SEBI Chief Denies Allegations by Hindenburg Research Amid Adani Group Controversy

India’s market regulator chief, Madhabi Puri Buch, strongly denied allegations made by U.S. short-seller Hindenburg Research that her past offshore investments may have compromised her ability to properly investigate corporate malfeasance allegations against the Adani Group.

The allegations arose following a turbulent year for the Adani Group, a vast Indian conglomerate with interests ranging from ports to power. In 2023, the group saw billions of dollars wiped from its market value after Hindenburg Research released a report accusing it of engaging in “brazen” corporate fraud.

Gautam Adani, the founder of the family-run conglomerate and currently ranked as the world’s 12th richest person by Bloomberg, vehemently denied the accusations, labeling them as a “deliberate attempt” to tarnish the group’s image for the benefit of short-sellers.

Hindenburg’s report claimed that Vinod Adani, Gautam Adani’s elder brother, controlled a complex network of offshore shell companies in tax havens such as Mauritius, Cyprus, and several Caribbean islands. This claim led to a major fallout, wiping more than $150 billion off the group’s market value and prompting India’s Supreme Court to direct the Securities and Exchange Board of India (SEBI) to investigate the allegations.

On Saturday, Hindenburg Research further alleged, citing whistleblower documents, that SEBI Chairperson Madhabi Puri Buch and her husband had investments in offshore funds that Vinod Adani allegedly utilized. The report suggested that SEBI’s perceived reluctance to pursue meaningful action against suspect offshore shareholders in the Adani Group could be tied to Buch’s alleged involvement.

Hindenburg claimed that Buch and her husband opened an account in one of these funds in 2015, and that her husband became the sole operator of the account just weeks before Buch’s appointment as a “whole-time member” of SEBI in 2017. Buch was later appointed as SEBI’s chairperson in 2022.

In response, Buch issued a strong rebuttal, stating, “We strongly deny the baseless allegations and insinuations made in the report.” She emphasized that her and her husband’s “life and finances are an open book,” and that all required disclosures had been made to SEBI over the years. “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,” she added.

The Adani Group’s alleged ties to Prime Minister Narendra Modi have also come under scrutiny, with opposition parties and critics suggesting that their close relationship may have helped the conglomerate secure business advantages and avoid proper oversight.

The controversy surrounding the Adani Group and the new allegations against SEBI’s chairperson are likely to intensify scrutiny on both the regulator and the conglomerate as investigations continue.