The Adani Group has been making headlines in the country after details emerged claiming that the government is in talks with the company to have it manage the Jomo Kenyatta International Airport (JKIA).
The Adani group is a business conglomerate founded by Gautam Adani, its Chairman. The group comprises ten publicly traded companies and has invested in transport, logistics, energy, and cement production, among other industries.
As part of its investment in the transport business, Adani Group operates several airports in India, such as Mumbai, Lucknow, Ahmedabad, Mangaluru, Jaipur, and Guwahati airports, among others.
While the group has had its fair share of success in the different sectors it invests in, it is also marred by controversies.
A section of Kenyans has expressed doubt on the suitability of the Adani group managing JKIA, the largest airport in the country, based on these controversies.
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In this article, we outline three main controversies that have rocked Adani Group over the past years:
Adani Group's $310 Million Frozen in Swiss Bank Accounts
On 12 September 2024, Hindenburg Research, an investigative research and reporting firm based in the United States, published a post on X (formerly Twitter) stating that Swiss authorities froze more than $310 million across multiple Swiss bank accounts as part of a money laundering and securities forgery investigation into Adani.
The publication indicated that the investigation dates back to 2021.
"Prosecutors detailed how an Adani frontman invested in opaque BVI/Mauritius & Bermuda funds that almost exclusively owned Adani stocks, according to newly released Swiss criminal court records reported by Swiss media outlet," Hindenburg Research posted.
Gotham City, a Swiss publication cited in the Hindenburg tweet, reported that the Geneva Public Prosecutor's Office started investigating the claims of money laundering long before Hindenburg Research brought the allegations to light.
"More than $310 million belonging to an alleged straw man of billionaire Gautam Adani are seized in five Swiss banks. The Public Prosecutor's Office of the Confederation (MPC) took over the investigation once the case was revealed in the press," Gotham City.
Reacting to the allegations, Adani Group termed them baseless, adding that they have not been mentioned in any such case.
"The Swiss court has neither mentioned our group companies nor have we received any requests for clarification or information from any such authority or regulatory body," Adani said in a statement.
Investigation Against Bribery Claims
In March 2024, credible media outlets such as Bloomberg and Reuters reported that Adani Group was being investigated over bribery claims.
Reuters reported that investigators were looking into the company and its chairman and people linked to the two entities over claims that they were involved in bribing officials in India for favorable treatment on an energy project.
"The U.S. Attorney's office for the Eastern District of New York and the Justice Department's fraud unit in Washington are handling the investigation and are also looking at Indian renewable energy company Azure Power Global, " Reuters reported.
However, Adani Group claimed they were unaware of any such investigations.
Investing in Publicly Traded Stocks of its Own Companies
In August 2023, the Organized Crime and Corruption Reporting Project (OCCRP), a global network of investigative journalists, released a report accusing the Adani Group of investing millions of dollars in publicly traded stocks of its own companies through offshore entities.
OCCRP claimed that exclusive documents and testimonies from persons with direct knowledge of the Adani Group revealed that the company used two individuals who allegedly invested hundreds of millions of dollars in publicly traded Adani stock using opaque investment funds based in Mauritius.
"The two men, Nasser Ali Shaban Ahli and Chang Chung-Ling have longtime business ties to the family and have also served as directors and shareholders in Adani Group companies and companies associated with one of the family’s senior members, Vinod Adani.
"The documents show that, through the Mauritius funds, they spent years buying and selling Adani stock through offshore structures that obscured their involvement — and made considerable profits in the process. They also show that the management company in charge of their investments paid a Vinod Adani company to advise them in their investments," reads a section of the OCCRP report.
Reacting to the report, Adani Group said the claims lacked merit.
"We have complete faith in the due process of law and remain confident of the quality of our disclosures and corporate governance standards," Adani said.
According to stock market specialists, when a company purchases enormous volumes of its stock, it creates the impression that the business is doing well, thus taking its valuation higher and increasing its chances of getting loans. u
Further, a January 2023 Hindenburg Research report found that key positions in the Adani Group are held by members of the Adani family, a section of whom have previously been investigated over fraud-related claims.
According to the report, Gautam Adani's younger brother, Rajesh Adani, has been arrested twice over fraud-related claims. Nairobi Leo investigated this claim and established that Rajesh had been arrested in 1999 and 2010.
The Hindenburg Research report also claimed that Gautam Adani's brother-in-law, Samir Vora, was accused of providing false statements to regulators. At the same time, Gautam Adani's elder brother, Vinod Adani's name, has allegedly featured in investigations on claims of managing offshore entities used to facilitate fraud.
Nairobi Leo looked into the claim and found a Forbes article reporting that Vinod was found to have offshore companies that engaged in "questionable transactions."
Responding to the allegations, Adani Group termed the allegations as an attack on India and its business ventures.
"This is not merely an unwarranted attack on any specific company but a calculated attack on India, the independence, integrity and quality of Indian institutions, and the growth story and ambition of India," reads a section of the group's response.
The above are some of the controversies that have rocked the business conglomerate over the years. Although the accusations are damning, the company has consistently dismissed them and denied being involved in any wrongdoing.
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