SEBI Chairman and His Husband Deny Hindenburg’s Accusations

Mumbai (Maharashtra) (India), August 11 (ANI): A day after US-based short-selling firm Hindenburg Research alleged that SEBI Chairwoman Madhabi Puri Buch and her husband Dhaval Buch had stakes in “both little-known offshore entities involved in the Adani money laundering scandal”, the SEBI Chairwoman and her husband issued a detailed statement rejecting the allegations.

This came after they issued a short statement on Sunday in which they accused Hindenburg of tarnishing their reputation.

The statement said Madhabi Buch is an IIM Ahmedabad graduate and has a corporate career spanning over two decades in banking and financial services, primarily with ICICI Group. From 2011 to March 2017, Madhabi lived and worked in Singapore, initially as an employee of a private equity firm and later as a consultant.

Dhaval Buch is an IIT Delhi graduate and has a 35-year corporate career with Hindustan Unilever Limited in India and then with Unilever globally as a member of the senior management team. From 2010 to 2019, Dhaval lived and worked in London and Singapore, both with Unilever.

“During this long period, Madhabi and Dhaval accumulated savings through their salaries, bonuses and stock options. The insinuations regarding their net worth and investments referring to Madhabi’s current government salary are malicious and motivated,” the statement said. The statement said, “The investment in the fund mentioned in the Hindenburg report was made in 2015 when both were private citizens residing in Singapore and almost 2 years before Madhabi joined SEBI even as a full-time member.” “The decision to invest in this fund was taken because the Chief Investment Officer, Anil Ahuja, is a childhood friend of Dhaval from school and IIT Delhi and being a former employee of Citibank, JP Morgan and 3i Group plc, he has a strong investment career spanning decades. That these were the factors driving the investment decision is supported by the fact that when Ahuja left his position as CIO of the fund in 2018, we bought back the investment in the fund,” the statement continued.

“As confirmed by Anil Ahuja, the fund has not invested in any bonds, shares or derivatives of any Adani group company at any point of time,” the statement added.

The joint statement also raises the issue of employment of the SEBI chairwoman’s husband at Blackstone Equity.

“Dhaval’s appointment in 2019 as Senior Advisor to Blackstone Private Equity was based on his deep expertise in supply chain management. Thus, his appointment precedes Madhabi’s appointment as Chairman of SEBI. Since then, the appointment has remained in the public domain. Dhaval was never associated with Blackstone’s real estate arm. Following his appointment, Blackstone Group was immediately added to Madhabi’s debarment list maintained by SEBI,” the statement read.

“In the last two years, SEBI has issued over 300 circulars (including ‘Ease of Doing Business’ initiatives in line with SEBI’s development mandate) across the market ecosystem. All SEBI regulations are approved by its Board (and not by its Chairman) after extensive public consultation. The insinuation that a handful of these REIT-related matters were a favour to any particular party is malicious and motivated,” the statement added.

The joint statement also raises the issue of consultancy firms that were set up by the SEBI Chairwoman before she assumed office.

“Two consultancies set up by Madhabi during her stay in Singapore, one in India and one in Singapore, immediately became dormant after her appointment to SEBI. These firms (and her holdings in them) were clearly part of her disclosures to SEBI,” the statement said.

“After Dhaval retired from Unilever in 2019, he started his consulting business through these companies. Dhaval’s deep expertise in supply chain has allowed him to work with prominent clients in the Indian industry. Therefore, linking the accruals in these companies with Madhabi’s current government salary is mischievous. When the stake in the Singapore unit transferred to Dhaval, the same was again disclosed, not only to SEBI but also to the Singapore authorities and the Indian tax authorities,” the statement added.

The joint statement also stated that the Bucha couple had disclosed all this information to the appropriate agencies.

“SEBI has strong institutional mechanisms for disclosure and exemption norms in line with the Code of Conduct applicable to its officers. Accordingly, all disclosures and exemptions were diligently followed, including disclosure of all securities held or subsequently transferred,” the statement said.

“Hindenburg has been served with show cause notices for various violations in India. Unfortunately, instead of responding to the show cause notice, they have chosen to attack the credibility of SEBI and attempt to defame the Chairperson of SEBI,” it added. Earlier on Saturday, US-based Hindenburg Research alleged that SEBI Chairperson Madhabi Buch and her husband had stakes in “both of the little-known offshore entities used in the Adani money-siphoning scandal”. Hindenburg Research said in its analysis: “We have previously noted Adani’s complete confidence in continuing its business without the risk of major regulatory intervention, suggesting that this can be explained by Adani’s relationship with SEBI Chairperson Madhabi Buch.” “What we didn’t realize: The current SEBI Chairwoman and her husband, Dhaval Buch, had hidden holdings in exactly the same little-known offshore funds in Bermuda and Mauritius, housed in the same complex nested structure used by Vinod Adani,” the U.S. hedge fund said in a report.

In January 2023, Hindenburg released a report accusing Adani Group of financial irregularities, leading to a significant drop in the company’s share price. The group rejected the claims at the time.

In January 2024, the Supreme Court had refused to transfer the probe into allegations of share price manipulation by the Adani group to an SIT and ordered regulator SEBI to complete its probe into two pending cases within three months.

Earlier this year, the Supreme Court also dismissed a review petition against a judgment that directed market watchdog SEBI to conduct an inquiry into the Adani-Hindenburg case. (ANI)