SEBI chief Buch's earnings from consultancy firm raise regulatory concerns
Madhabi Puri Buch, the head of India's Securities and Exchange Board (SEBI), is facing scrutiny over her financial ties to a consultancy firm. During her seven-year tenure at SEBI, Buch continued to earn revenue from this firm, potentially violating rules for regulatory officials, reported Reuters based on public documents. Hindenburg Research has also raised questions about a possible conflict of interest in SEBI's investigations into the Adani Group due Buch's past investments in offshore entities linked to the conglomerate.
Buch denies conflict of interest allegations
Buch has publicly denied Hindenburg's allegations of a conflict of interest, labeling them as an attempt at "character assassination." The US-based short-seller firm highlighted two consultancy firms in its recent report - Agora Partners based in Singapore and Agora Advisory based in India. These firms are operated by Buch and her husband. Since joining SEBI in 2017, Buch has held 99% shareholding in Agora Advisory, which earned revenue of ₹3.7 crore during this period, as per documents analyzed by Reuters.
Buch's holdings could violate SEBI policy
Buch's holdings in the consultancy firm could potentially violate a 2008 SEBI policy. This policy forbids officials from holding an office of profit or receiving salary or professional fees from other professional activities. In response to these concerns, Buch stated that her involvement with the consultancy firms was revealed to SEBI and that her husband used these firms for his consulting business after retiring from Unilever in 2019.
Buch's continued business operations viewed as 'serious' breach
Subhash Chandra Garg, a former top bureaucrat in the Indian government and a SEBI board member during Buch's tenure, described her equity in the firm and its continued business operations as a "very serious" breach of conduct. He stated, "There was no justification for her to continue to own the firm after she joined the board." This criticism comes despite Hindenburg Research noting that Buch transferred all her shares in Agora Partners to her husband in March 2022.
Calls for Buch's resignation amid controversy
The controversy surrounding Buch's financial ties has led to calls for her resignation, including from opposition leaders. A spokesperson for the ruling Bharatiya Janata Party (BJP) dismissed these demands as a baseless attack. Garg and another SEBI board member claimed that no disclosures were made by Buch or any other officials to the board about their business interests during her tenure.
