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Adani Group Embroiled in Legal Issues

The Adani Group, a prominent Indian conglomerate, is currently facing legal issues in the United States. The group's chairman, Gautam Adani, and other executives have been accused of bribery and fraud by US authorities.

US Bribery Probe

The US Department of Justice has issued an indictment against Sagar Adani, Gautam Adani, and others, alleging they violated the US Foreign Corrupt Practices Act (FCPA) by bribing certain Indian officials. The Adani Group disclosed the existence of an anti-bribery probe in the United States nearly a year after the Federal Bureau of Investigation (FBI) raided the premises of Sagar Adani.

Charges and Penalties

Gautam Adani and several others have been accused of bribery charges by US authorities in connection with solar energy contracts in India. The US Department of Justice has charged Gautam Adani, his nephew Sagar Adani, and Vneet Jain with conspiracies to commit securities and wire fraud and substantive securities fraud. The amount paid in bribes to Indian government officials to get solar energy contracts is allegedly over $250 million.

Settlement Options

The Adani Group can resolve the issue by paying fines, admitting certain wrongdoing, and improving compliance practices. Settlement typically involves substantial monetary penalties, enhanced compliance measures, and independent monitoring and limited future restrictions, such as reduced access to US funding.

Impact on Adani Group

The most significant impact on the Adani Group would be its inability to approach overseas markets for funding, as it has preferred foreign currency-denominated bond routes so far. Future capital-raising efforts, especially internationally, could remain challenging.

Adani Group's Response

The Adani Group has termed the allegations by US Department of Justice and the US Securities and Exchange Commission as baseless and denied them. It said all possible legal recourse will be sought. The group emphasized that the charges are merely allegations and that the defendants are presumed innocent unless and until proven guilty.

Market Impact

Shares of several Adani Group companies, including its flagship Adani Enterprises, suffered steep losses, hitting their lower circuits in early trading. The sell-off was triggered by the revelation of a criminal indictment in New York against Gautam Adani, accusing him of involvement in a multibillion-dollar bribery and fraud scheme. Adani Group's 10 listed stocks had