The Crossbill News Desk
In a series of explosive claims, the US short-seller Hindenburg Research has alleged that Madhabi Buch, the chief of the Securities and Exchange Board of India (SEBI), and her husband held stakes in both the obscure offshore funds used in the Adani money siphoning scandal. These accusations are based on "whistleblower documents" revealing their involvement.
The Hindenburg Report in 2023 triggered a series of investigations into alleged irregularities by the Adani Group but was met with minimal or no visible regulatory action in India. The firm's latest report states that despite 18 months having passed since Hindenburg's report on Adani, SEBI has shown a surprising lack of interest in investigating Adani’s alleged undisclosed network of Mauritius and offshore shell entities.
Allegations made by Hindenburg
In its latest report, Hindenburg Research, citing whistleblower documents, claims that the documents reveal Madhabi Buch, the current SEBI Chairperson, and her husband held stakes in both obscure offshore funds involved in the Adani money siphoning scandal.
In its investigation into the funding of Adani's offshore shareholders, the Supreme Court noted that SEBI had "drawn a blank." Hindenburg Research suggests that if SEBI genuinely wanted to identify the offshore fund holders, the SEBI Chairperson might have started by looking in the mirror. The report also states that Hindenburg finds it unsurprising that SEBI was reluctant to pursue a trail that could have led to its own Chairperson.
So far, Hindenburg Research claims that SEBI has not taken action against any other suspected Adani shareholders of Indian origin, specifically those associated with funds operated by India Infoline, such as the EM Resurgent Fund and Emerging India Focus Funds.
Hindenburg Research has alleged that from April 2017 to March 2022, while Madhabi Buch served as a whole time member and later Chairperson at SEBI, she held a 100% interest in an offshore Singaporean consulting firm called Agora Partners. According to the report, Buch quietly transferred the shares to her husband on March 16, 2022, just two weeks after her appointment as SEBI Chairperson.
In 2019, while Madhabi Buch was serving as a whole-time member of SEBI, her husband was appointed as a senior advisor to Blackstone. Hindenburg Research notes that, according to his LinkedIn profile, he had no prior experience working with funds in the real estate or capital markets.
Blackstone, one of the major sponsors and investors in REITs, a new asset class in India, was involved in significant developments during Dhaval Buch's tenure as a senior advisor. According to Hindenburg Research, while Dhaval Buch was in this role and his wife was a SEBI official, Blackstone sponsored the Mindspace and Nexus Select Trust REITs. These were India's second and fourth REITs, respectively, to receive SEBI approval for a public IPO.
According to Hindenburg's allegations, while Dhaval Buch served as an advisor to Blackstone, SEBI proposed, approved, and facilitated significant changes to REIT regulations. These changes reportedly included 7 consultation papers, 3 consolidated updates, 2 new regulatory frameworks, and nomination rights for units, all of which are said to have specifically benefited private equity firms like Blackstone.
Another allegation involves SEBI Chairperson Madhabi Buch referring to real estate investment trusts (REITs) as her "favourite products for the future" and encouraging investors to view the asset class "positively" at industry conferences. Hindenburg Research contends that, in making these statements, Buch failed to disclose that Blackstone—an entity her husband advises—stood to gain significantly from the growth of the REIT asset class.
Yet another allegation is that Madhabi Buch currently owns 99% of the Indian consulting company Agora Advisory, where her husband is a director. Hindenburg Research claims that in 2022, Agora Advisory reported $261,000 in consulting revenue, which is 4.4 times her disclosed salary at SEBI.
Buch denies the allegations
Madhabi Buch however, has denied all the allegation made by the short-seller. Terming the allegations as “baseless,” Buch and her husband in a joint statement said that the US-based short-seller is engaging in character assassination in response to a show-cause notice issued by the regulator in connection with the Adani controversy.
“It is unfortunate that Hindenburg Research against whom SEBI has taken an Enforcement action and issued a show cause notice has chosen to attempt character assassination in response to the same,” the statement read.
The Hindenburg Report in 2023 triggered a series of investigations into alleged irregularities by the Adani Group but was met with minimal or no visible regulatory action in India. The firm's latest report states that despite 18 months having passed since Hindenburg's report on Adani, SEBI has shown a surprising lack of interest in investigating Adani’s alleged undisclosed network of Mauritius and offshore shell entities.
Allegations made by Hindenburg
In its latest report, Hindenburg Research, citing whistleblower documents, claims that the documents reveal Madhabi Buch, the current SEBI Chairperson, and her husband held stakes in both obscure offshore funds involved in the Adani money siphoning scandal.
In its investigation into the funding of Adani's offshore shareholders, the Supreme Court noted that SEBI had "drawn a blank." Hindenburg Research suggests that if SEBI genuinely wanted to identify the offshore fund holders, the SEBI Chairperson might have started by looking in the mirror. The report also states that Hindenburg finds it unsurprising that SEBI was reluctant to pursue a trail that could have led to its own Chairperson.
So far, Hindenburg Research claims that SEBI has not taken action against any other suspected Adani shareholders of Indian origin, specifically those associated with funds operated by India Infoline, such as the EM Resurgent Fund and Emerging India Focus Funds.
Hindenburg Research has alleged that from April 2017 to March 2022, while Madhabi Buch served as a whole time member and later Chairperson at SEBI, she held a 100% interest in an offshore Singaporean consulting firm called Agora Partners. According to the report, Buch quietly transferred the shares to her husband on March 16, 2022, just two weeks after her appointment as SEBI Chairperson.
In 2019, while Madhabi Buch was serving as a whole-time member of SEBI, her husband was appointed as a senior advisor to Blackstone. Hindenburg Research notes that, according to his LinkedIn profile, he had no prior experience working with funds in the real estate or capital markets.
Blackstone, one of the major sponsors and investors in REITs, a new asset class in India, was involved in significant developments during Dhaval Buch's tenure as a senior advisor. According to Hindenburg Research, while Dhaval Buch was in this role and his wife was a SEBI official, Blackstone sponsored the Mindspace and Nexus Select Trust REITs. These were India's second and fourth REITs, respectively, to receive SEBI approval for a public IPO.
According to Hindenburg's allegations, while Dhaval Buch served as an advisor to Blackstone, SEBI proposed, approved, and facilitated significant changes to REIT regulations. These changes reportedly included 7 consultation papers, 3 consolidated updates, 2 new regulatory frameworks, and nomination rights for units, all of which are said to have specifically benefited private equity firms like Blackstone.
Another allegation involves SEBI Chairperson Madhabi Buch referring to real estate investment trusts (REITs) as her "favourite products for the future" and encouraging investors to view the asset class "positively" at industry conferences. Hindenburg Research contends that, in making these statements, Buch failed to disclose that Blackstone—an entity her husband advises—stood to gain significantly from the growth of the REIT asset class.
Yet another allegation is that Madhabi Buch currently owns 99% of the Indian consulting company Agora Advisory, where her husband is a director. Hindenburg Research claims that in 2022, Agora Advisory reported $261,000 in consulting revenue, which is 4.4 times her disclosed salary at SEBI.
Buch denies the allegations
Madhabi Buch however, has denied all the allegation made by the short-seller. Terming the allegations as “baseless,” Buch and her husband in a joint statement said that the US-based short-seller is engaging in character assassination in response to a show-cause notice issued by the regulator in connection with the Adani controversy.
“It is unfortunate that Hindenburg Research against whom SEBI has taken an Enforcement action and issued a show cause notice has chosen to attempt character assassination in response to the same,” the statement read.
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