SEC brings charges against BIT Mining Ltd, Azure Power Global Ltd and Adani Green Energy Ltd in alleged massive bribery schemes
This week, the Securities and Exchange Commission (the “SEC“) brought charges in three separate alleged massive bribery schemes.
In action #1, brought on November 18, 2024, the SEC announced that BIT Mining Ltd., formerly known as 500.com Limited, agreed to pay a $4 million civil penalty to resolve charges that it violated the Foreign Corrupt Practices Act (FCPA) from 2017 to 2019 by engaging in a widespread bribery scheme to influence numerous foreign officials, including members of Japan’s parliament, in efforts to establish an integrated resort casino in Japan.
500.com was an online sports lottery service provider headquartered in Shenzhen, China, whose shares traded on the New York Stock Exchange (“NYSE”) under the symbol “WBAI.” In 2021, the issuer changed course and entered the cryptocurrency industry, changing its name and symbol to BIT Mining Ltd (BTCM). As of today, it trades on the NYSE.
The SEC’s order finds that the bribery scheme involved illicit payments of approximately $2.5 million in the form of cash bribes, entertainment, and extravagant trips. The order further finds that the bribes were authorized by a 500.com senior executive and that, after the bribery scheme came to light, the company never entered the market.
BIT Mining consented to the SEC’s order finding that it violated the anti-bribery, recordkeeping, and internal accounting controls provisions of the FCPA. BIT Mining has agreed to cease and desist from committing or causing any violations and any future violations of these provisions and to pay the civil penalty mentioned above.
In a parallel action, the U.S. Department of Justice announced today it has entered into a deferred prosecution agreement in which BIT Mining agreed to pay a $10 million criminal fine, of which $4 million will be satisfied by the company’s payment of a civil penalty pursuant to the SEC’s order. The U.S. Department of Justice also announced an indictment against the former CEO of 500.com (now BIT Mining Ltd.), Zhengming Pan, a Chinese national, with violations of the Foreign Corrupt Practices Act (FCPA).
In Actions #2 and #3, brought on November 20, 2024, the SEC charged Gautam Adani and Sagar Adani, executives of Adani Green Energy Ltd., and Cyril Cabanes, an executive of Azure Power Global Ltd., for conduct arising out of a massive bribery scheme. According to the SEC’s allegations, the bribery scheme was orchestrated to enable the two renewable energy companies to capitalize on a multi-billion-dollar solar energy project that the companies had been awarded by the Indian government.
During the alleged scheme, Adani Green raised more than $175 million from U.S. investors and Azure Power’s stock was traded on the New York Stock Exchange. Today, Azure Power is still traded in the U.S. on the OTC Markets Expert Market under the symbol AZREF.
The SEC charged Gautam Adani, Chairman of Adani Green’s Board of Directors, and his nephew, Sagar Adani, Executive Director of Adani Green’s Board. According to the SEC’s complaint, Gautam and Sagar Adani orchestrated a bribery scheme that involved paying or promising to pay the equivalent of hundreds of millions of dollars in bribes to Indian government officials to secure their commitment to purchase energy at above-market rates that would benefit Adani green and Azure Power. As alleged, Gautam and Sagar Adani were engaged in the bribery scheme during a September 2021 note offering by Adani Green that raised $750 million, including approximately $175 million from U.S. investors. The Adani Green offering materials included statements about its anti-corruption and anti-bribery efforts that were materially false or misleading in light of Gautam and Sagar Adani’s conduct.
The SEC charged Cyril Cabanes, a former member of Azure Power’s Board of Directors, with Foreign Corrupt Practices Act (FCPA) violations for his role in the alleged bribery scheme. According to the SEC’s complaint, Cabanes allegedly facilitated the authorization of bribes in furtherance of the scheme while in the United States and abroad.
The SEC’s complaint against Gautam and Sagar Adani charges them with violating the antifraud provisions of the federal securities laws. The complaint seeks permanent injunctions, civil penalties, and officer and director bars.
The SEC’s complaint against Cabanes charges him with violating the FCPA and seeks a permanent injunction, a civil penalty, and an officer and director bar. Both complaints were filed in the U.S. District Court for the Eastern District of New York.
In a parallel action, the U.S. Attorney’s Office for the Eastern District of New York today unsealed criminal charges against Gautam and Sagar Adani and Cabanes, among other individuals connected to Adani Green and Azure Power.
To speak with a Securities Attorney, please contact Brenda Hamilton at 200 E Palmetto Park Rd, Suite 103, Boca Raton, Florida, (561) 416-8956, or by email at [email protected]. This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as and does not constitute legal advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed herein do not guarantee similar outcomes.
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