US-based short seller Hindenburg Research has alleged that Madhabi Buch, Chairperson of the Securities and Exchange Board of India (SEBI), held stakes in offshore entities implicated in the Adani money siphoning scandal.

What Happened: The research firm alleges that Madhabi Buch and her husband, Dhaval Buch, had hidden stakes in the same offshore funds used by Vinod Adani, brother of Gautam Adani. The report suggests that SEBI’s lack of action against the Adani Group, despite evidence of fraudulent practices, could be due to Buch’s involvement in these funds.

The research firm based its allegations on whistleblower documents, which purportedly show the Buchs’ investments in the Global Dynamic Opportunities Fund and the IPE Plus Fund 1. These funds are registered in Bermuda and Mauritius, respectively, and are known tax havens.

The report highlighted that despite the availability of thousands of reputable onshore Indian mutual funds, SEBI Chairperson Buch and her husband held stakes in a complex offshore fund structure with minimal assets, operating through high-risk jurisdictions.

“Madhabi Buch and her husband had stakes in a multi-layered offshore fund structure with minuscule assets, traversing known high-risk jurisdictions, overseen by a company with reported ties to the Wirecard scandal, in the same entity run by an Adani director and significantly used by Vinod Adani in the alleged Adani cash siphoning scandal,” the report added.

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The report explained that IPE Plus Fund is a small offshore fund based in Mauritius, established by a director associated with the Adani Group through India Infoline (IIFL), a wealth management firm with connections to the Wirecard scandal. Vinod Adani allegedly used this fund to invest in Indian markets. These investments are believed to be financed with funds obtained through the over-invoicing of power equipment by the Adani Group.

The report also alleges that Madhabi Buch transferred her stake in Agora Partners, a Singaporean consulting entity, to her husband ahead of her politically sensitive appointment as SEBI Chairperson.

Hindenburg Research has called for further investigation into these allegations. The firm has pledged to donate any proceeds derived from the report to causes that support free expression.

This is not the first time Hindenburg Research has been involved in controversies related to the Adani Group. In July 2024, the firm received a “show cause” notice from SEBI related to shorting Adani stock, which Hindenburg termed as an attempt to ‘silence and intimidate’ them. The notice highlighted Hindenburg’s concentration in short-selling activity in the derivatives of Adani Enterprises ahead of the release of a scathing report accusing Gautam Adani of “pulling the biggest con in corporate history.”

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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.