- Hundreds of millions of dollars were invested in group stocks through opaque investment funds by partners of promoter family, says
OCCRP . - All the nine
Adani group stocks opened in the red and continue to be under pressure. - The group rejected the ‘recycled allegations’ saying that SC and SEBI are overseeing these matters.
The project which calls itself a ‘global network of investigative journalists’ said that hundreds of millions of dollars were invested in publicly traded group stocks through Mauritius-based ‘opaque’ investment funds by partners of promoter family.
Adani Green Energy slipped the highest while three other stocks shed over 3% in today’s trade.
The investigation run by the Organized Crime and Corruption Reporting, details of which have been shared with the Financial Times, says that the Global Opportunities Fund based in Bermuda looks like any other fund, but on the inside two men were using the fund for a specific purpose – to amass shares of the Adani Group.
The two men named in the investigation are – Nasser Ali Shaban Ahli from the United Arab Emirates and Chang Chung-Ling from Taiwan - who are close associates of Vinod Adani, the elder brother of Gautam Adani. The FT article says: “Their investments were overseen by a Vinod Adani employee, raising questions over whether they were front men used to bypass rules for Indian companies that prevent share price manipulation. Their intricate paper trail that shielded them from regulators and the public has been laid bare in documents shared with the Financial Times by Organized Crime and Corruption Reporting, a network of investigative journalists.”
The new documents, based on which the articles have been written, identify Ahli and Chang as two most significant investors in the broader scheme outlined by
Both men began their investments in Adani stocks in 2013. FT goes on to say that were Sebi, the markets regulator in India, to treat Chang and Ahli as proxies for Vinod Adani then it would mean Adani Group breached the rules to prevent artificial inflation of share prices.
Group refutes ‘recycled allegations’
The Adani group released a statement saying that the OCCRP report was aimed to generate profits by driving down its stock prices.
“We categorically reject these recycled allegations. These news reports appear to be yet another concerted bid by Soros-funded interests supported by a section of the foreign media to revive the meritless Hindenburg report,” the group statement said.
The group said that these claims are based on closed cases from a decade ago when the Directorate of Revenue Intelligence (DRI) probed allegations of over invoicing, transfer of funds abroad, related party transactions and investments through FPIs.
“Notably, these FPIs are already part of the investigation by the Securities and Exchange Board of India (SEBI). As per the Expert Committee appointed by the Hon’ble Supreme Court, there is no evidence of any breach of the Minimum Public Shareholding (MPS) requirements or manipulation of stock prices,” the group said.
The case, based on a few public interest litigations (PILs) on stock manipulations is being heard in the Supreme Court. It has appointed a six-member expert committee and also asked the market regulator SEBI to submit a report on the same, which it did, on August 25. The hearing of the case has been postponed.
As the Hon’ble Supreme Court and SEBI are overseeing these matters, it is vital to respect the ongoing regulatory process, the group said.
This is the second set of allegations on the group, after US-based Hindenburg Research had alleged stock manipulation and accounting troubles on the group in January this year. Hindenburg also added that it has taken short positions on the group stocks.