SEBI chief, Adani deny Hindenburg charges as Cong demands parliamentary probe
Hindenburg alleged that Madhabi Puri Buch, who is in charge of probing the allegations, had a stake in obscure offshore entities used for the purpose
New Delhi: Securities Exchange Board of India (SEBI) chairperson Madhabi Puri Buch and her husband Dhaval Buch denied US-based short-seller Hindenburg Research’s allegations that they had a stake in obscure offshore entities used in "the Adani money siphoning scandal” while the Adani Group dismissed the charges as "malicious, mischievous, and manipulative selections of publicly available information”.
The statements came even as a political row erupted with the Congress demanding a parliamentary probe into the charges.
In a statement, the Adani Group said on Sunday that the publicly available information was used to arrive at "pre-determined conclusions for personal profiteering with wanton disregard for facts and the law”.
"We completely reject these allegations against the Adani Group, which are a recycling of discredited claims that have been thoroughly investigated, proven to be baseless, and already dismissed by the Hon'ble Supreme Court in January 2024," it said.
The conglomerate reiterated that its overseas holding structure is fully transparent, with all details disclosed regularly in public documents.
The Adani Group said it has no commercial relationship with the individuals or matters mentioned in "this calculated deliberate effort to malign” it.
"We remain steadfastly committed to transparency and compliance with all legal and regulatory requirements," it added.
The statement also dismissed Hindenburg as a discredited short-seller under the scanner for violations of Indian securities laws. "Hindenburg's allegations are no more than red herrings thrown by a desperate entity with total contempt for Indian laws."
In a separate statement earlier in the day, Madhabi Puri Buch and Dhaval Buch cited SEBI's action and show cause notice to the American investment research firm focused on activist short-selling and added that Hindenburg chose to attempt “character assassination” in response to 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," the couple said. They added that all their financial disclosures have been furnished to the stock market regulator 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. Further, in the interest of complete transparency, we will be issuing a detailed statement in due course,” they added.
In 2023, Hindenburg accused the Adani Group of stock price manipulation. The US-based short seller on Saturday alleged that Madhabi Puri Buch, who is in charge of probing the allegations, had a stake in obscure offshore entities used for the purpose.
Hindenburg Research cited documents from a whistleblower and alleged Madhabi Puri Buch and Dhaval Buch held stakes in offshore Bermuda and Mauritius funds via complex structures. It alleged that Dhaval Buch wrote to a Mauritius fund administrator to make him the “sole person authorised to operate the accounts” weeks before Madhabi Puri Buch's appointment as a whole-time SEBI member in 2017.
Hindenburg's January 2023 report accused Adani Group of using tax havens and stock manipulation. It led to a $150 billion sell-off in the conglomerate's stocks, which have since recovered partially. The report prompted an ongoing SEBI enquiry.
The Supreme Court in January refused to order a separate probe into the allegations of accounting fraud and stock manipulation against Adani Group, saying there was no material to show SEBI's “glaring, willful, or deliberate inaction” in its investigation or any suggestion of regulatory failure. The court dismissed the reliance on the Hindenburg report or other unsubstantiated news reports as the basis for questioning SEBI’s comprehensive investigation.
The Supreme Court last month dismissed a petition demanding a review of its January verdict. It rejected a plea for the creation of a special investigation team to investigate Hindenburg’s allegations, noting that newspaper articles or reports by third-party organisations cannot be treated as conclusive proof of SEBI's probe inadequacy.
Six Adani Group firms in May said they received SEBI notices over alleged violations of stock market norms. SEBI also sent a "show cause" notice to Hindenburg Research over alleged violations of rules to set up a short bet based on non-public information. Hindenburg dismissed the allegations as "nonsense" in July.
The fresh allegations prompted the opposition Congress to ask the government to "eliminate all conflicts of interest in the SEBI investigation of Adani". In a statement posted on X, Congress leader Jairam Ramesh demanded the constitution of a parliamentary probe to "investigate the full scope" of the Adani matter.
Congress has repeatedly criticised the alleged close links between the ruling Bharatiya Janata Party (BJP) and the conglomerate.
In a post on X, BJP spokesperson Sudhanshu Trivedi attacked the Congress, questioning why it is against the Indian companies, whether government or private, and defends the foreign ones. "I have never seen Congress speak against any foreign company, but they would take a stand against Indian companies. We believe Swadeshi [domestic production] movement and Make in India."
He said the companies Congress leader Rahul Gandhi abuses have earned record revenue, and the profit is at an all-time high.