New Delhi, Aug 11 (UNI) Even as SEBI Chairperson Madhabi Puri Buch denied any involvement in the alleged money laundering case as mentioned in the new Hindenburg report, the market regulator has issued a statement asking investors to remain “calm” and exercise “due diligence” before reacting to such reports.



Hindenburg Research published a new report on Saturday wherein it alleged Security and Exchange Board of India (Sebi) chief held a stake in obscure offshore entities used in alleged Adani money laundering case, allegations outrightly rejected by the Buch.



“It is emphasized that SEBI has adequate internal mechanisms for addressing issues relating to conflict of interest, which include disclosure framework and provision for recusal. It is noted that relevant disclosures required in terms of holdings of securities and their transfers have been made by the Chairperson from time to time,” SEBI said in a statement.



The SEBI Chairperson has also recused herself in matters involving potential conflicts of interest. SEBI, over the years, has built a robust regulatory framework that not only aligns with best global practices but also ensures protection of investors. SEBI remains committed to ensuring the integrity of India’s Capital markets and its orderly growth and development.



“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,” SEBI said in a report.



The report inter alia claims that SEBI has not taken any action against the Adani Group. It questions SEBI’s action of issuing a show cause notice to Hindenburg Research on June 27, 2024.



It further claims that SEBI has made changes to the SEBI (REIT) Regulations 2014, in order to benefit a diversified multinational financial conglomerate. These issues warrant an appropriate response, the market regulator said.



Notably, 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.



Earlier during the day, Adani group also issued a statement and rubbished the accusations made against it while calling them “malicious and mischievous”.



"The latest allegations by Hindenburg are malicious, mischievous and manipulative selections of publicly available information to arrive at pre-determined conclusions for personal profiteering with wanton disregard for facts and the law. We completely reject these allegations against the Adani Group which are a recycling of discredited claims that have been thoroughly investigated, proven to be baseless and already dismissed by the Hon'ble Supreme Court in March 2023,"Adani Group said in a stock exchange filing.



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, the SEBI statement added.



Also more than 300 documents containing around 12,000 pages have been examined. 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.



SEBI, as a matter of policy, refrains from commenting on any investigation/ongoing enforcement matter. The report also seeks to question SEBI’s action in issuing a show cause notice to Hindenburg Research, on June 27, 2024.



The show cause notice in question, alleging violations of securities laws by Hindenburg Research, has been issued by following the due process of the law. It is noted that Hindenburg Research has itself made the show cause notice issued to it available on its website.



The show cause notice contains the reasons for its issuance. The proceedings in this matter are ongoing and the same is being dealt with in accordance with the established procedure and in compliance with the principles of natural justice.



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



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