New Delhi: On Sunday, SEBI Chairperson Madhabi Puri Buch and her husband Dhaval Buch issued a comprehensive rebuttal against the latest allegations put forth by Hindenburg Research. The US-based short-seller’s report claimed that Madhabi Buch had stakes in “obscure offshore entities” linked to the Adani money siphoning scandal. Both Madhabi and Dhaval Buch rejected these claims as baseless and part of an attempt to discredit SEBI and its leadership.
In their detailed statement, the Buchs addressed the allegations directly, aiming to clear any misconceptions and reaffirm their commitment to transparency. Here’s the full statement:
In light of the allegations made by Hindenburg Research on August 10, 2024, we wish to address these concerns comprehensively and maintain our commitment to full transparency. The allegations against SEBI will be addressed independently by the institution, but we will focus on the issues concerning us personally.
1. Professional Backgrounds:
Madhabi Puri Buch is an alumnus of IIM Ahmedabad and has over two decades of experience in banking and financial services, primarily with the ICICI Group. Dhaval Buch, an alumnus of IIT Delhi, has a distinguished 35-year career with Hindustan Unilever Limited in India and globally with Unilever. The wealth and investments accumulated by us are a result of our salaries, bonuses, and stock options over our respective careers. The insinuation that our current government salary is linked to these investments is both malicious and unfounded.
2. Investments and Professional Moves:
Between 2010 and 2019, Dhaval lived and worked in London and Singapore with Unilever. Madhabi resided and worked in Singapore from 2011 to March 2017, first with a private equity firm and later as a consultant. The investment mentioned in the Hindenburg report was made in 2015 when we were private citizens residing in Singapore, nearly two years before Madhabi joined SEBI as a Whole Time Member.
The decision to invest in this fund was influenced by the Chief Investment Officer, Mr. Anil Ahuja, who is Dhaval’s long-time friend from school and IIT Delhi. Mr. Ahuja, with his extensive experience from Citibank, J.P. Morgan, and 3i Group plc, was a key factor in our investment decision. Notably, when Mr. Ahuja left his position as CIO in 2018, we redeemed our investment. Mr. Ahuja has confirmed that the fund did not invest in any bonds, equities, or derivatives of any Adani group company.
3. Dhaval’s Appointment and SEBI’s Recusal Norms:
Dhaval’s appointment as Senior Advisor to Blackstone Private Equity in 2019 was based on his deep expertise in Supply Chain management, which predates Madhabi’s appointment as SEBI Chairperson. This appointment was publicly disclosed, and Dhaval has not been involved with Blackstone’s Real Estate sector. Consequently, the Blackstone Group was promptly added to Madhabi’s recusal list maintained with SEBI.
4. SEBI’s Regulatory Actions:
Over the past two years, SEBI has issued over 300 circulars, including initiatives to ease business operations in line with its developmental mandate. All SEBI regulations are approved by its Board after thorough public consultation. Claims that some of these regulations were tailored to benefit specific parties are unfounded.
More Read
5. Consulting Companies and Disclosures:
The two consulting firms set up by Madhabi during her time in Singapore, one in India and one in Singapore, became inactive upon her appointment to SEBI. These companies and Madhabi’s shareholding in them were fully disclosed to SEBI. After Dhaval’s retirement from Unilever in 2019, he used these companies to start a consultancy practice focused on Supply Chain management, serving prominent Indian clients. Linking these activities to Madhabi’s current government salary is unfounded.
6. Compliance and Transparency:
When Dhaval transferred his shareholding in the Singapore entity, this was disclosed to SEBI, Singapore authorities, and Indian tax authorities. SEBI enforces rigorous disclosure and recusal norms as per its code of conduct, which we have consistently adhered to.
7. Response to Hindenburg:
Hindenburg Research has been issued a show cause notice for various violations in India. It is regrettable that instead of responding to this notice, they have chosen to attack SEBI’s credibility and attempt to assassinate the character of its Chairperson.
The Buchs’ detailed statement aims to address the allegations head-on and reinforce their commitment to transparency and integrity. As the situation evolves, all parties involved are expected to continue navigating this complex issue with due diligence.
