Informist, Monday, Aug 19, 2024
--Govt official: May form panel on Hindenburg claims against SEBI Buch
--Govt official: Panel on Hindenburg claims may include SEBI officials
By Priyasmita Dutta
NEW DELHI - The finance ministry is mulling over setting up a panel with representation from the Securities and Exchange Board of India and the government to independently look into the allegations made by Hindenburg Research against SEBI Chairperson Madhabi Puri Buch, a senior ministry official said today.
The SEBI has given a preliminary statement on the issue, but with Buch herself at the helm, it may tend to raise doubts about the credibility of the regulator, the official told Informist.
"If an allegation is made against the chairperson, even though eight other members are part of the SEBI board, a statement under her leadership does not really make sense since the issue is so sensitive," the official said, adding it was "also a matter of optics."
"Currently, domestic as well as foreign investors are looking at India as a very conducive economy to invest in... at a time like this, we (the government) cannot afford to make mistakes." The panel is likely to have representation from whole-time and part-time members of the SEBI board and government officials, the official said.
US-based short-seller Hindenburg Research had on Aug 10 alleged that Madhabi Puri Buch and her husband Dhaval Buch had stake in offshore funds that were also allegedly used by Vinod Adani, the elder brother of Adani Group Chairman Gautam Adani, to invest in Indian stocks, raising the prospect of conflict of interest in SEBI's investigation of the research firm's allegations against the Adani Group.
In a joint statement, the Buchs have denied Hindenburg Research's allegations. Buch said that all disclosures were furnished to the SEBI over the years. "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 SEBI board, headed by Buch, has four whole-time members--former managing director of State Bank of India Ashwani Bhatia, former associate professor of S.P. Jain Institute of Management & Research Ananth Narayan G., former executive director of SEBI Amarjeet Singh, and former finance ministry joint secretary Kamlesh Chandra Varshney. The four part-time members are Economic Affairs Secretary Ajay Seth, Ministry of Corporate Affairs Secretary Manoj Govil, Deputy Governor of the Reserve Bank of India Rajeshwar Rao and Professor at Indian Institute of Management V. Ravi Anshuman.
Discussions on setting up the panel are currently on, and the finance ministry is yet to finalise the constitution of the panel, the official said. From the ministry side, some officials from the economic affairs department will likely be there and if the need arises, it may also see representation from the corporate affairs ministry.
The finance ministry official, however, told Informist that though SEBI is an autonomous body, the government can recommend and advise them. Besides, the markets would like assurance from the government, so an independent analysis from the panel without SEBI Chairperson Buch will only help anchor market expectations.
Economic Affairs Secretary Seth had last week said the regulator and Buchs have already given their statements and the government has nothing further to add to those. SEBI too said that Buch had made disclosures from time to time of her "holdings in securities and their transfers."
Hindenburg Research alleged that Global Dynamic Opportunities Fund and its sub-accounts were among the foreign fund conduits used to invest promoter funds in shares of listed Adani Group entities in order to bypass the minimum public shareholding requirement of 25% for listed companies. It further said that the founder and chief investment officer of IPE Plus Fund 1, Anil Ahuja, was at that time a director of Adani Enterprises.
The Adani Group has said Hindenburg's allegations "are malicious, mischievous and manipulative selections of publicly available information to arrive at pre-determined conclusions for personal profiteering with wanton disregard for facts and the law." End
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Informist, Monday, Aug 19, 2024
--Govt official: May form panel on Hindenburg claims against SEBI Buch
--Govt official: Panel on Hindenburg claims may include SEBI officials
By Priyasmita Dutta
NEW DELHI - The finance ministry is mulling over setting up a panel with representation from the Securities and Exchange Board of India and the government to independently look into the allegations made by Hindenburg Research against SEBI Chairperson Madhabi Puri Buch, a senior ministry official said today.
The SEBI has given a preliminary statement on the issue, but with Buch herself at the helm, it may tend to raise doubts about the credibility of the regulator, the official told Informist.
"If an allegation is made against the chairperson, even though eight other members are part of the SEBI board, a statement under her leadership does not really make sense since the issue is so sensitive," the official said, adding it was "also a matter of optics."
"Currently, domestic as well as foreign investors are looking at India as a very conducive economy to invest in... at a time like this, we (the government) cannot afford to make mistakes." The panel is likely to have representation from whole-time and part-time members of the SEBI board and government officials, the official said.
US-based short-seller Hindenburg Research had on Aug 10 alleged that Madhabi Puri Buch and her husband Dhaval Buch had stake in offshore funds that were also allegedly used by Vinod Adani, the elder brother of Adani Group Chairman Gautam Adani, to invest in Indian stocks, raising the prospect of conflict of interest in SEBI's investigation of the research firm's allegations against the Adani Group.
In a joint statement, the Buchs have denied Hindenburg Research's allegations. Buch said that all disclosures were furnished to the SEBI over the years. "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 SEBI board, headed by Buch, has four whole-time members--former managing director of State Bank of India Ashwani Bhatia, former associate professor of S.P. Jain Institute of Management & Research Ananth Narayan G., former executive director of SEBI Amarjeet Singh, and former finance ministry joint secretary Kamlesh Chandra Varshney. The four part-time members are Economic Affairs Secretary Ajay Seth, Ministry of Corporate Affairs Secretary Manoj Govil, Deputy Governor of the Reserve Bank of India Rajeshwar Rao and Professor at Indian Institute of Management V. Ravi Anshuman.
Discussions on setting up the panel are currently on, and the finance ministry is yet to finalise the constitution of the panel, the official said. From the ministry side, some officials from the economic affairs department will likely be there and if the need arises, it may also see representation from the corporate affairs ministry.
The finance ministry official, however, told Informist that though SEBI is an autonomous body, the government can recommend and advise them. Besides, the markets would like assurance from the government, so an independent analysis from the panel without SEBI Chairperson Buch will only help anchor market expectations.
Economic Affairs Secretary Seth had last week said the regulator and Buchs have already given their statements and the government has nothing further to add to those. SEBI too said that Buch had made disclosures from time to time of her "holdings in securities and their transfers."
Hindenburg Research alleged that Global Dynamic Opportunities Fund and its sub-accounts were among the foreign fund conduits used to invest promoter funds in shares of listed Adani Group entities in order to bypass the minimum public shareholding requirement of 25% for listed companies. It further said that the founder and chief investment officer of IPE Plus Fund 1, Anil Ahuja, was at that time a director of Adani Enterprises.
The Adani Group has said Hindenburg's allegations "are malicious, mischievous and manipulative selections of publicly available information to arrive at pre-determined conclusions for personal profiteering with wanton disregard for facts and the law." End
Informist Media Tel +91 (11) 4220-1000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2024. All rights reserved.