Count 1 of the Department of Justice (DOJ) chargesheet against Gautam Adani and others begins with the statement:
“The allegations contained in paragraphs 1 through 123 are realleged and incorporated as if fully set forth in this paragraph.”
Paragraph 20 of the chargesheet explicitly states:
“Starting in 2020, Defendant Ranjit Gupta and Co-Conspirator #2, acting within their roles as officers of the U.S. Issuer, knowingly conspired with others, including but not limited to Gautam S. Adani, Sagar R. Adani, and Vneet S. Jain, to offer and authorize bribes to Indian government officials.”
The aim of this conspiracy was to secure contracts with state electricity distribution companies for the Indian Energy Company and its subsidiaries.
Additionally, the chargesheet names other alleged participants, including Cyril Cabanes, Saurabh Agarwal, Deepak Malhotra, and Rupesh Agarwal, detailing their involvement in the conspiracy during 2021–2022.
Given this context, it is premature to claim that Gautam Adani and his nephew, Sagar Adani, are not implicated in the charges under Count 1, as these allegations are directly tied to their roles in the overarching conspiracy.
Clarifications vs. Concerns
On Wednesday, prominent lawyer Mahesh Jethmalani clarified that neither Gautam Adani nor Sagar Adani is directly accused of bribery or obstruction of justice under Counts 1 and 5 in the charges filed by the DOJ.
These clarifications led to a strong recovery in Adani Group’s shares, which surged by up to 17%. Jethmalani emphasized the following:
- Count 1: Alleges conspiracy to violate the U.S. Foreign Corrupt Practices Act (FCPA). Gautam and Sagar Adani are not directly named, as this count targets other individuals, including officers and a foreign national.
- Count 5: Pertains to obstruction of justice, in which neither Gautam Adani, Sagar Adani, nor their officers are implicated.
However, despite these reassurances, significant concerns remain. The chargesheet’s “Overview and Background” section implicates Gautam and Sagar Adani as co-conspirators, as stated in Paragraph 20. This connection, reiterated in Count 1, raises serious legal challenges for the Adanis.
The implications of Counts 2, 3, and 4 further add to the gravity of the allegations, underscoring the need for careful scrutiny of the charges.
Adani Group’s Legal Woes: Legal Clarifications by Mahesh Jethmalani:
Gautam Adani and Sagar Adani are not directly accused of bribery or obstruction of justice under Counts 1 and 5 in the DOJ charges filed in Brooklyn.
Count 1 alleges conspiracy to violate the U.S. Foreign Corrupt Practices Act (FCPA), but neither Gautam Adani nor Sagar Adani is named.
Count 5, related to obstruction of justice, also does not implicate the Adanis or their officers.
Challenges Persist Despite No Direct Implication in Count 1.
Clause 20 of the Chargesheet in the “Overview and Background” section mentions Gautam Adani and Sagar Adani as co-conspirators.
These allegations are incorporated into Count 1 through its opening clause:
“The allegations contained in paragraphs 1 through 123 are realleged and incorporated as if fully set forth in this paragraph.”
This linkage ties allegations against the Adanis in the overview to the foundation of Count 1, undermining the notion of exoneration
Â
Even if Count one is taken out , Gautam Adani and his nephew, Sagar Adani, face so many direct charges under Counts 2, 3 and 4 that the Wednesday  bounces back in their share prices could only be described ‘ dead cat’ bounce.
 Below are the details of the charges under these counts faced by Adani and his groups and officials.
—————————————————————————–
Count-2 Securities Fraud Conspiracy
Â
Count 2 alleges that between 2021 and the present, Gautam Adani, Sagar Adani, Vneet S. Jain, and others knowingly conspired to manipulate and deceive investors in connection with bonds issued in 2021 and 2024. This includes:
Employing fraudulent schemes.
Making false or misleading statements.
Omitting material facts to mislead investors.
Key overt acts in this conspiracy include:
August 26, 2021: Sagar Adani and Vneet Jain authorized a $750 million securities issuance through a Management Committee resolution.
August 2021: Sagar Adani participated in a recorded roadshow presentation for U.S.-based investors.
November 2021: Gautam Adani, Sagar Adani, and Vneet Jain approved the use of bond proceeds through a formal resolution.
December 27, 2022: Vneet Jain signed a Compliance Certificate related to the bond issuance.
Â
Counts 3 and 4: Wire Fraud and Securities Fraud
Count 3 alleges a wire fraud conspiracy targeting lenders and investors, involving false representations regarding financial transactions, including the 2021 and 2023 Syndicate Loans and 144A Bonds.
Count 4 focuses on securities fraud linked specifically to the 2021 144A Bond, accusing the defendants of using deceptive practices to defraud investors through misleading statements and omissions.
Both counts incorporate the detailed allegations outlined in the initial 123 paragraphs of the chargesheet.
Although the defense argues that Gautam and Sagar Adani are not named in some counts, the allegations in Counts 2, 3, and 4 directly implicate them in serious financial crimes. The chargesheets portray a network of conspiracies involving bribes, fraud, and deception to secure business advantages and manipulate investments.
Beyond the Headlines: The Reality of Wire and Securities Fraud in the USA:
Security Fraud: Security fraud, also known as securities fraud, is a type of white-collar crime that involves the fraudulent activity in the buying or selling of securities. This can include a variety of actions, such as:
Misrepresentation: Providing false or misleading information about a company or its securities.
Insider Trading: Trading securities based on non-public, material information.
Market Manipulation: Artificially influencing the price of a security through fraudulent means.
Pump and Dump: Promoting a stock to artificially inflate its price, then selling it at a higher price.
 Penalties for securities fraud :
Penalties for securities fraud can be even more severe than those for wire fraud, as they often involve large-scale financial losses. Penalties can include:
Imprisonment: Up to 25 years or more
Fines: Substantial monetary penalties
Restitution: Repaying victims for their losses
Forfeiture: Losing assets gained through illegal activity
Both wire fraud and securities fraud are complex crimes with significant legal implications. If you believe you have been a victim of either crime, it is crucial to consult with a legal professional to understand your rights and options.
Wire Fraud
Wire fraud is a federal crime that involves using electronic communications, such as email, phone calls, or the internet, to defraud someone of money or property. It can include a variety of schemes, including:
Phishing Scams: Sending fraudulent emails or messages to trick people into revealing personal information.
Business Email Compromise (BEC): Hacking into email accounts to trick individuals or businesses into transferring money.
Investment Scams: Promising high returns on investments that don’t exist.
Penalties for Wire Fraud:
Imprisonment: Up to 20 years
Fines: Substantial monetary penalties
Restitution: Repaying victims for their losses
Forfeiture: Losing assets gained through illegal activity
