Congress Urges JPC Probe Into SEBI Allegations Following Hindenburg Report

The Congress party criticised the Modi government on Sunday over allegations made by Hindenburg Research against SEBI Chairperson Madhabi Buch. Rahul Gandhi stated that the integrity of the market regulator has been severely compromised and called for a Joint Parliamentary Committee (JPC) probe into the matter. He also questioned Prime Minister Narendra Modi's reluctance to initiate such an investigation.

Allegations Against SEBI Chairperson

US short-seller Hindenburg Research accused SEBI Chairperson Madhabi Buch and her husband of having stakes in offshore funds linked to the alleged Adani money siphoning scandal. Both Buch and her husband have denied these claims, calling them baseless and asserting that their finances are transparent. The Adani Group also dismissed the allegations as malicious and based on selective public information.

Congress President Mallikarjun Kharge highlighted that SEBI had previously cleared Adani before the Supreme Court following the January 2023 Hindenburg Report revelations. He mentioned new allegations suggesting a quid-pro-quo involving the SEBI chief. Kharge emphasised the need to protect small and medium investors who trust SEBI with their investments.

Calls for Judicial Intervention

The Congress party urged the Supreme Court to take suo motu cognisance of the scam and investigate it under its supervision, given that SEBI itself is accused of involvement. Congress spokesperson Supriya Shrinate questioned what PM Modi and his government have to say about their market regulator being surrounded by such allegations.

In a post on X, Rahul Gandhi said, "The integrity of SEBI, the securities regulator entrusted with safeguarding the wealth of small retail investors, has been gravely compromised by the allegations against its Chairperson." He further asked why Madhabi Puri Buch hasn't resigned yet and who would be held accountable if investors lose their money—PM Modi, the SEBI Chairperson, or Gautam Adani?

Concerns Over Regulatory Integrity

Jairam Ramesh, Congress General Secretary, noted SEBI's reluctance to investigate the Adani mega scam, as observed by the Supreme Court's Expert Committee. He pointed out that SEBI had diluted reporting requirements related to foreign funds' actual ownership in 2018 and deleted them entirely in 2019. This, he said, has led to SEBI drawing a blank worldwide despite suspecting wrongdoing.

Ramesh also raised questions about Gautam Adani's two meetings with Buch in 2022, shortly after she became SEBI chairperson. He called for immediate government action to eliminate conflicts of interest in SEBI's investigation of Adani.

Press Conference Highlights

At a press conference, Supriya Shrinate posed several questions to Buch. She asked if Buch had ever held shares in Agora Partners in Singapore or India while serving as a whole-time director at SEBI. Shrinate also inquired whether Buch disclosed this shareholding and income received from it and if she transferred her stake to her husband in 2022.

Shrinate further questioned whether Buch informed SEBI about her husband's association with Blackstone, a major player in REIT investment. She asked if Buch recused herself from investigating funds she or her husband were invested in and why she didn't do so if she hadn't.

Demands for Accountability

Shrinate demanded clarity on whether Buch can continue as SEBI chief amid these allegations or should be removed immediately. She also questioned whether this alleged collusion between Adani and Buch was possible without PM Modi's protection.

All India Professionals Congress Chairperson Praveen Chakravarty stressed the importance of ethical, legal, and optical integrity for technocrats and lateral entrants in public positions. The Congress party continues to press for a thorough investigation into these serious allegations to uphold market integrity.

The ongoing controversy has raised significant concerns about regulatory oversight and accountability within India's financial markets.