New York/New Delhi, 21 Nov

Billionaire Gautam Adani has been charged by US prosecutors for allegedly being part of a scheme to pay over USD 250 million (about Rs 2,100 crore) bribe to Indian officials in exchange of favourable terms for solar power contracts.

Adani, India's second-richest man, has been charged with bribery and securities fraud in two separate cases brought by US authorities -- a criminal indictment by the US Department of Justice in a New York court that charges him and seven others including his nephew Sagar with paying bribes to unidentified officials of state governments like those in Andhra Pradesh to buy expensive solar power, potentially earn more than USD 2 billion profit over 20 years.

New Delhi-headquartered Azure Power too was part of the alleged bribery scheme, according to the suit. Separately, the US Securities and Exchange Commission also charged Gautam and Sagar Adani and an Azure Power executive with "violating the anti-fraud provisions of the federal securities laws".

While the Adani group did not immediately respond to requests for comments, it scrapped a USD 600-million bond issue by renewable energy arm Adani Green Energy Ltd.

The issue was oversubscribed three times hours before the indictment. "In light of these developments, our subsidiaries have presently decided not to proceed with the proposed USD denominated bond offerings," Adani Green Energy said in a stock exchange filing.

Adani group stocks tanked in Mumbai trade. Ten listed firms of the group lost about USD 30 billion (Rs 2.5 lakh crore) in market value. Gautam Adani was worth USD 85.5 billion and ranked 18th on the world billionaire list prior to the fall in stocks.

The charges in the indictment are allegations and the defendants are presumed innocent unless and until proven guilty.

US authorities allege that the bribes paid were concealed from the US banks and investors from whom the Adani group raised billions of dollars for the projects that were to supply 12 gigawatts of solar power. US law allows pursuing foreign corruption allegations if they involve certain links to American investors or markets.

US authorities allege that between 2020 and 2024, the Adani firm and its subsidiaries raised more than USD 2 billion in US dollar bank loans from international financial institutions and US-based asset management companies and offered more than USD 1 billion in securities underwritten by international financial institutions and sold to investors in the US.

Adani and his co-defendants sought to "obtain and finance massive state energy supply contracts through corruption and fraud at the expense of US investors", Deputy Assistant Attorney General Lisa Miller said.

US Attorney Breon Peace said the defendants "orchestrated an elaborate scheme" and sought to "enrich themselves at the expense of the integrity of our financial markets". US prosecutors charged Adani, 62, and seven others, including nephew Sagar, executives at Adani Green Energy and former employees of a Canadian pension fund, for paying over USD 250 million in bribes between 2020 and 2024.

Gautam and Sagar Adani are accused of persuading investors to buy their company's bonds by misrepresenting "not only that Adani Green had a robust anti-bribery compliance programme but also that the company's senior management had not and would not pay or promise to pay bribes".

Adani, chairman of the ports-to-energy Adani Group, his nephew Sagar R Adani, who is an executive director at the conglomerate's renewable energy arm Adani Green Energy Ltd, and its former CEO Vneet Jaain were charged with securities fraud, securities fraud conspiracy and wire fraud conspiracy. The Adanis were also charged in a US Securities and Exchange Commission (SEC) civil case. The five-count indictment also accuses Sagar and Jaain of breaking federal laws.

The US authorities also charged three former employees of a large Canadian pension fund, CDPQ, in connection with the alleged scheme, saying they obstructed an investigation into the bribes by deleting emails and agreeing to provide false information to the US government.

CDPQ, which invests in infrastructure projects, is a shareholder in Adani companies. The indictment may throw the conglomerate again in a turmoil just as it rebounded from US short seller Hindenburg Reseach's damning fraud allegations.

Hindenburg allegations of "brazen stock manipulation and accounting fraud" in January 2023 had led to the conglomerate seeing USD 150 billion wipeout in market value at its lowest point. The group stocks have since recovered most of the losses.

Adani Group had denied all allegations made by Hindenburg. A school dropout, Gautam Adani founded his namesake group in 1988 as a commodities trading firm, and built a business empire that now spans airports, shipping ports, power generation, energy transmission and mining companies.

"Specifically, on or about 17 March, 2023, FBI special agents approached Sagar Adani in the United States and pursuant to a judicially authorised search warrant, took custody of electronic devices in his possession," the court document said.

Some conspirators, according to the documents, referred privately to Gautam Adani with the code names "Numero uno" and "the big man", while his nephew allegedly used his cellphone to track specifics about the bribes. "On or about 18 March, 2023, the defendant Gautam S Adani emailed himself photographs of each page of the search warrant executed and grand jury subpoena served on the defendant Sagar R Adani," it said.

Others who were criminally charged include Ranjit Gupta and Rupesh Agarwal, respectively a former CEO and former chief strategy and commercial officer of Azure Power Global, which, authorities said, agreed to pay some of the bribes.

The complaint charges them with violating the anti-fraud provisions of the federal securities laws and seeks permanent injunctions, civil penalties, and officer and director bars.

During the alleged scheme, Adani Green raised more than USD 175 million from US investors and Azure Power's stock was traded on the New York Stock Exchange, the SEC said in a statement.

Simultaneously, the US Attorney's Office for the Eastern District of New York unsealed criminal charges against Adani and Sagar Adani, Cyril Cabanes, and others linked to Adani Green and Azure Power.

The federal indictment unsealed in a federal court in Brooklyn charges five others with conspiracy to violate the Foreign Corrupt Practices Act in connection with the bribery scheme, involving one of the world's largest solar energy projects.