Growing Allegations Against SEBI Chairperson Madhabi Puri Buch

India’s market regulator, the Securities and Exchange Board of India (SEBI), is facing a wave of serious allegations against its chairperson, Madhabi Puri Buch. Accusations related to conflict of interest and financial misconduct have emerged, questioning SEBI’s transparency and accountability.

Conflict of Interest Claims and the Adani Group Connection

The controversy began in August 2024 when US-based Hindenburg Research accused Buch and her husband of holding investments in offshore funds linked to the Adani Group. The report implied that SEBI’s slow investigation into Adani’s market manipulation and fraud was a result of this conflict of interest.

Accusations by Opposition and Corporate Figures

India’s opposition Congress party accused Buch of receiving rental income from a company she was investigating, further claiming she continued to receive financial benefits from her previous position at ICICI Bank. Subhash Chandra Goyal, chairman of Zee Entertainment, also accused her of being “corrupt” and vindictive, blaming her for the collapse of a merger deal between Zee and Sony.

Internal Discontent Within SEBI

In early September 2024, SEBI employees staged a rare protest outside the regulator’s headquarters, demanding Buch’s resignation. They alleged a toxic work culture, including public humiliation and immense pressure in meetings. Approximately 1,000 employees filed complaints with the finance ministry, exposing growing internal unrest.

SEBI’s Denial and Madhabi Puri Buch’s Defense

SEBI has publicly rejected the allegations, calling them “misplaced” and claiming that junior officers were “misguided.” Madhabi Puri Buch has denied any conflict of interest related to the Adani Group and ICICI Bank allegations. Despite her denials, she has yet to address the internal protest or accusations from Zee’s chairman.

Concerns About SEBI’s Transparency and Governance

Financial experts have raised concerns about SEBI’s credibility, urging stricter disclosure rules for senior officials at regulatory bodies. Comparisons have been drawn to global standards, where officials must divest from direct holdings that could pose conflicts of interest.

Market Impact and Investor Sentiment

Despite the controversy, India’s stock market remains one of the best-performing in the world in 2024. Global investors have invested billions into the Indian market, but experts warn that continued instability within SEBI could eventually erode investor confidence, especially if compliance concerns arise.

Speculation Over Buch’s Future as SEBI Chairperson

Madhabi Puri Buch’s term as SEBI chairperson ends in February 2025. Given the growing pressure, there is speculation that her appointment may not be renewed. Former finance secretary Subhash Garg has stated that her position has become “unsustainable,” and calls for a government or judicial investigation are increasing.

The Need for Government Action

With serious allegations mounting, experts agree that the Indian government must step in to address the issue. Global investors are closely watching how swiftly and transparently the situation is handled, as it could significantly impact future investment in the Indian market.