New Delhi: SEBI chairman madhabi puri butch and her husband Dhaval Book on Sunday dismissed the claims Latest Hindenburg Research Report alleged that the chairman of the market regulatory body had stakes in “shadowy offshore entities that were used Adani funds misappropriation scandal”.
Issuing a point-by-point rebuttal, madhabi buch And her husband rejected the allegations of irregularities leveled against him Hindenburg And accused the US-based short-seller of “attacking” the credibility of Sebi and attempting character assassination of the head of the regulatory body, while not responding to the notice issued by the market regulator.
The full statement is here:
In reference to the allegations made against us by Hindenburg on August 10, 2024, and consistent with our commitment to full transparency, we are issuing a detailed statement as set forth below.
Some allegations have been made against SEBI, which the institution will resolve independently. We would like to resolve our issues at our individual level.
We would like to point out the following:
Issuing a point-by-point rebuttal, madhabi buch And her husband rejected the allegations of irregularities leveled against him Hindenburg And accused the US-based short-seller of “attacking” the credibility of Sebi and attempting character assassination of the head of the regulatory body, while not responding to the notice issued by the market regulator.
The full statement is here:
In reference to the allegations made against us by Hindenburg on August 10, 2024, and consistent with our commitment to full transparency, we are issuing a detailed statement as set forth below.
Some allegations have been made against SEBI, which the institution will resolve independently. We would like to resolve our issues at our individual level.
We would like to point out the following:
- Madhabi is an alumnus of IIM Ahmedabad and has had a corporate career spanning over two decades in the banking and financial services sector, primarily with the ICICI Group.
- Dhaval Buch is an IIT Delhi alumnus and has had a corporate career spanning 35 years as part of its senior management team at Hindustan Unilever Limited in India and then at Unilever globally. During this long period, Madhabi and Dhaval have earned their savings through their salaries, bonuses and stock options. The allegations about Madhabi's net worth and investments while referring to her current government salary are malicious and motivated.
- From 2010 to 2019, Dhaval lived and worked in London and Singapore – in both places he worked with Unilever.
- From 2011 to March 2017, Madhabi lived and worked in Singapore, initially as an employee of a private equity firm and later as a consultant.
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Investment The investments in the fund mentioned in the Hindenburg report were made in 2015, when they were both private citizens living in Singapore and about 2 years before Madhabi joined SEBI as a whole-time member. - The decision to invest in this fund was made because the Chief Investment Officer, Mr Anil Ahuja, is a childhood friend of Dhawal from school and IIT Delhi and had a strong investment career spanning several decades, being a former employee of Citibank, JP Morgan and 3i Group PLC. The fact that these were the drivers of the investment decision is shown by the fact that when, in 2018, Mr Ahuja left his position as the CIO of the fund, we redeemed the investment in that fund.
- As confirmed by Mr. Ahuja, at no point of time did the fund invest in any bonds, equities or any derivatives.
Adani Group Company. - Dhaval's appointment in 2019, as a senior advisor to Blackstone Private Equity, was due to his deep expertise in supply chain management. His appointment thus predates Madhabi's appointment as SEBI chairman. This appointment has since been in the public domain. Dhaval has never been associated with the real estate side of Blackstone.
- Following his appointment, the Blackstone Group was immediately added to Madhavi's disqualification list filed with SEBI.
- In the last two years, SEBI has issued over 300 circulars (including the “ease of doing business” initiative) across the market ecosystem in line with SEBI’s developmental mandate. All SEBI regulations are approved by its board (and not by its chairman) after extensive public consultation. Allegations that some of these cases relating to the REIT industry were biased towards a specific party are malicious and motivated.
- Two consulting companies set up by Madhabi while he was in Singapore, one in India and one in Singapore, became inactive soon after his appointment to SEBI. These companies (and his shareholding in them) were clearly part of his disclosures to SEBI.
- After Dhaval retired from Unilever in 2019, he started his own consultancy practice through these companies. Dhaval's deep expertise in supply chains allowed him to work with major clients in Indian industry. Thus, linking the income earned in these companies to Madhabi's current government salary is malicious.
- When the shareholding of the Singapore entity passed to Dhaval, this was once again reported not only to SEBI but also to the Singapore authorities and the Indian tax authorities.
- SEBI has strong institutional mechanisms for disclosure and disclaimer norms as per the code of conduct applicable to its officials. Accordingly, all disclosures and disclaimers have been diligently followed, including disclosure of all securities transferred or transferred subsequently.
- Hindenburg has been sent a show cause notice for a variety of violations in India. It is unfortunate that instead of responding to the show cause notice, they have chosen to attack the credibility of SEBI and attempt character assassination of the SEBI chairman.