US-based activist short seller Hindenburg Research LLC said that Swiss authorities have frozen over $310 million in funds across multiple Swiss bank accounts as part of an investigation into the Adani group on a post on X (Formerly Twitter) on September 13, 2024, citing a news report by Swiss media outlet Gotham City. HT couldn’t independently verify the information contained in the report.
What are the Swiss authorities investigating the Adani group for?
The Swiss authorities have been allegedly conducting a money laundering and securities forgery investigation of the Adani Group since 2021, well before the first Hindenburg report on Adani titled, ‘Adani Group: How The World’s 3rd Richest Man Is Pulling The Largest Con In Corporate History,’ came out in January 24, 2023, according to the Gotham City report, which cited a Swiss Federal Criminal Court (FCC) ruling.
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What are the details of the case?
A frontman representing Adani invested in opaque funds located in British Virgin Islands/Mauritius, and Bermuda, all of which almost exclusively owned Adani stocks, Hindenburg quoted the news report as saying.
The report further stated that more than $310 million of the frontman had been kept in six Swiss banks, which have all been frozen now.
This comes just a month after Hindenburg Research published a report (On August 10, 2024) with conflict of interest allegations against Madhabi Puri Buch, the chairperson of India’s market regulator Securities Exchange Board of India (Sebi).
The report alleged that Buch owned stakes in offshore entities related to the Adani Group, along with her husband Dhaval Buch, which was used as part of a money siphoning scandal.
Madhabi Puri Buch and Dhaval Buch jointly denied all the allegations contained in the report.
Who is Hindenburg Research?
Hindenburg Research LLC, was founded in 2017 by Nathan Anderson. It is a US-based investment research and short selling firm that publishes reports, exposing frauds or corruption in companies, after taking a short position on the company’s stocks.
What does short selling and taking a short position mean?
Short selling is when an investor foresees a fall in the value of a company’s share and therefore, enters into a short selling arrangement with a broker where the investor borrows shares of the company and sells it at the prevailing market prices, then buys shares of the same company after the share price falls and returns the shares.
How did Adani Group shares perform?
Adani Enterprises Ltd shares closed at ₹2,991.40 on the Bombay Stock Exchange (BSE) after the trading session on September 13, 2024. This was a gain of 1.84% or 54.05 points.
Hindenburg’s post on X came at 9:50 pm IST on the same day.
Adani Ports and Special Economic Zone Ltd shares closed at ₹1,472.25, a gain of 2.94% or 42.05 points.
Adani Green Energy Ltd closed at ₹1,809.00, a drop of 0.30% or 5.40 points.
Adani Power Ltd closed at ₹651.35, a gain of 3.92% or 24.55 points.
Ambuja Cements Ltd closed at ₹628.95, a gain of 1.04% or 6.50 points.
Adani Total Gas Ltd closed at ₹805.40, a drop of 0.06% or 0.45 points.
Adani Wilmar Ltd closed at ₹362.20, a gain of 1.43% or 5.10 points.
ACC Ltd shares closed at ₹2,467.05 gain of 1.18% or 28.75 points.
New Delhi Television Ltd closed at ₹192.40, a drop of 0.57% or 1.10 points.
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