Probe uncovers alleged stock manipulation and family ties in Adani shares
A recent investigation by a network of investigative journalists has revealed alleged stock manipulation and family connections in the shares of Adani, a powerful Indian business group. According to the report by the Organized Crime and Corruption Reporting Project, close family associates of the Adani family have invested hundreds of millions of dollars in publicly traded Adani shares through opaque investment funds and offshore structures. These investment funds were used to obscure the involvement of alleged business partners of the Adani family, who are believed to have close ties to Prime Minister Narendra Modi.
The report highlighted two specific cases where investors with reported ties to the Adani family have invested in Adani stock holdings worth $430 million. The involvement of these mysterious investors raises questions about the legality of their investments. Nasser Ali Shaban Ahli from the United Arab Emirates and Chang Chung-Ling from Taiwan have been identified as the controversial owners of Adani stock. The investigation brings into focus the profitability of their investments and the allegations of stock manipulation.
This probe comes several months after US-based short-seller Hindenburg Research accused Gautam Adani, the leader of the Adani Group and one of the richest men in the world, of corporate fraud, improper business deals, and stock manipulation. Hindenburg’s report led to a loss of over $90 billion in the group’s valuation, although the Adani Group denied any wrongdoing.
Unlike Hindenburg, the new investigation reveals the identities of the alleged owners of Adani stock and raises questions about the legality of their investments. The Emerging India Focus Fund (EIFF) and EM Resurgent Fund, which are typical offshore investment vehicles, were used by these foreign investors to trade large amounts of Adani shares between 2013 and 2018. The investments resulted in significant profits for the insiders as they bought Adani stock low and sold it high.
The Adani Group has seen remarkable growth, with its market capitalization soaring from under $8 billion in September 2013 to $260 billion last year. The group has also secured numerous government contracts and agreements to operate and redevelop Indian airports. However, these recent allegations raise concerns about the transparency and legality of the group’s operations.
The Adani Group has vehemently denied the allegations, rejecting them as recycled allegations. A spokesperson for the group described the timing of these reports as suspicious and malicious, suggesting that they may be attempts to drive down the group’s stock prices for the profit of short sellers. The spokesperson also mentioned that the short sellers themselves are under investigation by various authorities.
As this investigation unfolds, it highlights the larger issue of transparency and accountability in India’s business landscape. The allegations against the Adani Group and the involvement of family associates in stock manipulation raise concerns about the integrity of the financial markets and the potential influence of powerful business groups.
It remains to be seen how these allegations will be addressed and whether further legal actions will be taken. As the Indian authorities examine the claims and gather more evidence, it is crucial for the public to stay informed and demand greater transparency and accountability from the country’s corporate entities. The outcome of this investigation could have far-reaching implications for both the Adani Group and the overall business environment in India.
