Gautam Adani: Billionaire Indian tycoon facing US bribery charges
AFP
November 21, 2024
Gautam Adani has been charged by US prosecutors with paying more than $250 million in bribes to Indian officials for lucrative solar energy supply contracts - Copyright AFP Sam PANTHAKY
Billionaire Indian industrialist Gautam Adani, whose business empire has been rocked by US bribery charges against him, is one of the corporate world’s great survivors.
The tycoon — a close ally of Hindu nationalist Prime Minister Narendra Modi — oversees a vast conglomerate encompassing coal, airports, cement and media operations.
The US court charges that he paid hundreds of millions of dollars in bribes sent his companies’ shares plunging. But Adani has seen off big threats before.
On New Year’s Day in 1998, Adani and an associate were reportedly kidnapped by gunmen demanding a $1.5 million ransom, before being later released at an unknown location.
A decade later, he was dining at Mumbai’s Taj Mahal Palace hotel when it was besieged by militants, who killed 160 people in one of India’s worst terror attacks.
Trapped with hundreds of others, Adani reportedly hid in the basement all night before he was rescued by security personnel early the next morning.
“I saw death at a distance of just 15 feet,” he said of the experience after his private aircraft landed in his hometown Ahmedabad later that day.
Adani, 62, differs from his peers among India’s mega-rich, many of whom are known for throwing lavish birthday and wedding celebrations that are later splashed across newspaper gossip pages.
A self-described introvert, he keeps a low profile and rarely speaks to the media, often sending lieutenants to front corporate events.
“I’m not a social person that wants to go to parties,” he told the Financial Times in a 2013 interview.
– ‘Stop Adani’ –
Gautam Adani, whose empire has been rocked by panic-selling and allegations of fraud, is one of the business world’s great survivors – Copyright AFP INDRANIL MUKHERJEE
Adani was born in Ahmedabad, Gujarat state, to a middle-class family but dropped out of school at 16 and moved to financial capital Mumbai to find work in the lucrative gems trade.
After a short stint in his brother’s plastics business, he launched the flagship family conglomerate that bears his name in 1988 by branching out into the export trade.
His big break came seven years later with a contract to build and operate a commercial shipping port in Gujarat.
It grew to become India’s largest at a time when most ports were government-owned — the legacy of a sclerotic economic planning system that impeded growth for decades and was in the process of being dismantled.
Adani in 2009 expanded into coal, a lucrative sector for a country still almost totally dependent on fossil fuels to meet its energy needs, but a decision that brought greater international scrutiny as he rose rapidly up India’s rich list.
His purchase the following year of an untapped coal basin sparked years of “Stop Adani” protests in Australia after dismay at the project’s monumental environmental impact.
Similar controversies plagued his coal projects in central India, where forests home to tribal communities were cut down for mining operations.
– ‘Extraordinary growth’ –
Adani is considered to be close to Prime Minister Modi, a fellow Gujarat native, and offered the leader the use of a private company jet during the 2014 election campaign that swept him to power.
The tycoon has invested in the government’s strategic priorities, in recent years inaugurating a green energy business with ambitious targets.
In 2022, he completed a hostile takeover of broadcaster NDTV, a television news service considered one of the few media outlets willing to outwardly criticise Modi.
Adani batted away press freedom fears, but told the Financial Times that journalists should have the “courage” to say “when the government is doing the right thing every day”.
Last year a bombshell report from US investment firm Hindenburg Research claimed the conglomerate had engaged in a “brazen stock manipulation and accounting fraud scheme over the course of decades”.
Hindenburg said a pattern of “government leniency towards the group” stretching back decades had left investors, journalists, citizens and politicians unwilling to challenge its conduct “for fear of reprisal”.
Adani Group denied wrongdoing and characterised the report as a “calculated attack on India” but lost $150 billion in market capitalisation in the weeks after the report’s release.
