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Indian Tycoon Gautam Adani Charged in U.S. Over $265 Million Bribery Scheme

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Indian Tycoon, Gautam Adani, Bribery Scheme, financial

Business Honor
22 November, 2024

Shares in Adani Group tumble as U.S. prosecutors indict Gautam Adani and associates for alleged fraud.

Indian billionaire Gautam Adani has been indicted by U.S. prosecutors for his involvement in a $265 million bribery scheme, marking a significant crisis for his conglomerate, the Adani Group. The indictment, which includes multiple counts of fraud, alleges that Adani and seven other defendants paid bribes to Indian government officials to secure power supply contracts, with the goal of developing India’s largest solar power plant.

The charges also entail raising over $3 billion in loans and bonds while concealing corruption from investors, sending shockwaves throughout the financial world. U.S. authorities have issued arrest warrants for Adani and his nephew, Sagar Adani, who is a senior executive at Adani Green Energy, following charges related to a 2021 bond offering by Adani Green that included $175 million from U.S. investors.

Sharply now declining by the scandal, stock value in the Adani Group went down: shares of Adani Green Energy crashed down to 16%, and other companies in the group dropped by more than 10% of their values. The total market capitalization fell by $20 billion, which wears out a huge value compared to last year at its peak of $235 billion. Even their dollars-denominated bonds in the United States came under attack as prices fell 3 to 5%.

This is the second controversy in a year for Adani Group, which was earlier last year accused of offshore tax havens by short-seller Hindenburg Research. Although Adani Group has denied these charges, the present one has added more to their woes with many political opponents in India demanding a parliamentary probe into the group's practices.

Adani, one of the world’s richest individuals with an estimated net worth of $69.8 billion, is facing severe financial and reputational damage. The U.S. indictment has further heightened concerns about the business practices of his empire, with several key investors and firms now under scrutiny.