SEBI has found Adani offshore investors violated disclosure rules: Congress

On the heels of a Reuters report stating that the Securities and Exchange Board of India (SEBI) had found "a dozen offshore funds" invested in Adani Group companies in violation of disclosure rules and breach of investment limits, Congress MP and general-secretary (communications) Jairam Ramesh has issued a statement promising a joint parliamentary committee (JPC) probe should the Opposition INDIA bloc assume power in June following the ongoing Lok Sabha elections.

The Reuters report, published on Monday, claimed to have inputs from "two people with direct knowledge of the matter", who refused to be named since they are not authorised to speak to media. The report also claimed that SEBI and the Adani Group had not responded to emailed requests for comment at the time of filing the report.

In his statement, Ramesh said, "After years of prevarication and timidity, India’s stock market regulator SEBI, under pressure of a Supreme Court-enforced investigation, appears to have finally identified the key players of the Adani MegaScam.

"Far from the 'clean chit' that Modani and the Godi media claimed last year, a Reuters news report suggests that SEBI has found that 'a dozen offshore funds invested in Adani Group companies were in violation of disclosure rules and in breach of investment limits'. PM Modi’s strong and personal electoral bond with Adani cannot cover up his close friend ’s illegality any longer."

In the text accompanying an image of the statement which he posted on X, Ramesh wrote, "SEBI has now confirmed that a dozen offshore funds which invested in Adani Group companies “violated disclosure rules and breached investment limits”. This is the tip of the iceberg: when we launch a JPC inquiry after coming to power in June 2024, the full extent of the loot will become public," using the hashtag #AdaniMegaScam.

In August 2023, the international news agency had published a similar report stating that an investigation of the Adani Group by SEBI had uncovered violations of disclosure rules by listed entities and limits on the holdings of offshore funds. The report also stated that SEBI had "launched the inquiry after U.S.-based Hindenburg Research raised governance concerns around the Gautam Adani-led group, shaving more than $100 billion from the market value of its companies".

In his statement, Ramesh has named two Adani associates, Nasser Ali Shahban Ahli and Chang Chung-Ling, and claimed that SEBI was already investigating Ahli's shell company Gulf Asia Trade & Investment fund, incorporated in the British Virgin Islands, "for violating share ownership rules and for potentially acting in concert with the Adani Group to manipulate share values and to carry out money laundering and round tripping through offshore tax havens".

The Congress MP has also mentioned the Organised Crime and Corruption Reporting Project (OCCRP) — a global network of investigative journalists with a presence in six continents — which he said previously revealed that Chang and Ahli "used benami funds to amass large stakes in the Adani Group between 2013 and 2018", and that Rs 20,000 crore in benami funds had flowed into Adani Group companies as a result of their transactions.

Ramesh has also demanded immediate publication of SEBI’s "long-delayed report" on "these gross violations of Indian securities laws in the Adani MegaScam", and pointed to other "important aspects of the MegaScam" such as:

1. The miraculous doubling, on the high seas, of the price of coal being imported by Adani from Indonesia for power plants in India, which cost was passed on to Indian consumers

2. "Misuse" of agencies like the Enforcement Directorate, Central Bureau of Investigation, and the income tax department to force firms to divest assets in critical infrastructure sectors to "help the PM’s close friend(s) amass assets and monopolies"

3. Using India's diplomatic resources to funnel contracts to Adani in Bangladesh, Sri Lanka and other countries

The Congress MP has ended the statement with the opinion that "only a JPC can investigate the full extent of the Adani MegaScam. This will happen in June 2024, as soon as the INDIA coalition takes office".