New York — An Indian businessman who is one of the world’s richest men has been indicted in the US on charges of defrauding investors by concealing that his major solar power project on the continent was controlled by allegations of bribery.
In charges filed by New York federal prosecutors on Wednesday, Adani, 62, was charged with wire fraud and conspiracy to commit wire fraud. The case involves the beneficial arrangement of Adani Green Energy Ltd. and another company to sell 12 gigawatts of solar power to the Indian government—enough to light millions of homes and businesses.
The lawsuit portrays Adani and its co-defendants as playing both sides of the deal, which it presents as a good and above-board deal for Wall Street investors who have poured billions of dollars into the project over the past five years. Back in India, they allegedly paid or planned to bribe government officials to the tune of $265 million to help secure multi-billion dollar contracts and financing.
This tycoon and his associates want to “obtain and finance large government electricity supply contracts through corruption and fraud using American investors,” said Deputy Assistant Attorney General Lisa Miller.
Adani’s company in India did not immediately comment, as shares of the Adani corporate empire fell on Thursday in India.
Online court records did not list an attorney who could speak for Adani. An email message seeking comment was left with his corporate arm, the Adani Group. Emails were also sent to the lawyers representing the defendants.
US Attorney Breon Peace said the defendants “planned a complex scheme” and sought to “enrich themselves at the expense of the integrity of our financial markets.”
Read more: Adani’s Trouble Could Drive Clean Investors Out of India
In a similar civil action, the US Securities and Exchange Commission accused Adani and two co-defendants of violating anti-fraud provisions of US securities laws. The regulator is seeking monetary penalties and other sanctions.
Both cases were filed in federal court in Brooklyn.
Defendants along with Adani include his nephew Sagar Adani, the executive director of Adani Green Energy’s board, and Vneet Jaain, who was the company’s chief executive officer from 2020 to 2023 and is now a managing director on its board.
Sagar Adani’s attorney, Sean Hecker, declined to comment. Others were not quick to respond.
Sanjay Wadhwa, acting director of the SEC’s Enforcement Division, said Gautam and Sagar Adani were accused of persuading investors to buy their company’s bonds by lying “not only that Adani Green had a strong bribery compliance program but that the company’s top executives did not and would not pay or promise bribes.” “
Adani is a powerful player in the world’s most populous nation. He made his fortune in the coal business in the 1990s. The Adani group grew to encompass many aspects of Indian life, from manufacturing defense equipment to building roads to selling cooking oil.
Read more: The Adani Group Saga Is Far From Over
In recent years, the Adani Group has made great strides in renewable energy, adopting a philosophy of sustainable growth reflected in its motto: “Growing Rightly.”
The company has a clean energy portfolio of more than 20 gigawatts, including one of the world’s largest solar power plants in the southern state of Tamil Nadu. The Adani Group has set its sights on becoming the country’s largest player in the space by 2030. By 2022, Gautam Adani said the company will invest $70 billion in clean energy projects by 2032.
Adani’s close relationship with the government and Prime Minister Narendra Modi has at one time drawn criticism, including from India’s opposition leader Jairam Ramesh. In a statement he said the case “comes with a long record of fraud and crimes committed with impunity under the apparent protection of the Prime Minister.”
Noting that it takes foreign authorities to bring charges, Ramesh called for a parliamentary inquiry into Adani’s activities.
Last year, Hindenburg Research, a US-based financial research firm accused Adani and his company of “absurd stock manipulation” and “accounting fraud.” The Adani Group called the allegations “a vicious combination of selective misinformation and old, baseless and unsubstantiated allegations.”
Read more: Adani Responds After Fraud Allegations. But The Real Victim Could Be India’s Shadow
Hindenburg is known as a short seller, a Wall Street term for traders who basically bet that certain stock prices will fall, and made such an investment in relation to the Adani Group. The company’s stock plummeted as a result and plunged again in August when Hindenburg pressed further charges of corruption.
Jaain told The Associated Press last year that Hindenburg’s allegations had little impact on Adani’s ongoing plans, including work to build a 20-gigawatt solar and wind project in the northwestern Indian town of Khavda.
Prosecutors say Adani and his co-defendants began planning a bribery scheme in 2020 or 2021 to ensure demand for power from Adani Green and another company they contracted to produce for India’s national government Solar Energy Corporation.
Adani Green and the company’s high prices have turned off India’s state-run electricity distributors, which buy power from the national government and supply it to homes and businesses. But the companies needed those deals to make the project profitable and keep revenue high, so they offered bribes to make it happen, prosecutors said.
After the defendants began promising to bribe government officials, in 2021 and 2022, electricity distributors in five Indian states or regions made deals to buy their power, prosecutors said. Adani’s company issued a statement touting its deals as the “world’s largest” power purchase agreement.
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