in post-tax profits over the span of approximately two decades.
Details from the investigation reveal that Adani personally met with an Indian government official as part of this fraudulent scheme, which was carried out between 2020 and 2024. The group of defendants frequently convened to strategize about their bribery tactics, exchanging critical evidence via various mobile devices.
The documentation uncovered in the investigation included a cell phone that meticulously tracked specific bribe-related activities, a photograph outlining various bribe amounts, along with PowerPoint and Excel documents analyzing potential methods for executing and concealing these illicit payments, according to the DOJ.
In their efforts to disguise these bribery actions from US investors, Adani and his associates aimed to secure financing, which was essential for funding the solar energy contracts that were allegedly obtained through corrupt practices, as stated by the DOJ.
In a related legal pursuit, the Securities and Exchange Commission charged both Adani and his nephew, Sagar Adani, along with Cyril Cabanes, an executive at Azure Power Global. The SEC alleged that their bribery conspiracies enabled their respective firms to profit from a highly lucrative contract awarded by the Indian government. According to the SEC, Adani Green Energy raised upwards of $175 million from US investors based on the misleading information provided.
In January 2023, the US short-selling firm Hindenburg Research accused Adani of engaging in a “brazen stock manipulation and accounting fraud scheme.” Following those allegations, Adani’s fortune—previously at one point eclipsing that of Jeff Bezos in 2022—dropped by more than $80 billion.
Currently, his net worth is pegged at $85.5 billion according to Bloomberg’s Billionaires Index.
Hindenburg’s investigation reportedly spanned two years, during which they scrutinized the “sky-high valuations” attributed to Adani’s companies and raised alarms about their “substantial debt,” suggesting that this situation placed the entire Adani Group in a perilously vulnerable financial condition. Short-sellers typically profit by betting against a stock’s value.
In response, the Adani Group issued a comprehensive 400-page rebuttal, characterizing the Hindenburg analysis as “nothing but a lie.”
Adani has long been recognized as a close ally of Indian Prime Minister Narendra Modi, and he first entered the business world through diamond trading. He established a commodity trading enterprise in 1988, which later evolved into Adani Enterprises. The conglomerate now boasts operations in critical sectors including ports, power generation, media, and sustainable energy.
CNN has reached out to Adani Enterprises for comment.
How might the indictment of Gautam Adani affect investor confidence in the Adani Group and corporate governance in India?
**Interview with Dr. Rahul Mehta, Financial Analyst and Author**
**Interviewer:** Welcome, Dr. Mehta. Thank you for joining us today. Recently, Indian billionaire Gautam Adani has been indicted in New York on charges related to a massive fraud scheme. Can you provide us with an overview of the allegations against him?
**Dr. Mehta:** Thank you for having me. The allegations are quite serious indeed. Gautam Adani, along with several other executives, is accused of participating in a scheme where they allegedly promised over $250 million in bribes to influential Indian government officials. This was purportedly done to secure lucrative solar energy contracts which could potentially generate more than $2 billion in profits. They’re facing charges of misleading investors and banks to amass significant funds through this fraudulent activity[[1](https://www.nytimes.com/2024/11/20/technology/gautam-adani-bribery-charges.html)].
**Interviewer:** That’s alarming. What specific actions did the investigation reveal about how these bribes were conducted?
**Dr. Mehta:** The investigation uncovered a range of practices. For instance, it was found that Adani personally met with a government official to assist in the scheme. The group of defendants did more than just discuss bribery; they allegedly strategized meticulously. Evidence included a cell phone that recorded their activities, documents outlining bribe amounts, and even PowerPoint presentations analyzing ways to execute these payments without detection. It appears they were very methodical in trying to conceal their actions from regulatory bodies and investors[[1](https://www.nytimes.com/2024/11/20/technology/gautam-adani-bribery-charges.html)].
**Interviewer:** This paints a troubling picture of corporate governance within the Adani Group. Given that Adani is one of the richest individuals in Asia, how do you think this indictment will impact his business empire?
**Dr. Mehta:** The implications could be significant. Adani’s reputation is at stake, and with it, the trust of investors may rapidly diminish. The Adani Group has grown extensively, holding interests across various sectors including energy and infrastructure. If investors perceive a risk related to corruption or mismanagement, it could lead to a drop in stock prices, loss of funding, and potentially the deterioration of business operations. Additionally, legal battles can be costly and time-consuming, further compounding potential losses[[1](https://www.nytimes.com/2024/11/20/technology/gautam-adani-bribery-charges.html)].
**Interviewer:** What do you think the broader implications are for corporate governance in India, especially in light of this scandal?
**Dr. Mehta:** This situation could serve as a wake-up call for not just Indian corporations but for global businesses at large. It highlights the necessity for transparency and ethical practices, especially in regions where corruption may be more prevalent. There’s a growing demand for enhanced regulatory frameworks and stronger enforcement of anti-corruption laws. This indictment might prompt other companies to reassess their governance policies and compliance measures to avoid similar pitfalls[[1](https://www.nytimes.com/2024/11/20/technology/gautam-adani-bribery-charges.html)].
**Interviewer:** Thank you, Dr. Mehta, for your insights on this developing story. It’s certainly a situation that bears watching as it unfolds.
**Dr. Mehta:** My pleasure, and thank you for bringing attention to such an important topic.
**End of Interview**
