India’s Adani Group has denied media reports suggesting it is being investigated by the US Department of Justice (DOJ) over bribery allegations. The company, founded by tycoon Gautam Adani, claims it has not received a notice from the DOJ and dismissed a Bloomberg report claiming an investigation is underway as “false,” according to an exchange filing on Monday.
Bloomberg, citing unnamed sources, claimed US prosecutors had widened their probe of the Adani Group to focus on whether the company may have engaged in bribery and was also looking into “the conduct of the company’s billionaire founder.” The report highlighted an Adani Group entity that was potentially involved in “paying officials in India for favorable treatment on an energy project.”
The report claimed US investigators were digging into whether an Adani entity was involved in paying officials in India for favorable treatment on an energy project. The probe was also said to be looking at Indian renewable energy company Azure Power Global Ltd, one of the largest companies in India’s renewable energy space, which was founded in the US by Indian-American entrepreneur Inderpreet Wadhwa in 2007. Azure was the first renewable energy company from India to list on the New York Stock Exchange (NYSE) in 2016.
According to Bloomberg, the case was being handled by the US Attorney’s Office for the Eastern District of New York and the Justice Department’s fraud unit in Washington. After the publication of the report, the shares of Adani Group-owned companies experienced significant declines, marking their largest drop in over a year. The shares remained in the red on Tuesday despite the denials of the US investigation. Weighing in on the matter, JPMorgan on Monday said that the “scope for significant corruption and bribery” is “highly unlikely” given the high level of transparency involved in renewable energy tenders floated in India.
The development comes months after Adani Group overcame what was labeled by Indian media as one of the biggest ever corporate takedowns by a short seller. Last year, US research firm Hindenburg alleged that the conglomerate had “engaged in a brazen stock manipulation and accounting fraud scheme.” This triggered a plunge in the value of the group’s companies of about $145 billion at the lowest point.
A few months later, the investigative journalism platform Organized Crime and Corruption Reporting Project accused the Adani family of “secretly investing hundreds of millions of dollars into the Indian stock market, [and] buying its own shares,” causing the company’s stocks to fall further.
The Adani Group, in a rebuttal to the OCCRP report, characterized the allegations as “rehashed” and “wholly baseless.”
In January, India’s Supreme Court refused to order a special probe into the Hindenburg allegations, turning down a batch of public interest litigations (PILs).
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