Its founder saw his own net worth plunge by $60 billion over the same period, and he is now ranked by Forbes as the 25th-richest person globally.
US prosecutors on Wednesday charged the tycoon and two other board members with paying hundreds of millions of dollars in bribes and hiding the payments from investors.
The indictment accuses Adani Group’s leadership of bribing Indian government officials to secure lucrative government contracts.
The conglomerate and its founder have yet to respond to the charges.
How Indian billionaire Gautam Adani’s alleged bribery scheme took off and unraveled
Indian billionaire Gautam Adani speaks during an inauguration ceremony after the Adani Group completed the purchase of Haifa Port in Israel on Jan. 31, 2023.(REUTERS/File Photo)
https://arab.news/pjuk8
Updated 50 sec ago
Reuters
November 22, 20240
Gautam Adani allegedly tried to bribe local officials in India to persuade them to buy electricity produced by his renewable energy company Adani Green Energy
The allegations caught the attention of US watchdog agencies as Adani’s companies were raising funds from US-based investors in several transactions starting in 2021
NEW YORK: In June of 2020, a renewable energy company owned by Indian billionaire Gautam Adani won what it called the single largest solar development bid ever awarded: an agreement to supply 8 gigawatts of electricity to a state-owned power company.
But there was a problem. Local power companies did not want to pay the prices the state company was offering, jeopardizing the deal, according to US authorities. To save the deal, Adani allegedly decided to bribe local officials to persuade them to buy the electricity.
That allegation is at the heart of US criminal and civil charges unsealed on Wednesday against Adani, who is not currently in US custody and is believed to be in India. His company, Adani Group, said the charges were “baseless” and that it would seek “all possible legal recourse.”
The alleged hundreds of millions of dollars in bribes promised to local Indian officials caught the attention of the US Justice Department and Securities and Exchange Commission as Adani’s companies were raising funds from US-based investors in several transactions starting in 2021.
This account of how the alleged scheme unfolded is drawn from federal prosecutors’ 54-page criminal indictment of Adani and seven of his associates and two parallel civil SEC complaints, which extensively cite electronic messages between the scheme’s alleged participants.
In early 2020, the Solar Energy Corporation of India awarded Adani Green Energy and another company, Azure Power Global, contracts for a 12-gigawatt solar energy project, expected to yield billions of dollars in revenue for both companies, according to the indictment.
It was a major step forward for Adani Green Energy, run by Adani’s nephew, Sagar Adani. Up until that point, the company had only earned roughly $50 million in its history and had yet to turn a profit, according to the SEC complaint.
Sagar Adani and the Azure CEO at the time discussed the delays and hinted at bribes on the encrypted messaging application WhatsApp, according to the SEC.
When the Azure CEO wrote on Nov. 24, 2020, that the local power companies “are being motivated,” Sagar Adani allegedly replied, “Yup ... but the optics are very difficult to cover. In February 2021, Sagar Adani allegedly wrote to the CEO, “Just so you know, we have doubled the incentives to push for these acceptances.”
The SEC did not name the Azure CEO as a defendant, but Azure’s securities filings show the CEO at the time was Ranjit Gupta.
Gupta was charged by the Justice Department with conspiracy to violate an anti-bribery law. He did not immediately respond to a request for comment.
Azure said on Thursday it was cooperating with the US investigations, and that the individuals involved with the accusations had left the company more than a year ago.
‘Sudden good fortune’
In August of 2021, Gautam Adani had the first of several meetings with an official in the southern state of Andhra Pradesh, to whom he allegedly ultimately promised $228 million in bribes in exchange for agreeing to have the state buy the power, according to the Justice Department’s indictment.
By December, Andhra Pradesh had agreed to buy the power, and other states with smaller contracts soon followed. Other states’ officials were promised bribes as well, US authorities said.
During a Dec. 6, 2021 meeting at a coffee shop, Azure executives allegedly discussed “rumors that the Adanis had somehow facilitated signing” of the deals, according to the SEC.
