Hindenburg's Allegations: Sebi Issues Statement For Investors, Check What The Market Regulator Said

Sebi has said that it has taken note of the report published by Hindenburg Research on August 10, 2024, adding that the US based short seller's report warrants an 'appropriate response'.

New Delhi: Market regulator Securities and Exchange Board of India (Sebi), has issued a statement for investors amidst the recent research report released by US-based short seller Hindenburg Research. Sebi has asked the Investors to remain calm and exercise due diligence before reacting to such reports.

"SEBI takes note of the report published by Hindenburg Research on August 10, 2024. Investors should remain calm and exercise due diligence before reacting to such reports. Investors may also like to take note of the disclaimer in the report that states that readers should assume that Hindenburg Research may have short positions in the securities covered in the report," said the market regulator.

Responding to the charges levelled against Sebi on not taking ' action against the Adani Group', the regulator said, the allegations made by Hindenburg Research, against the Adani Group, have been duly investigated by SEBI. 

"Hon’ble Supreme Court in its Order of January 3, 2024 noted that SEBI had completed twenty–two out of twenty–four investigations into the Adani group. Subsequently, one more investigation was completed in March 2024, and one remaining investigation is close to completion. During the ongoing investigation in this matter, more than 100 summons, around 1,100 letters and emails have been issued to seek information. Further, more than 100 communications have been made seeking assistance from domestic/foreign regulators and external agencies. Also more than 300 documents containing around 12,000 pages have been examined," added Sebi.

Sebi reiterated that as a matter of policy, it refrains from commenting on any investigation/ ongoing enforcement matter.

"It may be noted that pursuant to the completion of investigations, SEBI initiates enforcement proceedings which are quasi–judicial in nature. This comprises issuing of show cause notice and giving of opportunity of hearing which culminates in the passing of a speaking order. Such order is then made available in the public domain. Where investigations have been completed, enforcement proceedings initiated are ongoing and appropriate actions are being taken in accordance with the applicable securities laws," the Sebi statement said.

SEBI, said that over the years, it has built a robust regulatory framework that not only aligns with best global practices but also ensures protection of investors, adding that the regulator remains committed to ensuring the integrity of India’s Capital markets and its orderly growth and development.

Sebi Chief Madhabi Puri Buch and her husband Dhaval Buch have been named in the latest Hindenburg report (published 10 August 2024) in which the US-based short seller has alleged that the couple had stakes in in offshore funds linked to the Adani Group.

The Hindenburg latest report, citing Whistleblower Documents, said that it showed “Madhabi Buch, The Current Chairperson of SEBI, And Her Husband Had Stakes In Both Obscure Offshore Funds Used In The Adani Money Siphoning Scandal.”