In March, Adani Group's head of corporate finance wrote an email to one of its lenders, calling as "baseless" a media report on the group's alleged bribery investigation in the United States. That email was also marked to top finance executive Sagar Adani.
That same very week of March 11, the Adani Group had also issued a statement saying it was "not aware of any (U.S) investigation" against its 62-year-old billionaire chairman, Gautam Adani.
But exactly a year ago, in March 2023, FBI special agents had approached Sagar Adani with a search warrant in the United States, served him a grand jury subpoena and seized his electronic devices. Gautam Adani then emailed himself photographs of each page of that search warrant and subpoena.
These details, contained in a U.S. indictment made public this week, have reignited a debate about disclosure standards at the $143 billion ports-to-energy conglomerate as prosecutors allege the Adanis made "false" and "misleading" statements to stock exchanges, the public, financial institutions and investors.
Sagar Adani, his uncle Gautam, one of the world's richest men, and six others were indicted for fraud by U.S. prosecutors over their alleged roles in a $265 million scheme to bribe Indian officials to secure power supply deals, while, at the same time, falsely touting the company's compliance with anti-bribery laws when raising money from U.S. investors.
Hit by Hindenburg Research's scathing 2023 report about improper business management and use of tax havens - which Adani denied - the conglomerate since last year repeatedly said its corporate governance standards are impeccable, saying it remains "confident of our governance and disclosure standards".
The U.S. indictment shows prosecutors have found evidence to the contrary.
Gautam Adani and Sagar Adani "not only concealed the bribery scheme from financial institutions and investors in the United States and elsewhere but also caused others to make false and misleading statements regarding their awareness and knowledge," the indictment document says.
The Adani Group has said all allegations are "baseless and denied". It did not respond to a Reuters request for comment.
India's market regulator is making preliminary checks to see if disclosures were inadequate and if they breached local market regulations, a SEBI official told Reuters. SEBI did not respond to a request for comment.
"SEBI should issue a show cause notice to the Adani Group companies on the inadequate disclosures," said Shriram Subramanian, founder of proxy advisory firm InGovern Research Services.
'FALSE' DISCLOSURES
Corporate governance at the group has been a talking point since Hindenburg alleged in 2023 that Adanis engaged in "an open and repeated violation of Indian disclosure laws".
Adani responded to Hindenburg by saying its companies have "adopted best-in-class global disclosures and standards".
The documents made public by U.S. authorities said each year between 2021 to 2024, group firm Adani Green (ADNA.NS) publicly released annual reports which included "false and misleading statements" about its anti-bribery practices.
"The Adani Group can argue about the materiality of the investigations, but as the U.S. indictment reports note, the disclosures in the annual reports were against the established norms of good corporate governance," InGovern's Subramanian added.
The Adanis also "made or caused others" to make false statements relating to the U.S. government's investigation in public statements to media, markets and Indian stock exchanges, U.S. authorities allege.
In March 2024, Adani Green issued a disclosure to stock exchanges in India which U.S. prosecutors said "falsely stated, among other things, that ... (it) has not received any notice from the Department of Justice".
India's BSE and NSE stock exchanges did not respond to Reuters queries, nor did the Ministry of Corporate Affairs which also oversees financial disclosures.
