"Significant risk in Indian stock market after integrity of SEBI gravely compromised": Rahul Gandhi on Hindenburg report

New Delhi [India], August 11 : Leader of Opposition in the Lok Sabha Rahul Gandhi, alleged on Sunday that there was a significant risk in the Indian stock market after the "integrity" of the Securities and Exchange Board of India (SEBI) was "gravely compromised" by the allegations against its chairperson.
The Congress leader also asked, "If investors lose their hard-earned money, who will be held accountable--PM Modi, the SEBI Chairperson, or Gautam Adani?"
His statement came a day after US-based short seller Hindenburg Research alleged that market regulator SEBI chairperson Madhabi Buch and her husband had stakes in obscure offshore funds used in the alleged Adani money siphoning scandal.
Taking to his official handle on X, Rahul Gandhi posted, "The integrity of SEBI, the securities regulator entrusted with safeguarding the wealth of small retail investors, has been gravely compromised by the allegations against its Chairperson."
Rahul Gandhi also questioned why SEBI Chairperson Madhabi Buch has not yet resigned, demanding an answer from the government.
"In light of the new and very serious allegations that have surfaced, will the Supreme Court look into this matter suo moto once again? It is now abundantly clear why Prime Minister Modi is so afraid of a Joint Parliamentary Committee (JPC) probe and what it might reveal," read his post.
In a self-made video message, Rahul Gandhi said, "Imagine you're watching an international cricket match between India and Australia and every single person who is watching the match and those playing the match know that the umpire is compromised. What would happen to the match, what would happen to the fairness of the match and the outcomes? How would you feel as somebody who is participating in the match?"
"This is exactly what is happening in the Indian Stock Market. Over the last few years, larger and larger numbers of people have been investing in the Indian Stock market. They invest their hard-earned, honestly earned money in the Indian Stock Market," he said.
"It is my duty as Leader of the Opposition to bring to your notice that there is a significant risk in the Indian stock market because the institutions that govern the stock market are compromised. A very serious allegation against the Adani group was illegal share ownership and price manipulation using offshore funds," he said.
Adding further, he said, "It has now emerged that SEBI chairwoman Madhabi Buch and her husband had an interest in one of those funds. This is an explosive allegation because it alleges that the umpire herself is compromised."
"The savings of millions of Indians, honestly earned savings are at risk. It is therefore imperative that this matter is investigated," stated Gandhi.
Meanwhile, SEBI Chairperson Madhabi Buch and her husbands through a press release rejected the allegations of Hindenburg as baseless and malicious and said this was done for their "character assassination."
In the joint statement released to the media, they said, "Our life and finances are an open book. All disclosures as required have already been furnished to SEBI over the years. We have no hesitation in disclosing any and all financial documents, including those that relate to the period when we were strictly private citizens, to any and every authority that may seek them. 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."
On August 10, Hindenburg published a report alleging, "We had previously noted Adani's total confidence in continuing to operate without the risk of serious regulatory intervention, suggesting that this may be explained through Adani's relationship with SEBI Chairperson, Madhabi Buch."
"What we hadn't realized: 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," the report by the US hedge firm alleged.
Earlier in January 2023, Hindenburg published a report accusing the Adani Group of financial irregularities, leading to a significant drop in the group's stock prices. Adani had rubbished these claims as baseless.
The Supreme Court has given a clean chit to the Adani group. In January 2024, the apex court refused to transfer the probe into the allegations made by Hindenburg of stock price manipulation by the Adani group to an SIT and directed market regulator SEBI to complete its probe into two pending cases within three months.
In June this year, the Supreme Court also dismissed a plea seeking to review its earlier verdict in the Adani-Hindenburg case.