Trump's FCPA Pause Could Benefit Adani Executives Amid Bribery Case
In a major policy shift, US President Donald Trump signed an executive order directing the Justice Department to halt prosecutions under the Foreign Corrupt Practices Act (FCPA) of 1977. The move is expected to bring relief to several American firms and executives, including key officials of the Adani Group, who are facing bribery charges in a US court.
The order instructs Attorney General Pam Bondi to pause all FCPA-related proceedings until new enforcement guidelines are issued, which will prioritize American competitiveness. The White House defended the decision, stating that the FCPA puts US businesses at a disadvantage against international competitors who engage in similar practices. A factsheet released by the administration argued that national security depends on American firms gaining strategic commercial advantages, and curbing 'excessive, unpredictable' enforcement of anti-bribery laws would help level the playing field.
This development comes as a potential reprieve for Adani Group executives, including chairman Gautam S Adani and his nephew Sagar Adani, who are among seven individuals charged in a bribery case filed by US prosecutors in New York. The indictment, dated November 21, 2024, accuses the executives of offering bribes totaling Rs 2,029 crore (approximately $265 million) to Indian government officials to secure solar energy supply contracts. The charges include bribery, fraud, obstruction of justice, and misleading investors.
Sources indicate that the pause in FCPA enforcement may also benefit Azure Power, which had a build-operate-transfer (BOT) deal with an Adani Group firm for a solar project. Since legal proceedings under the case are expected to be delayed until the Justice Department introduces revised policies, industry experts suggest this could provide temporary relief for the Adani Group and its executives.
Neither the Adani Group nor Azure Power have issued an official statement on the development. However, market sentiment reflected optimism, with Adani Enterprises’ stock rising by 3% in early trading on Tuesday before closing 1.37% higher, even as the benchmark Sensex declined by 1.3%.
The FCPA, enacted in 1977, criminalizes the bribery of foreign officials to gain business advantages. In 2024, the US Justice Department and the Securities and Exchange Commission (SEC) launched 26 FCPA-related enforcement actions, with over 31 companies under investigation by year-end.
The indictment against the Adani executives alleges a complex bribery scheme aimed at securing lucrative solar contracts. The other accused individuals include Vneet Jaain, Ranjit Gupta, Rupesh Agarwal, Cyril Cabanes, Saurabh Agarwal, and Deepak Malhotra.
The FBI has described the case as a significant fraud operation, with Assistant Director James E. Dennehy stating that the defendants not only engaged in bribery but also attempted to mislead investors and obstruct justice.
With Trump’s order effectively freezing FCPA prosecutions, the fate of the Adani Group executives now hinges on the revised enforcement policies that the US Justice Department is expected to introduce in the coming months.