Gautam Adani said on Dec. 14, 2021, the company was on track “to become the world’s largest renewables player by 2030.”
“The sudden good fortune for Azure and Adani Green prompted speculation in the marketplace about the contract awards,” the SEC wrote in its complaint.
Letter from the SEC
Before long, the SEC began to probe. The agency sent a “general inquiry” letter to Azure — which at the time traded on the New York Stock Exchange — on March 17, 2022, asking about its recent contracts and if foreign officials had sought anything of value, according to the Justice Department indictment.
According to the Department of Justice, Gautam Adani told representatives of Azure during a meeting in his Ahmedabad, India office the next month that he expected to be reimbursed more than $80 million for the bribes he had paid officials that ultimately benefited Azure’s contracts.
Some Azure representatives and a leading investor in the company decided to pay Adani back by allowing his company to take over a potentially profitable project. The representatives and investor allegedly agreed to tell Azure’s board of directors that Adani had requested bribe money, but hid their role in the scheme, prosecutors said.
All the while, Adani’s companies were raising billions of dollars in loans and bonds through international banks, including from US investors. In four separate fundraising transactions between 2021 and 2024, the companies sent investors documents indicating that they had not paid bribes — statements prosecutors say are false and constitute fraud.
FBI search
During a visit to the United States on March 17, 2023, FBI agents seized Sagar Adani’s electronic devices. The agents handed him a search warrant from a judge indicating that the US government was investigating potential violations of fraud statutes and the Foreign Corrupt Practices Act.
According to prosecutors, Gautam Adani emailed himself photographs of each page of the search warrant on March 18, 2023.
His companies nonetheless went through with a $1.36 billion syndicated loan agreement on Dec. 5, 2023, and another sale of secured notes in March 2024, and once again furnished investors with misleading information about their anti-bribery practices, according to prosecutors.
On Oct. 24, federal prosecutors in Brooklyn secured a secret grand jury indictment against Gautam Adani, Sagar Adani, Gupta, and five others allegedly involved in the scheme.
The indictment was unsealed on Nov. 20, prompting a $27 billion plunge in Adani Group companies’ market value. Adani Green Energy promptly canceled a scheduled $600 million bond sale.
Indian billionaire Gautam Adani speaks during an inauguration ceremony after the Adani Group completed the purchase of Haifa Port in Israel on Jan. 31, 2023.(REUTERS/File Photo)
https://arab.news/pjuk8
Updated 50 sec ago
Reuters
November 22, 20240
Gautam Adani allegedly tried to bribe local officials in India to persuade them to buy electricity produced by his renewable energy company Adani Green Energy
The allegations caught the attention of US watchdog agencies as Adani’s companies were raising funds from US-based investors in several transactions starting in 2021
NEW YORK: In June of 2020, a renewable energy company owned by Indian billionaire Gautam Adani won what it called the single largest solar development bid ever awarded: an agreement to supply 8 gigawatts of electricity to a state-owned power company.
But there was a problem. Local power companies did not want to pay the prices the state company was offering, jeopardizing the deal, according to US authorities. To save the deal, Adani allegedly decided to bribe local officials to persuade them to buy the electricity.
That allegation is at the heart of US criminal and civil charges unsealed on Wednesday against Adani, who is not currently in US custody and is believed to be in India. His company, Adani Group, said the charges were “baseless” and that it would seek “all possible legal recourse.”
The alleged hundreds of millions of dollars in bribes promised to local Indian officials caught the attention of the US Justice Department and Securities and Exchange Commission as Adani’s companies were raising funds from US-based investors in several transactions starting in 2021.
This account of how the alleged scheme unfolded is drawn from federal prosecutors’ 54-page criminal indictment of Adani and seven of his associates and two parallel civil SEC complaints, which extensively cite electronic messages between the scheme’s alleged participants.
