US Treasury Dept agrees to $275 million settlement with Adani Enterprises over alleged violations of sanctions on Iran: Report
New Delhi, May 18
The US Department of Treasury on Monday said it has agreed to a USD 275 million settlement with Adani Enterprises over the company's potential liability for 32 alleged violations of US sanctions on Iran, Reuters reported.
It had earlier been reported by US Media in 2025 that Adani Enterprises allegedly imported Iranian oil products into India despite US sanctions in place. The allegations were at the time denied by the Group in an exchange filing which called the media report baseless.
Earlier in another case, the U.S. Securities and Exchange Commission has settled a civil lawsuit against Adani Group Chairman Gautam Adani, subject to court approval.
According to media reports, Court documents show that Gautam Adani agreed to pay civil penalties of $6 million, while his nephew Sagar Adani, agreed to pay $12 million. The proposed settlement doesn't include an admission of guilt, said news reports.
The US SEC had earlier alleged that Gautam Adani, Sagar Adani and others orchestrated an alleged USD 250 million-plus bribery scheme between 2020 and 2024 to secure solar energy contracts in India.On April 8, the U.S. District Court for the Eastern District of New York had accepted a plea filed by the counsels for Gautam and Sagar Adani for a pre-motion conference to dismiss the case.
The councils for Gautam and Sagar Adani informed that they intended to seek to dismiss the US SEC's complaint and, as part of this process, had submitted a letter with the East District New York (EDNY) judge informing the Court that the Defendants are prepared to attend a pre-motion conference should the Court wish to schedule one.
In the letter, the Defendants briefly set out their grounds for dismissal of SEC's complaint, including that the court concerned lacks personal jurisdiction over the Defendants and the claims against them, the SEC's claims are impermissibly extraterritorial, the alleged misstatements by the Defendants are too vague and general for any reasonable investor to rely upon as a guarantee of any concrete fact or outcome, making them in-actionable, and the Defendants' lack of involvement in the transaction bars the SEC's claims against them.
According to the counsels, in September 2021, AGEL conducted a USD 750 million bond offering pursuant to SEC Rule 144A and SEC Regulation S, which are registration exemptions for private resales to qualified institutional buyers (QIBs) and non-US sales. AGEL sold these bonds outside the US through an agreement to non-US underwriters, who then resold the Notes to QIBs. A fraction of those resales is alleged to have been made to "investors in the United States".
AGEL was not a party to these transactions, the lawyers said in the letter to the court. The defendants said that the grounds for dismissal also include the SEC's failure to state a claim on the basis that the defendants are neither based in the US nor conduct activities there that would grant the court jurisdiction and the alleged actions involve non-US entities outside the scope of US law.
The defendants also said that even if the claims are accepted at face value, the complaint fails to establish any actionable legal violation or meet the threshold required to proceed.The defendants said that the Court lacks personal jurisdiction over defendants and the claims against them should be dismissed under Rule 12(b)(2).
The claims according to the lawyers "involve Indian Defendants, an Indian issuer, securities not registered with the SEC and not traded on U.S. exchanges, and underlying conduct alleged to have occurred exclusively in India."
The counsels said, the SEC has not alleged underwriters who purchased the bonds from AGEL were US institutions as they were not, or that the Subscription Agreement underlying the purchases was governed by US law as it wasn't.
Meanwhile, a New York Times Report had claimed that the US Justice Department is contemplating dropping charges against Gautam Adani. The report said that this move has come after Adani hired a new legal team led by Robert J Giuffra Jr. who is part of Sullivan & Cromwell LLP. Giuffra Jr. is also one of US President Donald Trump's personal lawyers, says the NYT Report.
The report further suggested that Giuffra had a meeting last month at the Justice Department's headquarters in Washington.
Citing people familiar with that meeting NYT reports that the council outlined why prosecutors lacked evidence and even jurisdiction to bring the case. The report claims that the council also suggested that Adani could be willing to invest USD 10 billion in the American economy creating 15,000 jobs should the charges be dropped.
NYT reported that prosecutors told the council that such an investment would not have a bearing on the case. However, the counsel's offer did get a favourable response from one Justice Department official reported NYT citing people familiar with the meeting.
— ANI
Reader Comments
The key point here is jurisdiction. How can US courts claim jurisdiction over an Indian company's transactions that happened entirely in India? The Adani legal team is absolutely right - these claims are impermissibly extraterritorial. This sets a dangerous precedent for all Indian companies doing business globally. We need to be careful about how US laws are being applied to non-US entities.
I'm tired of all these allegations against our biggest business houses. Whether it's Adani or Ambani, the pattern is always the same - baseless allegations from foreign media, then settlements without admitting guilt, and finally the charges get dropped. Meanwhile, these companies continue to create thousands of jobs and build infrastructure. If there was real wrongdoing, why is the US Justice Department considering dropping charges? 🤔
As someone who follows international business law, this case highlights the enormous power imbalance in global finance. US agencies can effectively dictate terms to companies worldwide through their control of the banking system. The $275 million settlement, while large, is probably less than what Adani would have spent fighting this in court for years. Smart business decision, but it doesn't mean they're guilty.
One thing that bothers me is how these stories always come out just when Indian companies are making big moves internationally. Is it coincidence that the Iran sanctions story broke around the same time as the bribery allegations? Makes you wonder if there's a coordinated effort to target Indian businesses. Having said that, our companies need to be more careful about compliance with international laws.
V Vikram M