SEBI chief denies Hindenburg’s allegations; calls it a character assassination attempt

Securities and Exchange Board of India (SEBI) chairperson Madhabi Puri Buch and her husband Dhaval Buch have denied the allegations levelled against them by U.S. short-seller Hindenburg, calling it an attempt to character assassination. In a report released overnight, the U.S.-based short seller alleged that the chairperson of India’s stock market regulator, in charge of probing the Adani-Hindenburg case, herself had a stake in offshore funds that were invested in the billionaire Gautam Adani-led Adani Group.

“In the context of allegations made in the Hindenburg Report dated August 10, 2024, against us, we would like to state that we strongly deny the baseless allegations and insinuations made in the report. The same are devoid of any truth. Our life and finances are an open book. All disclosures as required have already been furnished to SEBI over the years,” Puri and her husband say in a joint statement.

“We have no hesitation in disclosing any and all financial documents, including those that relate to the period when we were strictly private citizens, to any and every authority that may seek them. Further, in the interest of complete transparency, we would be issuing a detailed statement in due course,” the statement read.

“It is unfortunate that Hindenburg Research against whom SEBI has taken an Enforcement action and issued a show cause notice has chosen to attempt character assassination in response to the same,” the release notes.

The SEBI chief issued the statement after Hindenburg Research, which released an adverse report against Adani Group in January last year, has claimed in a fresh report that Puri and her spouse have stakes in "obscure offshore funds used in the Adani money siphoning scandal".

"It has been nearly 18 months since our original report on the Adani Group presented overwhelming evidence that the Indian conglomerate was operating “the largest con in corporate history”. Our report exposed a web of offshore, primarily Mauritius-based shell entities used for suspected billions of dollars of undisclosed related party transactions, undisclosed investment and stock manipulation," says Hindenburg in its report titled "Whistleblower Documents Reveal SEBI’s Chairperson Had Stake In Obscure Offshore Entities Used In Adani Money Siphoning Scandal".

Linking Adani’s relationship with SEBI Chairperson, Madhabi Buch, the report says she and her husband, Dhaval Buch, had hidden stakes in the same obscure offshore Bermuda and Mauritius funds, found in the same complex nested structure, used by Vinod Adani.

Citing whistleblower documents, the short seller says they opened their account with IPE Plus Fund 1 on June 5, 2015, in Singapore. "IPE Plus Fund” is a small offshore Mauritius fund set up by an Adani director through India Infoline (IIFL), a wealth management firm with ties to the Wirecard scandal," says the report. "A declaration of funds, signed by a principal at IIFL states that the source of the investment is

Reacting to the alleged report, opposition parties, including the Congress, has asked the central government to act immediately to eliminate all conflicts of interest in the SEBI investigation of Adani Group. These funds are believed to have been used to amass large stakes in Adani Group companies in violation of SEBI regulations, Congress leader Jairam Ramesh alleges. “It is shocking that Buch would have a financial stake in these same funds,” he says in a statement.

“This raises fresh questions about Gautam Adani’s two 2022 meetings in quick succession with Ms Buch shortly after she became SEBI chairperson. Recall that SEBI was supposedly investigating Adani transactions at the time,” the Congress leader says.