Calls for SEBI Chief's Resignation Intensify Amid Hindenburg Allegations

The US-based short seller Hindenburg Research's allegations against SEBI chief Madhabi Buch have sparked a political controversy. The Congress and other INDIA bloc parties are demanding her removal and a joint parliamentary committee (JPC) probe. Meanwhile, the ruling BJP accuses the opposition of conspiring to create financial instability in India.

Hindenburg Research alleged that SEBI chairperson Madhabi Buch and her husband had stakes in offshore funds linked to the Adani money siphoning scandal. Both Madhabi Buch and her husband Dhaval dismissed these claims as baseless, accusing Hindenburg of attacking SEBI's credibility instead of responding to a show-cause notice for violations in India.

Opposition Calls for Action

The Congress has urged the government to act immediately to eliminate conflicts of interest in SEBI's investigation of the Adani Group. They also renewed their demand for a JPC probe into the matter. The party insists that the Supreme Court should take suo motu cognisance of the scam and oversee the investigation, given SEBI's involvement in the allegations.

Rahul Gandhi, Leader of Opposition in Lok Sabha, questioned SEBI's integrity following the allegations against its chairperson. He asked, "Why hasn't SEBI Chairperson Madhabi Puri Buch resigned yet?" Gandhi also questioned who would be held accountable if investors lost their money—PM Modi, the SEBI Chairperson, or Gautam Adani.

Demands for Suspension

The TMC demanded that SEBI chairperson Buch be suspended immediately. TMC leader Derek O'Brien stated, "This situation is extraordinary. BJP is clearly on the backfoot in Parliament. We need both - a JPC as well as an SC monitored probe." TMC MP Mahua Moitra alleged a conflict of interest and capture of SEBI by its chairperson.

Moitra further claimed on X that the SEBI chairperson had invested in and interacted with funds needing investigation. She argued this was a significant conflict of interest and mocked justice. She insisted that SEBI under this chairperson could not be trusted to investigate Adani and called for Supreme Court intervention.

BJP's Response

The BJP accused Congress and other opposition parties of conspiring to create financial instability in India. BJP spokesperson Sudhanshu Trivedi said Hindenburg's allegations were an attempt to discredit SEBI. He noted that such critical reports often emerge just before or during Parliament sessions, suggesting opposition leaders were aware of the report's timing.

BJP leader Rajeev Chandrasekhar claimed Hindenburg's attack on SEBI was in partnership with Congress, aiming to destabilise India's financial system. He described it as an effort to create chaos in one of the world's fastest-growing economies.

Continued Allegations

Congress president Mallikarjun Kharge highlighted that SEBI had previously cleared Adani before the Supreme Court following Hindenburg's January 2023 report. He called for a JPC inquiry into new allegations involving a quid-pro-quo with the SEBI chief. Kharge expressed concerns that PM Modi might continue shielding his ally, compromising India's institutions.

In a statement reposted on X, Congress general secretary Jairam Ramesh said, "The government must act immediately to eliminate all conflicts of interest in the SEBI investigation of Adani." He argued that only a JPC could resolve the seeming complicity of high officials in the Adani mega scam.

Left Parties' Stance

The Left parties also demanded a JPC probe into the allegations. CPI(M) general secretary Sitaram Yechury said on X, "The latest Hindenburg revelations have accused the regulator, SEBI, and its chairperson herself is part of the manipulation." He insisted she must quit immediately for an impartial investigation.

CPI general secretary D Raja called for Prime Minister Modi and Finance Minister Nirmala Sitharaman to address the issue publicly. CPI(ML) general secretary Dipankar Bhattacharya echoed these demands, emphasising the need for a JPC probe.

Adani Group's Response

The Adani Group denied any commercial relationship with Madhabi Buch or her husband. They termed Hindenburg's allegations as malicious and based on selective public information manipulation. In response to these claims, SEBI stated that it had duly investigated allegations against Adani and disclosed conflicts when necessary.

In their detailed statement, Madhabi Buch and her husband reiterated that Hindenburg was served a show-cause notice for violations in India. They criticised Hindenburg for attacking SEBI's credibility instead of addressing these violations.