Against the backdrop of US-based short seller Hindenburg Research alleging that Sebi Chairperson Madhabi Puri Buch and her husband Dhaval Buch previously held investments in offshore funds also used by the Adani group—charges categorically denied by the couple—experts are debating whether the capital market regulator is competent to conduct such a probe. 

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According to senior market analyst Hemindra Hazari, it is "regrettable" that any investigation by Sebi takes so long to close, and this has been going on for many years. It is only after the Supreme Court's intervention that certain timelines were given to the regulator to investigate allegations about Adani, he told WION.

"Now if your investigation takes so long, the question is that, is the regulator competent enough to get all the details or not?" 

"And why should it be taking so long? These things should be done quickly and should be resolved quickly," he said.

The analyst also noted that there are three basic issues in this:

  • Are the documents pertaining to Madhvi Buch's investments and her husband's authentic?
  • Did Buch make the necessary disclosures to Sebi and to the government of India and to the Supreme Court of India?
  • Did she recuse herself from the Adani investigations?

Economist and author Prof Vikas Singh said the Adani-Hindenburg saga has highlighted critical gaps in corporate governance and regulatory oversight. "India must expedite investigations, ensuring transparency and accountability," Singh said, highlighting that the Hindenburg-Adani saga has intensified scrutiny on Sebi's role as the country's capital market regulator. 

"Allegations of lax oversight and potential conflicts of interest have eroded public trust in the regulator. While SEBI has initiated investigations, restoring credibility and ensuring investor protection are paramount," Singh told WION. "The episode underscores the need for a robust regulatory framework and transparent governance within market watchdogs."

Several foreign investors has raised concerns regarding the latest Hindenburg report, which contains several allegations against the Sebi chief and her husband.

Eminent market expert Mark Matthews said that he will see what the Supreme Court has to say on the matter. "I cannot see any evidence to support impropriety" in those accusations, he said. 

Earlier, veteran investor Marc Faber said that if the allegations are true, the people involved should resign. Read more  

ALSO READ: Hindenburg attacking Sebi credibility, indulging in character assassination attempt of its chairperson, say Buchs 

Madhabi Puri Buch and her husband Dhaval Buch released a second, more detailed statement on Sunday, categorically denying the charges levelled by the US short seller, and sharing a host of specific details including their career history, education and certain investments. 

However, responding to the 15-point statement issued by the Buchs, Hindenburg took to microblogging site X (formerly Twitter) to say that their responses include "several important admissions” and raise “numerous new critical questions".  Read more 

On Saturday, the US-based firm alleged, citing whistleblower documents, that Madhabi Puri Buch and Dhaval Buch held stakes in an offshore fund where a substantial amount of money was invested by associates of Vinod Adani, brother of Adani group chairman Gautam Adani.

Meanwhile, capital market regulator Sebi asked investors to remain calm and exercise due diligence before reacting to such reports. 

Mutual fund industry body AMFI also came in support of the Sebi chairperson, saying that the US short-seller is trying to create a trust deficit in the market ecosystem. AMFI said that external comments on the markets regulator's Chairperson "not only attempt to undermine Madhabi Buch's contribution to the Indian capital market, but it also undermines our country's economic progress, and creating a trust deficit in the market ecosystem must be seen for what they truly are -- attempts to create sensation by connecting random events done in the past".

With inputs from agencies