Billionaire Gautam Adani and several others, accused by US authorities of paying $250 million in bribes to secure solar energy contracts, could seek to resolve the charges through settlements while pursuing appeals.
The allegations center around misleading US investors and institutions to secure billions in funding, triggering a five-count criminal indictment under the Foreign Corrupt Practices Act (FCPA). The blow wiped $12 billion off the tycoon’s net worth, slashing it by 17% to $57.7 billion, according to Forbes, while the Adani Group’s market capitalization plummeted by ₹2.24 lakh crore.
What does US law say?
US laws permit settlements in bribery cases through Deferred Prosecution Agreements (DPAs) or Non-Prosecution Agreements (NPAs). According to Narinder Wadhwa, Managing Director, SKI Capital, such agreements often involve paying fines, admitting partial wrongdoing, and strengthening compliance measures. Precedents like Siemens ($800 million) and Ericsson ($1 billion) suggest the Adani Group might consider this route to cap reputational and financial damage.
Settlements typically come with heavy monetary penalties, mandatory compliance monitoring, and restricted access to US and European capital markets. While judges have the discretion to decide penalties, previous FCPA violations, like Goldman Sachs’ $2.9 billion fine, highlight the severity of potential outcomes.
For the Adani Group, a settlement could help stabilize investor sentiment but would not erase reputational and financial costs. Future international capital-raising efforts, especially through foreign-currency bonds, could face challenges. “Future capital-raising efforts, especially internationally, could remain challenging,” Wadhwa noted.
The Adani Group has denied the allegations, stating, “We are a law-abiding organization, fully compliant with all laws.” A spokesperson emphasized that the indictment is based on allegations, and the defendants are presumed innocent until proven guilty. The group has committed to exploring all legal options to defend itself.
While Adani’s defensive stance suggests an attempt to assess the strength of the evidence, settlement discussions could emerge if the charges prove substantial. The trial process, likely through a grand jury, will determine whether the group pursues appeals or negotiates an agreement to close this chapter.