Mumbai: Two overseas investment firms, believed to be closely connected to the Adani Group, which is facing a barrage of accusations related to measures to inflate their stock values, have had their licenses revoked by the Financial Services Commission, the Mauritian regulator.

According to a report published in The Indian Express, revocation comes as a result of alleged non-compliance with a range of financial regulations.

Emerging India Fund Management Limited, the entity in question, has had its business and investment licenses cancelled due to purported violations related to money laundering, accounting and auditing standards, corporate governance, and the maintenance of client and transaction records.

The Financial Services Commission emphasized that when licenses are revoked, it is done on a permanent basis. Affected licensees are now obligated to initiate necessary actions for the orderly dissolution of their business operations and the settlement of their liabilities.

This development holds particular significance as records from India's market regulator, the Securities and Exchanges Board of India (SEBI), reveal that Emerging India Fund Management Limited is the controlling shareholder of Emerging India Focus Funds and EM Resurgent Fund, both of which are under investigation for their ties to the Adani Group. SEBI has been actively investigating 13 overseas entities holding Adani shares, but so far, the progress of this investigation has been described as inconclusive.

The Adani Group responded to inquiries regarding the license revocation by stating that they cannot comment on matters pertaining to their "independent individual shareholders."

The alleged irregularities involving Emerging India Fund Management were not part of a report published by American firm Hindenburg Research in January. The report had made serious allegations against the Adani Group, accusing them of engaging in accounting fraud, improper use of tax havens, and money laundering, which the conglomerate vehemently denied. Nevertheless, the report had a significant impact on the stock prices of Adani Group's listed companies.

In another recent report, the Organized Crime and Corruption Reporting Project asserted that two investors who injected substantial sums of money into the Adani Group through offshore funds have close ties to its promoters.

This revelation raised concerns about potential violations of stock market rules, as investors Chang Chung-Ling from Taiwan and Nasser Ali Shaban Ahli from the United Arab Emirates were found to have channelled investments into Adani stocks through "opaque" investment funds based in Mauritius.

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