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Cong, CPI(M) Attack Govt Over Fresh Allegations Against Adani Group, Question SEBI

The OCCRP, Financial Times and The Guardian reports alleged hundreds of millions of dollars were invested in publicly traded group stocks through 'opaque' investment funds.

Congress leaders Jairam Ramesh and Pawan Khera during a press conference, in Mumbai, Thursday, Aug. 31, 2023 / Image Courtesy: PTI

Mumbai/New Delhi: The Congress and the CPI(M) on Thursday targeted the Narendra Modi government over fresh allegations against the Adani Group by the Organised Crime and Corruption Reporting Project (OCCRP), and claimed that "corruption" in shell companies linked to the conglomerate was getting stronger.

While the Congress said that only a JPC can uncover the truth, the CPI(M) called for a serious probe into the fresh allegations and urged the Supreme Court to ensure that there is no cover-up.

Congress general secretary Jairam Ramesh questioned the role of market regulator SEBI in properly investigating the role of shell companies linked to the Adani Group. 

"Despite the Modi government's best efforts, the truth will not stay suppressed forever. However, the full story about the flow of benami funds into the Adani Group, how foreign citizens came to play a role in critical national infrastructure and how PM (Narendra) Modi 'violated rules, regulations and norms to enrich his close friends' can only be revealed by a JPC," he alleged at a press conference at the Maharashtra Pradesh Congress office here.

The Organised Crime and Corruption Reporting Project (OCCRP), and investigative reports in The Guardian and Financial Times, on Thursday trained guns on the Adani Group, alleging hundreds of millions of dollars were invested in publicly traded group stocks through Mauritius-based 'opaque' investment funds managed by partners of promoter family, charges the conglomerate denied vehemently.

Ramesh said "questions remain about SEBI's role. Did the obvious conflict of interest revealed by the association of past SEBI chairpersons with the Adani Group play a role in SEBI's inability to properly investigate these shell companies".

“The Financial Times and The Guardian have, based on inputs from the Organised Crime and Corruption Reporting Project, revealed how two close associates of Vinod Adani used an investment fund in Bermuda and set-up shell companies to buy millions of dollars of shares in the Adani companies,” said the CPI(M) in a statement.

The fresh allegations by OCCRP come months after a US short seller’s report 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. The Adani Group has denied all Hindenburg allegations.

In a post on X, Ramesh said that as New Delhi gears up for the 2023 G20 summit meeting, it is worth recalling Prime Minister Modi's words at the November 2014 Brisbane G20 summit calling for global cooperation “to eliminate safe havens for economic offenders”, to “track down and unconditionally extradite money launderers” and to “break down the web of complex international regulations and excessive banking secrecy that hide the corrupt and their deeds.”

"Today's explosive revelations by The Organized Crime and Corruption Reporting Project, The Financial Times and The Guardian about the clearly brazen violations of Indian securities laws by the Adani Group and its close associates are a reminder of how hollow these words have proven," Ramesh said.

"They are a reminder of the lengths and depths to which the PM has gone to 'protect his corrupt friends and their misdeeds' by rendering India's regulatory and investigative agencies toothless, reducing them to political tools to intimidate the Opposition rather than to investigate wrongdoing," he alleged.

Ramesh said the revelations also provide some answers to the more than 100 pointed questions the Congress party has asked the PM about his "murky relationship" with Adani as part of the Hum Adani Ke Hain Kaun (HAHK) series, the Congress general secretary said. 

The PM continues to be silent on these questions of national interest, he claimed.

Ramesh said there is now fresh evidence linking Adani associates Nasser Ali Shaban Ahli and Chang Chung-Ling to an effort to bypass Indian securities laws relating to minimum public shareholding that were put in place to prevent share price manipulation. 

"Shell companies controlled by Ali and Chang—that have been revealed to be fronts for Gautam Adani's elder brother Vinod—accumulated substantial stakes in four Adani Group companies covertly and illegally," he alleged.

"The stench of corruption around the network of Adani-linked shell companies located in opaque tax havens is only getting stronger with the money trail being established now," Ramesh claimed.

He said the actual ownership of two of the 13 benami shell companies that SEBI has failed to identify, despite years of “investigation”, has been revealed. 

"Why did SEBI fail to disclose to the Supreme Court that the Directorate of Revenue Intelligence(DRI) had carried out investigations against the Adani Group in 2014, that were then closed by the Modi government in 2017, Ramesh asked.

Ramesh also said that Rahul Gandhi will address a press conference on the matter on Thursday evening.

Adani, in a statement, categorically rejected what it called as "recycled allegations", calling them "yet another concerted bid by Soros-funded interests supported by a section of the foreign media to revive the meritless Hindenburg report".

SC Must Ensure no Cover-up: CPI(M)

In a statement, the polit bureau of the Communist Party of India (Marxist), said the OCCRP, FT and The Guardian reports also show that the SEBI was looking into the matter of offshore funding of Adani companies in 2014 but had closed the enquiries subsequently.

“Adani’s links with Prime Minister Modi has so far ensured that the regulatory authorities do not take any action against the widespread fraud and manipulation of the stock market.

The fresh evidence necessitates a serious probe and the Supreme Court has to step-in to ensure that there is no cover-up,” the statement read.

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