Recent attempts by top Indian lawyers to downplay the US indictment of Gautam Adani by focusing solely on the FCPA (Foreign Corrupt Practices Act) charges are surprising and do not reflect a careful understanding of US federal criminal law. While it’s true that Adani isn’t charged with FCPA violations, the charges he does face are very serious and carry longer prison terms.
Let’s be clear about what Adani is charged with: securities fraud conspiracy, wire fraud conspiracy, and securities fraud related to bond offerings. These are among the most serious white-collar crimes in the US criminal justice system:
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Count Two – Securities fraud conspiracy (18 United States Code – 371) maximum punishment: 5 years;
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Count Three – Wire fraud conspiracy (18 USC – 1349) maximum punishment: 20 years; and
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Count Four – Securities fraud (15 USC – 78j(b) and 78ff) maximum punishment: 20 years
The securities fraud charges allege that Adani deliberately deceived US investors and financial institutions by making false statements about his company’s anti-corruption practices while actively engaging in a massive bribery scheme in India. This isn’t just about paperwork violations—it’s about allegedly defrauding American investors and financial institutions of billions of dollars.
The indictment details how Adani allegedly continued to access US capital markets even after learning he was under federal investigation. In March 2023, when FBI agents served a search warrant on his nephew, Adani emailed himself photos of the warrant. Yet, his companies proceeded to raise $1.36 billion through a syndicated loan in December 2023 and issued $409 million in bonds to US investors in March 2024, all while allegedly making false statements about anti-corruption compliance.
This behaviour is particularly significant under US law. Continuing to commit alleged fraudulent acts after becoming aware of a federal investigation demonstrates what prosecutors call “consciousness of guilt” and can lead to enhanced penalties under US sentencing guidelines.
The wire fraud conspiracy charge is equally serious. It alleges that Adani used the US communications infrastructure to execute his scheme to defraud. Under US law, each wire transmission in furtherance of fraud can be charged as a separate offence, though prosecutors here have grouped them into a single conspiracy count.
Moreover, the indictment seeks forfeiture of all proceeds traced to the alleged crimes. This means that if convicted, Adani could face not only imprisonment but also the loss of billions in assets connected to the fraudulent schemes.
The consequences extend beyond criminal penalties. A conviction could result in debarment from the US markets and financial institutions. Given the global reach of the US financial systems, this could severely impact the Adani Group’s international operations and ability to raise capital worldwide.
Those attempting to minimise these charges by focusing on the FCPA miss a crucial point: the US prosecutors often strategically choose charges based on the strength of evidence and likelihood of conviction. Securities and wire fraud charges can be easier to prove than FCPA violations because they focus on the deception of investors rather than the complexities of foreign bribery schemes.
Furthermore, the indictment’s detailed allegations about bribery in India aren’t less serious just because Adani isn’t charged with FCPA violations. These allegations form the basis of the fraud charges—Adani is accused of lying to investors about these very activities to obtain their money.
The US Department of Justice has a remarkably high conviction rate in such cases, often exceeding 90%. The level of detail in this indictment – including specific dates, amounts, and communications – suggests prosecutors have built a strong case.
It’s worth noting that similar charges have resulted in significant prison sentences for other business leaders. Those dismissing these charges as merely technical violations misunderstand their gravity under US law. The American justice system takes fraud against its financial markets extremely seriously, viewing it as a threat to the integrity of the financial system. Most recently, the Economist wondered “Why the American stock markets reigned supreme” and concluded that “America’s high valuations make it an attractive place for firms to raise capital. And America dominates private markets as well as public ones.”
The attempt to minimise these charges by focusing on the absence of FCPA could mislead the Indian public about the seriousness of Adani’s legal situation. The truth is that Adani faces some of the most serious charges available under the US federal securities law, backed by what appears to be substantial evidence gathered through a lengthy investigation.
KV Dhananjay is an advocate in the Supreme Court of India. Views are personal.
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