Instead of SEBI or Madhabi Buch, Govt Should’ve Responded to Hindenburg: Former SEBI Chairman

Instead of SEBI or Madhabi Buch, government should have responded to Hindenburg allegations: former Chairman of SEBI, Chandrasekhar Bhaskar Bhave, to Karan Thapar for The Wire.

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A former Chairman of SEBI, commenting for the first time on the recent Hindenburg allegations, says that the response should not have come from SEBI or even from its Chairperson, Madhabi Puri Buch, but from the Government of India i.e. the Ministry of Finance. Chandrasekhar Bhaskar Bhave says that since SEBI and its Chairperson face serious allegations they cannot really respond and clarify their own situation. It won’t carry conviction or credibility. Instead, Mr. Bhave says, the Chairperson should have made available to the government details of all her disclosures as well as recusals and the government should then have responded as it thinks fit.



In a lengthy 35-minute interview to Karan Thapar for The Wire, which is often arguementative and perhaps even quarrelsome, Mr. Bhave was also asked about how SEBI has handled the Hindenburg allegations since they first became public 19-20 months ago in January 2023. He said if all the assumptions in the public domain about disclosures or non-disclosures and about recusals and non-recusals are correct “it wasn’t handled properly”.



I will stop there. I do not wish to convey the wrong impression by a precis or paraphrase of Mr. Bhave’s answers. As a former Chairman of SEBI you should hear his answers to a whole range of questions yourself.



However, I will point out that the recent Reuters story alleging that Madhabi Buch “continued to earn revenue from a consultancy firm during her tenure” as Chairperson of SEBI is raised at some length with Mr. Bhave. There’s a particularly arguementative/quarrelsome section, which is part of this discussion, over whether the 2008 SEBI policy which “bars officials from … receiving … professional fees from other professional activities” applies to Madhabi Buch or not. Again, I will leave you to watch the interview to get the details.



A former Finance Secretary, Subhash Garg, has told Reuters that the 2008 policy does apply and he, therefore, calls Madhabi Buch’s conduct a “very serious” breach which makes “her position untenable at the regulator”. You must see and hear for yourself what conclusion Mr. Bhave comes to or suggests by his answers to this matter.



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