In early 2020, the Solar Energy Corporation of India awarded Adani Green Energy and another company, Azure Power Global, contracts for a 12-gigawatt solar energy project, expected to yield billions of dollars in revenue for both companies, according to the indictment.
It was a major step forward for Adani Green Energy, run by Adani’s nephew, Sagar Adani. Up until that point, the company had only earned roughly $50 million in its history and had yet to turn a profit, according to the SEC complaint.
The logo of the Adani Group is seen on the facade of its Corporate House on the outskirts of Ahmedabad, India, on November 21, 2024. (REUTERS)
But the initiative soon hit roadblocks. Local state electricity distributors were reluctant to commit to buying the new solar power, expecting prices to fall in the future, according to an April 7, 2021 report by the Institute for Energy Economics and Financial Analysis, a think tank.
But the initiative soon hit roadblocks. Local state electricity distributors were reluctant to commit to buying the new solar power, expecting prices to fall in the future, according to an April 7, 2021 report by the Institute for Energy Economics and Financial Analysis, a think tank.
Sagar Adani and the Azure CEO at the time discussed the delays and hinted at bribes on the encrypted messaging application WhatsApp, according to the SEC.
When the Azure CEO wrote on Nov. 24, 2020, that the local power companies “are being motivated,” Sagar Adani allegedly replied, “Yup ... but the optics are very difficult to cover. In February 2021, Sagar Adani allegedly wrote to the CEO, “Just so you know, we have doubled the incentives to push for these acceptances.”
The SEC did not name the Azure CEO as a defendant, but Azure’s securities filings show the CEO at the time was Ranjit Gupta.
Gupta was charged by the Justice Department with conspiracy to violate an anti-bribery law. He did not immediately respond to a request for comment.
Azure said on Thursday it was cooperating with the US investigations, and that the individuals involved with the accusations had left the company more than a year ago.
‘Sudden good fortune’
In August of 2021, Gautam Adani had the first of several meetings with an official in the southern state of Andhra Pradesh, to whom he allegedly ultimately promised $228 million in bribes in exchange for agreeing to have the state buy the power, according to the Justice Department’s indictment.
By December, Andhra Pradesh had agreed to buy the power, and other states with smaller contracts soon followed. Other states’ officials were promised bribes as well, US authorities said.
During a Dec. 6, 2021 meeting at a coffee shop, Azure executives allegedly discussed “rumors that the Adanis had somehow facilitated signing” of the deals, according to the SEC.
Gautam Adani said on Dec. 14, 2021, the company was on track “to become the world’s largest renewables player by 2030.”
“The sudden good fortune for Azure and Adani Green prompted speculation in the marketplace about the contract awards,” the SEC wrote in its complaint.
Letter from the SEC
Before long, the SEC began to probe. The agency sent a “general inquiry” letter to Azure — which at the time traded on the New York Stock Exchange — on March 17, 2022, asking about its recent contracts and if foreign officials had sought anything of value, according to the Justice Department indictment.
According to the Department of Justice, Gautam Adani told representatives of Azure during a meeting in his Ahmedabad, India office the next month that he expected to be reimbursed more than $80 million for the bribes he had paid officials that ultimately benefited Azure’s contracts.
Some Azure representatives and a leading investor in the company decided to pay Adani back by allowing his company to take over a potentially profitable project. The representatives and investor allegedly agreed to tell Azure’s board of directors that Adani had requested bribe money, but hid their role in the scheme, prosecutors said.
All the while, Adani’s companies were raising billions of dollars in loans and bonds through international banks, including from US investors. In four separate fundraising transactions between 2021 and 2024, the companies sent investors documents indicating that they had not paid bribes — statements prosecutors say are false and constitute fraud.
FBI search
During a visit to the United States on March 17, 2023, FBI agents seized Sagar Adani’s electronic devices. The agents handed him a search warrant from a judge indicating that the US government was investigating potential violations of fraud statutes and the Foreign Corrupt Practices Act.
