The US authorities are taking steps to address the fraud accusations against Adani Group Chairman Gautam Adani, aiming to conclude a case that has persisted for over a year. Sources suggest that the US Justice Department might announce the dismissal of charges as early as this week. Additionally, the Securities and Exchange Commission (SEC) is working towards settling a parallel civil fraud case filed against the billionaire industrialist and others in November 2024.
While the Justice Department is considering dropping the charges due to the defendants being out of the country, resolving the SEC case is likely to involve a financial penalty, according to sources familiar with the situation. The allegations brought forth by the SEC and the Department of Justice claim that the Adanis attempted to pay over $250 million in bribes to Indian officials to secure solar energy contracts. They are also accused of concealing this scheme from US investors and banks during fundraising activities.
Gautam Adani and his nephew Sagar Adani’s legal representatives have argued in court that there is no substantial evidence supporting the alleged bribery scheme. They have emphasized that the SEC lacks jurisdiction over the two individuals and that the purported misstatements forming the basis of the case are not actionable. The Adani Group has refuted all accusations, asserting that neither its entities nor executives have faced charges under the US Foreign Corrupt Practices Act. Additionally, they clarified that Adani Green Energy, the renewable energy division involved in the fundraising, is not part of the legal proceedings.
In a recent development, a US judge granted Gautam Adani’s request for a hearing to dismiss the US SEC’s fraud case. The plea contends that the case represents an improper application of US law beyond its jurisdiction and that the SEC has failed to establish actionable claims under US securities laws. Adani’s legal team has maintained that the case lacks a valid jurisdictional basis and does not present actionable claims under US securities laws.
The legal filings also argue that the SEC’s claims regarding a 2021 bond sale by Adani Green Energy are legally flawed on multiple fronts. The Adani family asserts that the SEC does not have personal jurisdiction over them, as they had limited connections with the US and were not directly involved in the bond issuance. Moreover, they highlight that there were no investor losses, as the bonds were fully repaid in 2024.
The plea further challenges the extraterritorial nature of the SEC’s case, noting that the securities were not traded in the US, the issuer is Indian, and the alleged misconduct occurred solely in India.
