Hindenburg Research Accuses SEBI Chairperson of Conflicts of Interest in Adani Case
Discover the latest updates and SEBI’s stance on the escalating controversy. against Hindenburg Research. SEBI chief Madhabi Buch to issue a detailed statement soon.
SEBI's Chairperson Madhabi Puri Buch.
US short-seller Hindenburg Research, which notably impacted Adani Group's valuation with its financial irregularity allegations last year, has intensified its scrutiny of India's market regulator, SEBI.
On Saturday, Hindenburg Research released a blog post alleging that SEBI Chairperson Madhabi Puri Buch and her husband Dhaval Buch have investments in “obscure offshore funds” associated with the Adani scandal.
The firm alleged that SEBI’s unexpected inaction on Adani’s purported network of undisclosed Mauritius and offshore shell entities was due to Buch’s concealed financial interests in the conglomerate.
Original Report Exposes Major Financial Issues
Hindenburg Research released its initial report 18 months ago, revealing what it termed “the largest con in corporate history.”
It uncovered a sophisticated network of offshore shell companies, mainly based in Mauritius, that appeared to facilitate billions of dollars in undisclosed related party transactions, hidden investments, and stock manipulation.
SEBI’s Inaction and 'Show Cause' Notice
Despite the extensive evidence and corroboration from over 40 independent media investigations, SEBI has yet to take significant public action against the Adani Group.
Recent reports suggest that SEBI might only impose minor, technical violations, failing to address the full scope of the alleged misconduct.
On June 27, 2024, SEBI issued a ‘show cause’ notice to Hindenburg Research.
Although SEBI did not dispute the factual accuracy of its 106-page report, it criticized Hindenburg Research's disclosure of our short position, arguing for more comprehensive details. SEBI also branded Hindenburg report as “reckless” for quoting a banned broker who claimed SEBI was aware of and involved in the Adani Group’s use of offshore entities.
Response from SEBI Chairperson
SEBI Chairperson Madhabi Puri Buch has rejected Hindenburg Research’s allegations as "groundless" and described them as an attempt at "character assassination."
In response to the recent accusations, both Buch and her husband, Dhaval Buch, have pledged to disclose all their financial records. They emphasised their commitment to transparency and stated that they have always provided complete disclosures to SEBI.
Buch Criticizes Hindenburg’s Allegations
Following the release of Hindenburg Research's report on August 10, the Buchs criticized the accusations as retaliatory and aimed at undermining SEBI’s integrity. They expressed regret that Hindenburg Research chose to engage in character assassination after facing SEBI’s enforcement actions and receiving a show-cause notice. Despite the severity of the claims, the Buchs firmly rejected them and promised a detailed response in the near future to ensure transparency.
