The Organised Crime and Corruption Reporting Project (OCCRP) recently made allegations against the Adani group, suggesting that they invested substantial amounts in publicly traded stocks through ‘opaque’ investment funds based in Mauritius. These funds were reportedly managed by partners linked to the promoter family. However, the Adani group vehemently denied these charges.
These new claims emerged after a previous incident where a US short seller negatively impacted Adani group stocks by approximately USD 150 billion through allegations of accounting fraud, stock manipulation, and improper use of tax havens. The short seller’s allegations were countered by Adani Group, which rejected all claims made by Hindenburg Research.
OCCRP’s investigation reportedly involved reviewing files from various tax havens and internal Adani Group emails. They found instances where individuals with connections to the Adani family, namely Nasser Ali Shaban Ahli and Chang Chung-Ling, allegedly engaged in offshore transactions involving Adani stock. These individuals were said to have made substantial profits through such trading activities.
According to OCCRP, documents indicated that the management company overseeing their investments paid a Vinod Adani company for investment advice. Adani Group responded by dismissing these allegations as “recycled” and suggested they were part of an attempt to revive the earlier Hindenburg report.
Adani Group clarified that these allegations were based on closed cases from a decade ago, involving investigations into over-invoicing, transfer of funds abroad, related party transactions, and investments through Foreign Portfolio Investors (FPIs). An independent adjudicating authority and an appellate tribunal reportedly confirmed the compliance of these transactions with applicable law.
The matter reached its conclusion in March 2023 when the Supreme Court of India ruled in favor of Adani Group, affirming that there was no over-valuation. Adani Group criticized the timing of these allegations and expressed confidence in the ongoing regulatory process overseen by the Supreme Court and the Securities and Exchange Board of India (SEBI).
The OCCRP report also mentioned that the foreign portfolio investors named were already part of SEBI’s investigation. Adani Group stressed that the allegations were aimed at driving down stock prices to generate profits for short sellers, who are under investigation by various authorities. The group reaffirmed its faith in due process and corporate governance standards.
OCCRP questioned whether Ahli and Chang acted on behalf of Adani promoters and raised concerns that their stakes, if linked to the Adani family, could exceed the legal limit of 75% ownership as per Indian listing law. While there was no evidence directly linking their investments to the Adani family’s funds, OCCRP suggested that their trading activities were coordinated with the family.
The Adani Group’s exponential growth over the years was highlighted, growing from under USD 8 billion in market capitalization in 2013 to USD 260 billion recently. The conglomerate’s diverse business operations in transportation, logistics, natural gas distribution, coal trade and production, power generation, road construction, data centers, and real estate were also noted.
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