According to prosecutors, Gautam Adani emailed himself photographs of each page of the search warrant on March 18, 2023.
His companies nonetheless went through with a $1.36 billion syndicated loan agreement on Dec. 5, 2023, and another sale of secured notes in March 2024, and once again furnished investors with misleading information about their anti-bribery practices, according to prosecutors.
On Oct. 24, federal prosecutors in Brooklyn secured a secret grand jury indictment against Gautam Adani, Sagar Adani, Gupta, and five others allegedly involved in the scheme.
The indictment was unsealed on Nov. 20, prompting a $27 billion plunge in Adani Group companies’ market value. Adani Green Energy promptly canceled a scheduled $600 million bond sale.
UK sanctions Angola’s Isabel dos Santos in graft crackdown
By AFP
November 21, 2024
Isabel Dos Santos is one of three people dubbed 'infamous kleptocrats' by the UK government - Copyright AFP/File Patrick T. Fallon
The UK government on Thursday announced sanctions on Angola’s Isabel dos Santos, the billionaire businesswoman and daughter of the country’s former president, as part of a new anti-corruption drive.
It also sanctioned Dmytro Firtash, a Ukrainian tycoon with links to the Kremlin, and Aivars Lembergs, one of Latvia’s richest people, who is accused of abusing his political position to commit bribery and money laundering, the foreign ministry said.
They are all subject to travel bans and asset freezes, it added in a statement, calling them “three infamous kleptocrats” and accusing them of “stealing their countries’ wealth for personal gain”.
Dos Santos, the ministry said, had “systematically abused her positions at state-run companies to embezzle at least £350 million ($443 million), depriving Angola of resources and funding for much-needed development”.
Considered Africa’s richest woman, she is currently wanted by Angolan authorities investigating alleged illegalities in the management of national oil company Sonangol between 2016 and 2017.
Her father, Jose Eduardo dos Santos, who died in 2022, ruled energy-rich Angola for 38 years until 2017.
She was sanctioned by the United States in 2021 for “involvement in significant corruption” and is barred from entering the United States.
Responding to the UK decision Thursday, dos Santos said that it was “incorrect and unjustified” and that she “intends to appeal”.
“I hope that the United Kingdom will give me the opportunity to present my evidence and prove these lies fabricated against me by the Angolan regime,” she said in a statement released in Portuguese.
“No court has found me guilty of corruption or bribery,” she added. “We are facing another step in Angola’s politically motivated campaign of persecution against me and my family.”
– ‘Ill-gotten gains’ –
Firtash is a one-time ally of ousted pro-Russian Ukrainian president Viktor Yanukovych.
He is currently in Austria fighting extradition to the United States, where he is wanted on bribery and racketeering charges.
In June 2021, Ukrainian President Volodymyr Zelensky signed a decree imposing sanctions on Firtash, including the freezing of his assets and withdrawal of licences from his companies, after accusing him of selling titanium products to Russian military companies.
“(Firtash) extracted hundreds of millions of pounds from Ukraine through corruption and his control of gas distribution and has hidden tens of millions of pounds of ill-gotten gains in the UK property market alone,” the UK government statement added.
Sanctions would also be imposed on his wife, Lada Firtash, and UK-based Denis Gorbunenko, a UK-based financial “fixer”.
Lembergs, a former mayor, is accused of bribery and money laundering. His daughter, Liga Lemberga, is also sanctioned.
In 2021, a Riga court found him guilty of 19 charges including extorting bribes, forging documents, money laundering and improper use of office.
The measures are the latest under 2021 anti-corruption sanctions legislation brought in by the previous Conservative administration.
“These unscrupulous individuals selfishly deprive their fellow citizens of much-needed funding for education, healthcare and infrastructure — for their own enrichment,” said Foreign Secretary David Lammy, a member of the UK’s new Labour government elected in July.
”I committed to taking on kleptocrats and the dirty money that empowers them when I became Foreign Secretary… The tide is turning. The golden age of money laundering is over,” he said.
