Congress party has called for immediate action to eliminate conflicts of interest in the investigation into the Adani Group, following allegations against Sebi chairperson Madhabi Buch by US short-seller Hindenburg Research.

The Congress party has demanded that the Centre take swift action to address the allegations, which it says raise questions about the regulator's impartiality. The party has also called for a Joint Parliamentary Committee (JPC) to investigate the full scope of the alleged scam, citing "seeming complicity of the highest officials of the land".

In a post on X, Congress general secretary in-charge communications Jairam Ramesh suspected the reason behind adjourning the  Parliament two days ahead of the scheduled date. "Parliament was notified to sit till the evening of August 12th. Suddenly it got adjourned sine die on the afternoon of Aug 9th itself. Now we know why," he wrote.

Hindenburg New Report On SEBI Chief

The Hindenburg Research on Saturday launched a fresh broadside against market regulator Sebi chairperson Madhabi Buch, alleging she and her husband had stakes in obscure offshore funds used in the Adani money siphoning scandal.

In a blogpost, Hindenburg said 18 months since its damning report on Adani, "SEBI has shown a surprising lack of interest in Adani's alleged undisclosed web of Mauritius and offshore shell entities."

Sebi has denied the allegations, with Madhabi Buch and her husband issuing a statement saying they "strongly deny the baseless allegations and insinuations".

The statement added that they would disclose all financial documents to any authority seeking them, and would issue a detailed statement in due course.

Congress Statement On Hindenburg allegations

In a statement on the development, Jairam Ramesh said that the Sebi's "strange reluctance to investigate the Adani mega scam" has been long noted, not least by the Supreme Court's Expert Committee.

The Committee, he said, had noted that SEBI in 2018 diluted and in 2019, entirely deleted the reporting requirements relating to the ultimate beneficial (i.e. actual) ownership of foreign funds.

"This had tied its hands to the extent that 'the securities market regulator suspects wrongdoing, but also finds compliance with various stipulations in attendant regulations... It is this dichotomy that has led to SEBI drawing a blank worldwide'," Ramesh said quoting the Expert Committee.

The politician added, "Under public pressure, after the Adani horse had bolted, SEBI's board reintroduced stricter reporting rules on 28 June 2023. It told the Expert Committee on 25 August 2023 that it was investigating 13 suspicious transactions. Yet the investigations never bore fruit."

He said that the the Hindenburg Research's Saturday revelations show that Buch and her husband invested in the same Bermuda and Mauritius-based offshore funds in which "Vinod Adani and his close associates Chang Chung-Ling and Nasser Ali Shahban Ahli invested funds earned from the over-invoicing of power equipment."

"These funds are believed also to have been used to amass large stakes in Adani Group companies in violation of SEBI regulations. It is shocking that Buch would have a financial stake in these same funds," Ramesh said.

The Congress leader said that the revelation raised fresh questions about Gautam Adani's two 2022 meetings in quick succession with Buch, shortly after she became the stock market regulator's chairperson.

"The government must act immediately to eliminate all conflicts of interest in the SEBI investigation of Adani. The fact is that the seeming complicity of the highest officials of the land can only be resolved by setting up a JPC (joint parliamentary committee) to investigate the full scope of the Adani mega scam," the former Union minister said in his statement.

Earlier, tagging the Hindenburg post on the allegations on X, Ramesh said, "Quis Custodiet Ipsos Custodes (who will guard the guards themselves)."

(With PTI Inputs)