More Stories

Informist, Sunday, Sep 1, 2024

 

MUMBAI – Hindenburg Research has made a fresh allegation that Securities and Exchange Board of India Chairperson Madhabi Puri Buch, despite promising complete transparency with respect to the firm's Aug 10 report alleging she had severe conflict of interest in the Adani group investigation, "has addressed nothing and has been silent for three weeks". The US short-seller firm said this in a post on online social media platform X, formerly Twitter, late on Saturday night.

 

In its post, Hindenburg Research referred to Friday's news report in online news site Scroll which quoted an unnamed SEBI board member as saying that Buch did not recuse herself from the Adani group probe, nor were her disclosures on past investments in an offshore fund alleged by Hindenburg Research to be linked to the Adanis known to everyone on the board or the investigating team. The SEBI board member, as per the news report, said that Buch oversaw the probe "because it was ordered by the Supreme Court".

 

In its Aug 10 report, Hindenburg Research had  alleged, among other things, egregious conflict of interest on the part of Buch in her capacity as SEBI chairperson from Mar 2, 2022, and earlier as a whole-time member from Apr 5, 2017 to Oct 4, 2021, with regard to her role in the investigation. In its first report in January 2023, Hindenburg Research had primarily alleged that the Adani group's promoters and related entities "surreptitiously" owned the shares of listed group companies through linked offshore funds and shell companies and that this was "seemingly in blatant violation" of SEBI's rules.

 

In response to Hindenburg's Aug 10 report, SEBI Chairperson Buch, in a private statement the next day along with her husband Dhaval Buch, had said that "the investment in the fund referred to in the Hindenburg report was made in 2015 when they were both private citizens living in Singapore". She further said in the statement that all recusals had been diligently followed by her, as per the internal code of conduct at SEBI.

 

Hindenburg Research also alleged in its Aug 10 report that when Buch was first the whole-time member, she had a 100% stake in Singapore-based consulting firm called Agora Partners. This stake, it alleged, was transferred to her husband on Mar 16, 2022, two weeks after taking over as SEBI chairperson. With regard to this allegation, the Buchs said in their joint statement that "when the shareholding of the Singapore entity moved to Dhaval, this was once again disclosed...to SEBI".

 

The US short-seller had also alleged that SEBI Chairperson Buch currently held 99% stake in a consulting firm in India, Agora Advisory, in which her husband was a director, and which was generating substantial revenues from the business. Hindenburg Research said that given such conflict of interest, SEBI could not be "trusted as an objective arbiter in the Adani matter". Buch had, however, claimed that the Singaporean and Indian consulting companies had become "immediately dormant on her appointment with SEBI" in 2017.

 

Hindenburg Research had also alleged that after her husband Dhaval Buch was appointed in 2019 as a senior advisor in global equity investment firm Blackstone with large investments in real estate investment trusts in India, SEBI facilitated major dilutions in REIT regulations and that the SEBI chairperson, in various speeches in industry forums, actively urged investors to look positively at REITs. This, according to Hindenburg, took place without Buch clarifying that Blackstone, "who her husband advises, stands to gain significantly from the asset class".  End

 

Reported by Rajesh Gajra

Edited by Avishek Dutta

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

 

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2024. All rights reserved.