-US Taxpayers Fund Adani's West Terminal in Colombo Port Amidst Hindenburg Research's Damning Report
(Lanka-e-News -01.Jan.2024, 11.00 PM) In a startling turn of events, the Adani Group, a conglomerate with a net worth of INR 17.8 trillion (U.S. $218 billion), has come under intense scrutiny for alleged stock manipulation, accounting fraud, and a litany of financial irregularities. The scandal, revealed after a 2-year investigation, raises questions about the Adani Group's practices, with specific attention given to its West Terminal project in the Colombo Port, which has received funding from the U.S. government-run International Development Finance Corporation (DFC).
The Adani-led West Terminal project in Colombo Port, financed with $553 million from the DFC, is now under the spotlight. Questions arise about the propriety of U.S. taxpayers' funds being utilized in a project associated with a conglomerate facing serious allegations of financial misconduct.
Hindenburg Research, a well-known financial analysis group, has publicly questioned the financial credibility of the Adani Group in a recently published document. The report suggests that the conglomerate, led by Founder and Chairman Gautam Adani, has engaged in a decades-long stock manipulation and accounting fraud scheme.
The investigation, involving interviews with former senior executives and diligent site visits in multiple countries, reveals Gautam Adani's meteoric rise in wealth, amassing over $100 billion in the past three years through stock price appreciation. The report claims that the seven key listed companies of the Adani Group have seen a staggering 819% average spike in their stock prices during this period.
The findings also highlight the precarious financial position of the Adani Group, with five out of seven key listed companies reporting 'current ratios' below 1, indicating near-term liquidity pressure. The Adani Group's top ranks, with eight out of 22 key leaders being Adani family members, raises concerns about the concentration of financial control within the family, described by a former executive as "a family business."
The Adani Group has been the subject of four major government fraud investigations, alleging money laundering, theft of taxpayer funds, and corruption, amounting to an estimated U.S. $17 billion. The report claims that Adani family members cooperated to create offshore shell entities in tax-haven jurisdictions, generating forged import/export documentation to siphon money from listed companies.
Gautam Adani's brother, Rajesh Adani, and brother-in-law, Samir Vora, have faced accusations of being central figures in a diamond trading scam. Both were subsequently promoted within the Adani Group despite legal challenges. Vinod Adani, described as an elusive figure, has been implicated in managing a network of offshore entities to facilitate fraud.
The report details an extensive network of offshore shell entities controlled by Vinod Adani, potentially used for stock manipulation, earnings manipulation, and money laundering. It discloses irregularities in supposed "public" funds holding Adani stocks, with some exhibiting characteristics of being shell entities. The report suggests that these practices may lead to the delisting of Adani companies if SEBI's rules are enforced.
While Gautam Adani claims to welcome criticism, the report highlights his attempts to silence critics through legal actions. The investigation concludes with 88 questions for Adani, challenging the conglomerate to address the allegations and provide transparency.
The report also implicates John Keels, Adani's local agent accused of land grabbing from state-owned stocks. John Keels' share valuation is under question, with operational activities and borrowing raising eyebrows among financial analysts. Moreover, John Keels' association with Milinda Moragoda, who defaulted to Sri Lankan state banks, adds another layer of complexity to the unfolding scandal.
In the wake of these damning revelations, the global business community, regulatory authorities, and the public eagerly await responses from the Adani Group and the implicated entities. The alleged scale of corruption and financial irregularities could have far-reaching consequences, warranting thorough investigations and accountability.
by (2024-01-01 18:06:05)
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