Citing whistleblower documents, Hindenburg said Buch and her husband held stakes in an offshore fund where a substantial amount of money was invested by Vinod Adani, brother of Gautam Adani, who is chairman of the Adani group of companies.
Buch did not immediately reply to a call and a message sent on Whatsapp, said a report by Reuters.
Hindenburg’s initial report in January 2023 accused the Adani Group of engaging in various fraudulent activities, leading to a market value erosion of over $150 billion. The report prompted Sebi to investigate the group, including its offshore investments and financial practices.
Recently, SEBI issued a show-cause notice to Hindenburg, alleging that the firm colluded with a US hedge fund to profit from the report by using non-public information.
What the report says
- Hindenburg: It has been nearly 18 months since our original report on the Adani Group presented overwhelming evidence that the Indian conglomerate was operating “the largest con in corporate history”. Our report exposed a web of offshore, primarily Mauritius-based shell entities used for suspected billions of dollars of undisclosed related party transactions, undisclosed investment and stock manipulation.
- Since then, despite the evidence, along with over 40 independent media investigations corroborating and expanding on our original work, Indian securities regulator SEBI has taken no public action against the Adani Group.
- “In our July 2024 response to the ‘show cause’ notice [sent by Sebi], we wrote that we found it odd how SEBI—a regulator specifically set up to prevent fraudulent practices – showed little interest in meaningfully pursuing the parties that ran a secret offshore shell empire engaging in billions of dollars of undisclosed related party transactions through public companies while propping up its stocks through a network of sham investment entities.
- “IPE Plus Fund” is a small offshore Mauritius fund set up by an Adani director through India Infoline (IIFL), a wealth management firm with ties to the Wirecard Scandal
- Vinod Adani – brother of Gautam Adani – used this structure to invest in Indian markets with funds allegedly siphoned from over invoicing of power equipment to the Adani Group.
- The current SEBI Chairperson and her husband, Dhaval Buch, had hidden stakes in the exact same obscure offshore Bermuda and Mauritius funds, found in the same complex nested structure, used by Vinod Adani, says the Hindenburg report.
- As per Hindenburg: Madhabi Buch and her husband Dhaval Buch first appear to have opened their account with IPE Plus Fund 1 on June 5, 2015 in Singapore, per whistleblower documents.
Congress takes swipe at Centre
The Congress on Saturday used the Latin phrase “Quis Custodiet Ipsos” or “who will guard the guards themselves” to take a swipe at Sebi chief Madhabi Buch, after Hindenburg released the report.
Tagging the Hindenburg post on the allegations on X, Congress general secretary Jairam Ramesh said, “Quis Custodiet Ipsos Custodes (who will guard the guards themselves).”
In another post on the microblogging platform, Ramesh said, “Parliament was notified to sit till the evening of August 12. Suddenly it got adjourned sine die on the afternoon of August 9 itself. Now we know why.”
(With inputs from agencies)