Hundreds of millions of dollars were invested in publicly traded Adani group stocks through Mauritius-based "opaque" investment funds by partners of promoter family, the Organised Crime and Corruption Reporting Project (OCCRP) alleged on Thursday.
The fresh allegations by an organisation funded by likes of George Soros and Rockefeller Brothers Fund come months after a U.S. short seller wiped away close to $150 billion in value of Adani group stocks with allegations of accounting fraud, stock price manipulation and improper use of tax havens by the ports-to-energy conglomerate run by billionaire Gautam Adani. Adani group has denied all allegations.
Citing review of files from multiple tax havens and internal Adani Group emails, OCCRP said its investigation found at least two cases where the "mysterious" investors bought and sold Adani stock through such offshore structures.
The two men, Nasser Ali Shaban Ahli and Chang Chung-Ling, who OCCRO claimed have longtime business ties to the Adani family and have also served as directors and shareholders in group companies and firms associated with Gautam Adani's elder brother, Vinod Adani, "spent years buying and selling Adani stock through offshore structures that obscured their involvement - and made considerable profits in the process." The documents "show that the management company in charge of their investments paid a Vinod Adani company to advise them in their investment," it alleged.
While Adani group did not immediately comment on the fresh allegations, to OCCRP it stated that the Mauritius funds in question had already been named in the U.S. short seller Hindenburg report and the "allegations are not only baseless and unsubstantiated but are rehashed from Hindenburg's allegations."
"It is categorically stated that all the Adani Group's publicly listed entities are in compliance with all applicable laws including the regulation relating to public share holdings,” it told the OCCRP.
PTI had on August 24 reported that the Soros-funded organisation, which calls itself "an investigative reporting platform formed by 24 nonprofit investigative centres...spread across Europe, Africa, Asia and Latin America", is planning publication of fresh allegations against a top Indian corporate.
OCCRP asked if Ahli and Chang should be considered to be acting on behalf of Adani promoters. "If so, their stake in the Adani Group would mean that insiders altogether owned more than the 75% allowed by law," it said, adding this violated Indian listing law.
It went on to state that there was no evidence Chang and Ahli's money for their investments coming from the Adani family, but said its investigation showed there "is evidence" that their trading in Adani stock "was coordinated with the family."
"The Adani Group's rise has been staggering, growing from under $8 billion in market capitalization in September 2013 - the year before Narendra Modi became prime minister - to $260 billion last year," it said.
The conglomerate is active in a dizzying array of fields, including transportation and logistics, natural gas distribution, coal trade and production, power generation and transmission, road construction, data centres, and real estate.