Hindenburg Research escalates its feud with SEBI and Chairperson Madhabi Puri Buch, alleging conflicts of interest and financial impropriety linked to the Adani Group. Discover the latest developments in this ongoing controversy and SEBI’s response.
Hindenburg Research has intensified its ongoing dispute with India’s Securities and Exchange Board of India (SEBI) and its Chairperson Madhabi Puri Buch. The latest round of allegations from the US-based short-seller raises new concerns about conflicts of interest and financial impropriety tied to the Adani Group. This follows a vehement denial from Buch and her husband regarding prior accusations of leniency and misconduct.
Hindenburg’s New Allegations
In a recent statement, Hindenburg Research has leveled fresh allegations against SEBI and its chief, Madhabi Puri Buch. The firm claims that Buch and her husband had stakes in offshore funds linked to the Adani Group, suggesting a serious conflict of interest. These claims come in the wake of a lengthy feud that began with Hindenburg’s explosive January 2023 report accusing the Adani Group of corporate malfeasance and stock manipulation.
Hindenburg asserts that Buch’s response to their initial report inadvertently confirms their allegations. According to the short-seller, Buch’s investment in obscure Bermuda/Mauritius fund structures, allegedly associated with funds siphoned by Vinod Adani, raises serious concerns. They also allege that Buch’s husband’s childhood friend, who was an Adani director, managed these funds, further complicating the conflict-of-interest allegations.
Allegations of Consulting Firms and Transparency Issues
Hindenburg Research has also scrutinized Buch’s business dealings beyond her role at SEBI. The firm alleges that Buch maintained active consulting firms while serving as SEBI Chairperson. Notably, Agora Advisory Limited (India), a consulting firm she established during her time in Singapore, is reportedly 99% owned by Buch and generated revenue while she oversaw investigations into the Adani Group.
Additionally, Hindenburg accuses Buch of using her personal email for business transactions under her husband’s name during her tenure as a SEBI Whole Time Member. They question the transparency of her consulting activities and have called for a public release of client lists and engagement details from both her Singaporean and Indian consulting firms.
SEBI and Buch’s Response
In response, Buch and her husband have vehemently denied the allegations. They describe Hindenburg’s claims as “baseless” and “malicious,” asserting that the fund in question never invested in Adani securities. They maintain that their stake in the fund was minor and that they had no influence over investment decisions.
SEBI has defended its handling of the Adani-Hindenburg case, asserting that 23 out of 24 investigations are complete, with the final investigation nearing closure. The regulator attributes the lengthy process to the complexities of enforcement procedures. Furthermore, SEBI has initiated its own proceedings against Hindenburg Research, accusing the firm of misleading disclosures designed to profit from short selling.
The feud between Hindenburg Research and SEBI, particularly with its Chairperson Madhabi Puri Buch, continues to unfold with escalating allegations and counterclaims. As the controversy progresses, the financial community and the public remain keenly observant of how these allegations and investigations will impact both SEBI’s regulatory stance and the broader Indian stock market.
