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What does Sebi do? What is its role in the Hindenburg vs Adani probe?
Hindenburg Research alleges Sebi chairperson Madhabi Puri Buch and husband have ties with Adani Group, causing conflicts of interest. They deny allegations.
US-based Hindenburg Research has alleged that Sebi chairperson Madhabi Puri Buch and her husband Dhaval Buch had ties with the Adani Group, accusing the market regulator's chairperson of conflict of interest that “hindered a thorough investigation into allegations of manipulation and fraud at the Gautam Adani's group”.
The Buchs have strongly denied the allegations.
ALSO READ- Hindenburg-Adani saga: Who is Madhabi Puri Buch? Who is Dhaval Buch?
What is Sebi, and what are its functions?
• The Securities and Exchange Board of India, or Sebi, is expected to protect investor interests, promote the development of the securities market, and regulate it under the Sebi Act, 1992
• Sebi has the authority to make rules, enforce them, and also adjudicate disputes under the Sebi Act, Securities Contracts (Regulation) Act, 1956, the Depositories Act, 1996, the Companies Act, 2013 and others.
• Sebi works for the development and regulation of the securities market in India, ensuring investor protection through awareness programmes, financial literacy initiatives, and addressing investor grievances.
• Sebi also works on global securities standards as part of the International Organization of Securities Commissions (IOSCO).
Sebi investigating charges against Adani Group
Sebi had taken up the investigation into Hindenburg’s accusations against the Adani Group. The firm had accused the conglomerate of share price manipulation and accounting fraud.
Last year, Sebi informed a Supreme Court-appointed panel that it was investigating 13 opaque offshore entities that held significant stakes in Adani's publicly traded stocks.
The apex court dismissed a plea for a court-monitored investigation into Hindenburg's allegations against Adani, stating there was no regulatory failure by Sebi.
ALSO READ- Opposition hits out over new Hindenburg report: ‘In true Adani style…’
Sebi charged Hindenburg with making unfair profits
Although Sebi sent show-cause notices to Adani's flagship companies earlier this year, the final report on the investigation, due to the Supreme Court in April, is still pending.
Last month, Sebi issued a show-cause notice to Hindenburg, accusing the firm of making "unfair" profits through "collusion" and using "non-public" and "misleading" information to induce "panic selling" in Adani Group stocks.
According to Sebi, Hindenburg had shared an advance copy of its report against the Adani Group with a New York-based hedge fund manager, profiting from the resulting share price movements.
