Experts question US targeting of Indian tycoon – media

The US Securities and Exchange Commission (SEC) has issued a summons to Gautam Adani, India’s second richest man and head of a large industrial conglomerate, as part of an investigation into allegations of bribing Indian officials to secure lucrative contracts. The summons requires an answer within 21 days, Reuters reported on Sunday citing a New York court filing. The SEC is seeking unspecified monetary penalties and restrictions on Adani and his nephew from serving as officers of listed companies, the report said.

The drama escalated last week after US prosecutors indicted Adani and six other people linked to the conglomerate, including his nephew Sagar Adani, over an alleged $265 million scheme to pay Indian officials to secure power deals for Adani Group’s renewable energy projects in India. 

The case follows US short-seller Hindenburg Research’s claims that the Adani Group manipulated stock prices and perpetrated accounting fraud. The accusations against the conglomerate brought down its stock value by nearly $150 billion last year. 

Adani Group has denied the US charges, terming them “baseless” and promising “all possible legal recourse.”

Meanwhile, legal experts and analysts have raised concerns about applying US laws to an Indian company in its home country. “While our domestic laws remain the same, a preliminary issue arises about extraterritoriality application of US laws,” prominent India-American attorney Ravi Batra told PTI news agency on Monday. Batra cited US Chief Justice John Roberts, who previously described extraterritoriality as “generally disfavored” in international relations, with a presumption against it in both criminal and civil jurisprudence.

Former Indian Foreign Secretary and RT contributor Kanwal Sibal weighed in on the US bribery charges against Adani in a post on X, questioning the “extraterritorial application” of US laws. “Simply because some money was raised in the US by a company and that company allegedly paid bribes in India it cannot be argued that the principal cause of action lies in the US. Have US investors lost financially or morally?” he asked. 

Sibal argued that action should only be taken if the charges are proved after an investigation, and that then the case should be transferred to India with all the evidence. “It would then be for the Indian administrative and judicial processes to take appropriate action,” he said. 

Adani Group’s stock suffered a loss of around $26 billion last week following the charges by the US Department of Justice (DOJ). Apart from Guatam and Sagar Adani, several other board members of various group companies were named.

The group’s CFO Jugeshinder Singh said in a post on X that the fraud allegations relate to one contract involving Adani Green Energy, which is about 10% of the company’s overall business. He emphasized that none of the group’s 11 companies or their subsidiaries listed on stock exchanges are defendants in the US Department of Justice case and are not accused of any wrongdoing.