• The U.S. SEC has issued a summons to Gautam Adani and Sagar Adani over bribery allegations.
• The SEC seeks penalties and restrictions on the Adanis from serving as officers of listed companies.
• Federal prosecutors have issued arrest warrants for the Adanis, accusing them of a $265 million bribery scheme.
• The crisis has had significant financial impact, wiping billions off the market value of Adani Group companies.

In a recent development that has sent shockwaves through the global business community, the U.S. Securities and Exchange Commission (SEC) has issued a summons to Indian billionaire Gautam Adani, the head of the Adani Group, and his nephew Sagar Adani. The summons is in connection with U.S. bribery allegations that have been leveled against them, as revealed in a federal indictment.

The SEC's lawsuit alleges that the Adani duo engaged in bribery amounting to hundreds of millions of dollars to facilitate an Adani company. This was done while they were falsely promoting the company's adherence to anti-bribery principles and laws in relation to a $750 million bond offering. The summons, issued in the Eastern District of New York, requires a response within 21 days.

SEC Seeks Penalties and Restrictions

The SEC is seeking unspecified monetary penalties and restrictions on the Adanis from serving as officers of listed companies. The Adani Group, however, has not responded to the latest developments so far.

The group has previously denied the criminal charges, labeling them as baseless. The group's CFO has stated that the indictment is linked to a single contract of Adani Green Energy, which constitutes about 10% of its business. He further clarified that no other firms in the conglomerate were accused of any wrongdoing.

Arrest Warrants Issued

The allegations against the Adanis do not stop at the SEC lawsuit. Federal prosecutors have issued arrest warrants for Gautam and Sagar Adani, accusing them of participating in a $265 million scheme to bribe Indian officials to secure power-supply deals.

The authorities have stated that Adani, his nephew Sagar, and seven other defendants agreed to bribe Indian government officials to obtain contracts that were expected to yield $2 billion of profit over 20 years. These contracts were for the development of India's largest solar power plant project.

This crisis is the second major blow to the Adani Group in two years. The conglomerate, which has interests ranging from ports to power, was founded by Gautam Adani, who is one of the world's richest people.

The impact of the crisis was felt immediately in the financial markets, with billions of dollars being wiped off the market value of Adani Group companies. The crisis also had repercussions in Africa, with Kenya's president canceling a massive airport project with the group.

Historical Similar Events

This is not the first time that a major business figure has faced such allegations. In the past, similar charges have been leveled against other high-profile individuals.

For instance, in 2018, Malaysian financier Jho Low was indicted by the U.S. Department of Justice on charges of money laundering and bribery in connection with the 1MDB scandal. Like the Adani case, the charges against Low involved allegations of bribing government officials to secure lucrative contracts.