Mumbai | Washington: The US Department of Justice said it abandoned the criminal charges against Indian billionaire Gautam Adani and seven others because of ‘legal and pragmatic’ reasons, including a possible diplomatic strife and that there were no losses, or evidence to continue with the case.
In a 10-page filing, the DoJ said, “given that there were no victims who suffered any losses, the resolution of (a) civil case made it even more obvious that there was no point in pursuing criminal securities charges for the same conduct. Even if the criminal case were to continue, no victim would stand to recover any restitution, because there were no losses to recover.’’
The filing came after US District Judge Nicholas Garaufis asked the department to explain why it was seeking to permanently dismiss the indictment, calling its earlier motion “terse, bland, and conclusory.”
DoJ had in 2024 under the Biden administration indicted Adani and others for allegedly being involved in a scheme to bribe Indian government officials to the tune of $250 million and to lie to investors to receive billions more in investments from other entities — during which Adani Green Energy Ltd allegedly raised at least $175 million from US investors. The charges led to erosion in the market value of the group companies and the funding for many of its projects dried up. But the group has since come back, especially after May when the DoJ moved to drop charges.
Also Read: LME approves Adani's major copper smelter in India as listed brand
The group holding company Adani Enterprises Ltd this week raised as much as ₹15,000 crore in share sale and inked a deal to build an aluminium plant for $11.5 billion.
“The indictment was unsealed in the final days of the prior Administration, apparently as a ‘name and shame’ designed to levy accusations without any realistic prospect of a trial ever occurring,’’ the DoJ said. “Department leadership at the time was surely aware they were dropping a potential quagmire of a case into the lap of the incoming Administration, and perhaps that was an intentional choice.”
Asia’s richest man Gautam Adani was embroiled in controversy when the DoJ in November 2024 indicted him, his nephew Sagar Adani and six others for allegedly colluding in a corruption scheme worth thousands of crores of rupees, defrauding US investors and obstructing investigations. The indictment was brought by a district court of New York and the Securities and Exchange Commission in a combination of criminal and civil charges. The US prosecutors levelled five counts of charges against the Adani Group that had raised funds from US investors, and the New York Stock Exchange-listed Azure Power. The Adanis were charged with securities and wire fraud. But in May this year, the DoJ took a U-turn seeking to drop those charges.
The defendants in the proceedings were Adani Group chairman Gautam Adani, Sagar Adani, Vneet Jaain, Ranjit Gupta, Cyril Cabanes, Saurabh Agarwal, Deepak Malhotra and Rupesh Agarwal.
The decision to drop the proceedings as Gautam Adani and his nephew Sagar Adani agreed to pay a total $18 million to settle Securities and Exchange Commission allegations that they made false and misleading representations related to Adani Green Energy Ltd.
The DoJ said requiring prosecutors to publicly justify decisions to drop cases would discourage future dismissals, expose privileged internal deliberations and infringe on the executive branch’s constitutional authority over charging decisions.
The filing also argued the criminal securities fraud charges against Gautam Adani, Sagar Adani, and Cyril Cabanes lacked a sound legal basis because the alleged misconduct occurred almost entirely outside the United States and the securities transactions did not satisfy US jurisdictional requirements.
Waiving privilege only for this case, principal associate deputy attorney general R Trent McCotter said he decided to dismiss the charges after months of meetings with defence lawyers, reviewing hundreds of pages of submissions and conducting his own legal analysis. “The decision to seek dismissal was not a close call,” he wrote. The department cited six overarching reasons for dropping all charges, including that the alleged conduct was overwhelmingly centred in India, Indian authorities had investigated the allegations and found no actionable misconduct, investors suffered no financial losses, key evidence and witnesses were located abroad, the defendants were unlikely to ever appear before a US court, and the prosecution faced significant evidentiary hurdles.
(With PTI inputs)
