Rahul Gandhi warns of stock market risk after new Hindenburg report on SEBI chief: ‘Umpire is compromised’
SEBI Chairman Buch and her husband have denied the allegations as baseless and asserted their finances are an open book.
Leader of Opposition in the Lok Sabha, Rahul Gandhi, on Sunday issued a stark warning regarding the integrity of India's stock market following the latest allegations made by U.S.-based short-seller Hindenburg Research.
In a video statement, Gandhi expressed serious concerns about the potential conflict of interest involving the head of India's market regulator, the Securities and Exchange Board of India (SEBI).
"It is my duty as Leader of Opposition to bring to your notice that there is a significant risk in the Indian stock market because the institutions that govern the stock market are compromised," Gandhi said, referring to the Hindenburg report, which accused SEBI chief Madhabi Puri Buch of having had stakes in one of the offshore funds allegedly used by the Adani Group for illegal share ownership and price manipulation.
The Hindenburg report, released on Saturday, claims that Buch and her husband, Dhaval Buch, held investments in a sub-fund of the Bermuda-based Global Opportunities Fund. This fund, according to the report, was linked to the Adani Group’s stock trading activities.
The report alleges that Dhaval Buch became the sole operator of the account in 2017, just before Madhabi Puri Buch joined SEBI.
"This is an explosive allegation because it alleges that the umpire herself is compromised," Gandhi said, referring to Buch’s role as the chairperson of SEBI.
“Why hasn’t SEBI chairperson Madhabi Puri Buch resigned yet?” Gandhi said.
"If investors lose their hard-earned money, who will be held accountable – PM Modi, the SEBI Chairperson, or Gautam Adani?" he asked, calling for immediate action.
Gandhi also urged the Supreme Court to revisit the case against Adani Group, suggesting that the new allegations necessitate further investigation.
"New and very serious allegations have surfaced. Will the Supreme Court look into this matter suo moto once again? It is now abundantly clear why Prime Minister Modi is against the Joint Parliamentary Committee (JPC) looking into this matter," he added.
The Adani Group has categorically denied the allegations, describing them as "no more than red herrings thrown by a desperate entity with total contempt for Indian laws."
SEBI has also responded, with Madhabi Puri Buch dismissing the allegations as baseless and reiterating that all necessary disclosures were made before her appointment as SEBI chairperson.