The Conservative government of Boris Johnson announced the first sanctions under its new global anti-corruption regime in 2021.
Britain had previously followed the European Union’s sanctions regime but since leaving the bloc in January 2020 struck out alone with its own policy.
The global anti-corruption sanctions were designed to prevent Britain from being a haven for illicit funds and money laundering.
By AFP
November 21, 2024
Isabel Dos Santos is one of three people dubbed 'infamous kleptocrats' by the UK government - Copyright AFP/File Patrick T. Fallon
The UK government on Thursday announced sanctions on Angola’s Isabel dos Santos, the billionaire businesswoman and daughter of the country’s former president, as part of a new anti-corruption drive.
It also sanctioned Dmytro Firtash, a Ukrainian tycoon with links to the Kremlin, and Aivars Lembergs, one of Latvia’s richest people, who is accused of abusing his political position to commit bribery and money laundering, the foreign ministry said.
They are all subject to travel bans and asset freezes, it added in a statement, calling them “three infamous kleptocrats” and accusing them of “stealing their countries’ wealth for personal gain”.
Dos Santos, the ministry said, had “systematically abused her positions at state-run companies to embezzle at least £350 million ($443 million), depriving Angola of resources and funding for much-needed development”.
Considered Africa’s richest woman, she is currently wanted by Angolan authorities investigating alleged illegalities in the management of national oil company Sonangol between 2016 and 2017.
Her father, Jose Eduardo dos Santos, who died in 2022, ruled energy-rich Angola for 38 years until 2017.
She was sanctioned by the United States in 2021 for “involvement in significant corruption” and is barred from entering the United States.
Responding to the UK decision Thursday, dos Santos said that it was “incorrect and unjustified” and that she “intends to appeal”.
“I hope that the United Kingdom will give me the opportunity to present my evidence and prove these lies fabricated against me by the Angolan regime,” she said in a statement released in Portuguese.
“No court has found me guilty of corruption or bribery,” she added. “We are facing another step in Angola’s politically motivated campaign of persecution against me and my family.”
– ‘Ill-gotten gains’ –
Firtash is a one-time ally of ousted pro-Russian Ukrainian president Viktor Yanukovych.
He is currently in Austria fighting extradition to the United States, where he is wanted on bribery and racketeering charges.
In June 2021, Ukrainian President Volodymyr Zelensky signed a decree imposing sanctions on Firtash, including the freezing of his assets and withdrawal of licences from his companies, after accusing him of selling titanium products to Russian military companies.
“(Firtash) extracted hundreds of millions of pounds from Ukraine through corruption and his control of gas distribution and has hidden tens of millions of pounds of ill-gotten gains in the UK property market alone,” the UK government statement added.
Sanctions would also be imposed on his wife, Lada Firtash, and UK-based Denis Gorbunenko, a UK-based financial “fixer”.
Lembergs, a former mayor, is accused of bribery and money laundering. His daughter, Liga Lemberga, is also sanctioned.
In 2021, a Riga court found him guilty of 19 charges including extorting bribes, forging documents, money laundering and improper use of office.
The measures are the latest under 2021 anti-corruption sanctions legislation brought in by the previous Conservative administration.
“These unscrupulous individuals selfishly deprive their fellow citizens of much-needed funding for education, healthcare and infrastructure — for their own enrichment,” said Foreign Secretary David Lammy, a member of the UK’s new Labour government elected in July.
”I committed to taking on kleptocrats and the dirty money that empowers them when I became Foreign Secretary… The tide is turning. The golden age of money laundering is over,” he said.
The Conservative government of Boris Johnson announced the first sanctions under its new global anti-corruption regime in 2021.
Britain had previously followed the European Union’s sanctions regime but since leaving the bloc in January 2020 struck out alone with its own policy.
The global anti-corruption sanctions were designed to prevent Britain from being a haven for illicit funds and money laundering.
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