President Donald Trump has signed an executive order directing the Department of Justice to pause enforcement of the 1977 Foreign Corrupt Practices Act (FCPA), which prohibits U.S. companies and foreign firms from bribing foreign government officials to obtain or retain business. The order mandates a 180-day review period to reassess guidelines and policies governing FCPA investigations and enforcement actions. During this period, the initiation of new FCPA investigations or enforcement actions is halted unless an individual exception is determined by the Attorney General.
This move has significant implications for the Adani Group, an Indian multinational conglomerate. Last year, under the Biden administration, the Department of Justice charged Adani Group’s founder, Gautam Adani, and his nephew, Sagar Adani, alleging their involvement in a scheme to pay over $250 million in bribes to Indian officials in exchange for favorable terms for solar power contracts. These charges were brought under the FCPA, citing that the alleged actions involved U.S. investors and markets.
Following the suspension of FCPA enforcement, Adani Group stocks have experienced a notable surge. Investors appear optimistic that the pause in enforcement may lead to a favorable outcome for the company regarding the ongoing investigation. The suspension is perceived as a potential relief for the Adani Group, but the Department of Justice’s stance after the six-month review period remains to be seen.
Critics argue that halting FCPA enforcement could undermine global anti-corruption efforts and diminish accountability for corporations operating internationally. The FCPA has been instrumental in prosecuting misconduct among major corporations, with recent notable cases involving Glencore and Goldman Sachs.
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