| Gautam Adani, India's second-richest man and the founder of a sprawling ports-to-power business group, is facing grave accusations of bribery and securities fraud in two separate cases brought by US authorities. It’s the first time an Indian business leader of this standing is facing such charges. Hours before the five-count criminal indictment was made public, Adani Green Energy tapped the US corporate bond market for a $600 million offering which it has since scrapped. It will likely be the last attempt to raise international funds for a while. While Adani will no doubt vigorously defend himself against these allegations of “criminal schemes,” his global ambitions will be dampened until a final legal outcome is reached. These include a $10 billion investment in US energy and infrastructure projects that he committed to in a post on X last week congratulating Donald Trump on his election win. Dollar bonds issued by the Adani Group tumbled on Thursday morning after the news, which also prompted a steep fall in shares of related companies. The indictment of Adani Group‘s chairman and other senior officials on bribery charges is credit negative for the group’s companies, according to a statement from Moody’s Ratings. Requests for comment from Bloomberg to a representative for Adani Group’s US offices weren’t immediately returned. Lawyers for Sagar Adani and Jaain didn’t immediately respond to requests for comment. None of the defendants have been taken into custody. The bribery charges come just as the Adani Group recovered from a crippling short-seller attack by Hindenburg Research last year, which erased over $150 billion in the group’s combined market value at one point. The charges will also have implications for the US-India relationship as Adani is seen to be close to Prime Minister Modi, though the two have consistently denied any political favors were granted. Relations were already somewhat tense between the two countries after US accusations against an Indian government employee of directing a foiled plot to assassinate a Sikh separatist with US citizenship in New York. It’s unclear yet how the incoming Trump administration will view these two very different matters given the president-elect's warm relationship with Modi, but also his dislike for Indian tariffs. In politics, everything is leverage.  Gautam Adani (left) with Narendra Modi, then Gujarat chief minister, at the Vibrant Gujarat Global Summit in 2011. Photographer: Mint/Hindustan Times Adani, his nephew Sagar and six other officials have been accused of a scheme to pay over $250 million in bribes to Indian government officials to obtain solar energy supply contracts, said the statement by the US Attorney's Office of the Eastern District of New York. The allegations put Gautam Adani at the center of the bribery scheme, after Adani Green Energy won a tender to supply 8 gigawatts of solar power to the government-owned Solar Energy Corporation of India. Officials of Azure Power, which won a similar 4 GW tender, and former executives of Canadian public pension fund manager CDPQ, an investor in Azure Power, have also been named in the case. SECI was unsuccessful in finding buyers for the power at the prices contracted with Adani and Azure. Hence Adani, along with others, allegedly met with various government officials several times in 2021 and 2022 and offered them bribes to sign power sale agreements with SECI, according to the US Attorney’s Office. Following the promise of bribes, electricity distribution companies in Odisha, Jammu and Kashmir, Tamil Nadu and Chhattisgarh also entered into agreements with SECI. The indictment alleges that $228 million was paid to an official of the Andhra Pradesh state government, after which the state agreed to purchase 7 GW of solar power from SECI. The US case document has detailed accounts of how Sagar Adani allegedly used his mobile phone to track details of the bribes offered, while Adani Green Energy CEO Vneet Jaain used his phone to take a photograph of a document summarizing Azure Power's share of the bribes paid, amounting to over $80 million. It also lists a meeting allegedly held by Gautam Adani to recover some of the bribe amounts from Azure Power officials and subsequently direct them to return some of the power purchase agreements to SECI, which were then to be reallocated to an Adani subsidiary. Gautam Adani, Sagar Adani and Vneet Jaain lied about the bribery scheme as they sought to raise capital from US and international investors, US Attorney Breon Peace said in the statement. Conviction under the charges of conspiracies to violate the US Foreign Corrupt Practices Act, commit securities and wire fraud could result in government forfeiture of any property or proceeds derived as a result of such offences, according to the document. Meanwhile, in a separate civil lawsuit, the US Securities and Exchange Commission also charged Gautam Adani, Sagar Adani and an Azure Power executive with “violating the antifraud provisions of the federal securities laws.” Gautam and Sagar Adani induced US investors to buy Adani Green bonds while misrepresenting to them that their company had a robust anti-bribery compliance program, and that the company’s senior management had not and would not pay or promise to pay bribes, the SEC said in its statement. The SEC complaint seeks permanent injunctions, civil penalties and officer and director bars. Like with all legal action, the Adanis must be presumed to be innocent until proven guilty. That’s how courts will view it — but investors, now twice bitten, may stay shy. Hanging in the balance are some of India's largest infrastructure assets. Follow Bloomberg's India WhatsApp channel for more exclusive content on Adani and the billionaires, businesses and markets of India. Sign up here. | 
