Hindenburg Report Corruption Allegations: Lokpal clean chits Ex-SEBI Chief Madhabi Puri Buch

India’s anti-corruption ombudsman, the Lokpal, has dismissed three separate complaints that sought an inquiry into former Securities and Exchange Board of India (SEBI) chairperson Madhabi Puri Buch, ruling that the charges “lack any verifiable material” and are “untenable, unsubstantiated and bordering on frivolity.” The six-member bench, headed by Lokpal chairperson Justice A.M. Khanwilkar, delivered its 94-page combined order late Wednesday, definitively closing a year-long controversy that stemmed from allegations amplified after the January 2023 Hindenburg Research report on the Adani Group.

The Lokpal was examining three complaints filed by Trinamool Congress MP Mahua Moitra and two other individuals. They accused Buch of conflicts of interest, market misconduct and personal enrichment during her stint as SEBI chief. Specific claims ranged from trading in ICICI Bank employee stock options while in office to profiting through her private consultancy firm and shielding offshore investments allegedly linked to Adani-connected funds.

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The bench clustered the accusations into five heads: (1) passive stakes in a Mauritius vehicle said to funnel money into Adani stocks; (2) consultancy fees purportedly received from Mahindra & Mahindra and Blackstone for favourable regulatory treatment; (3) rental income from Wockhardt that complainants portrayed as quid pro quo; (4) gains from selling ICICI Bank ESOPs between 2017-24; and (5) an alleged sham “recusal” from board matters involving former clients. After tracing fund flows, affidavits and disclosure records, the Lokpal found “no substance in any of the claims.”

Buch first replied to the Lokpal’s notice on 8 November 2024 and filed a detailed sworn affidavit on 7 December 2024. Oral arguments followed on 19 December 2024 and 9 April 2025, with both sides granted time for supplementary written submissions. The order notes that one complainant did not appear for rebuttal, while Buch was represented by senior counsel who produced transaction statements and conflict-of-interest logs from SEBI.

Citing Sections 14 & 46 of the Lokpal and Lokayuktas Act, 2013, the bench held that the petitions rested on “presumptions and assumptions” and therefore failed the prima-facie threshold for a Prevention of Corruption Act probe. It warned that the attempt to “sensationalise or politicise the matter” verged on abuse of process and could itself invite action for vexatious proceedings.

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On the most widely-discussed charge—that Buch and her husband invested in GDOF Cell 90/IPE Plus Fund, a vehicle allegedly funnelling money into Adani scrips—the Lokpal accepted documentary proof that the couple had fully redeemed their units in 2018, four years before SEBI began the Adani investigation, and that the fund never routed investments through the two offshore entities named by Hindenburg. The order also emphasised that Buch was a “passive investor with no control over portfolio decisions.”

In a joint statement issued after the verdict, Madhabi Puri Buch and her husband Dhaval Buch welcomed the ruling, calling the complaints “baseless character assassination.” They reiterated that all their financial dealings were “fully disclosed and above board,” and said the decision vindicated the reforms undertaken at SEBI under her tenure.

At the time of filing this report, Mahua Moitra had not issued a fresh comment. The Lokpal, however, recorded that the complainants’ “unverified and flimsy” allegations had “trivialised” the statutory process, hinting that cost or penalty proceedings under Section 46 could follow if similar petitions are filed without evidence.

A former ICICI Bank executive and the first woman to head India’s market watchdog, Buch took office on 2 March 2022 and completed her term on 28 February 2025. During that period she oversaw landmark reforms, including the adoption of shorter trade-settlement cycles and tighter IPO disclosure norms. Her exit coincided with an unprecedented public-markets scrutiny triggered by the Hindenburg-Adani episode, leaving SEBI’s handling of offshore funds in the spotlight.

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The Lokpal’s decision lifts a potential cloud over recent SEBI enforcement actions and underscores the high evidentiary bar for graft probes against senior regulators. The clean chit removes an overhang just as the finance ministry is finalising Buch’s successor and SEBI prepares to roll out fractional-share trading norms. While the Lokpal order can be challenged in the Delhi High Court, practitioners believe the scathing language on “frivolity” makes a successful appeal unlikely.

The Lokpal Coram also noted that, “This reverse engineering of allegations explains why the complainants have been unable to demonstrate even a basic prima facie case that any favour was granted to any company. Routine SEBI decisions have been recast as part of an

alleged grand conspiracy involving not only RPS but also the entire SEBI Board, its Whole Time Members, the High Powered Committee on Settlements (chaired by a retired High Court judge), the Takeover Panel (also chaired by a retired High Court judge), and dozens of SEBI officers. To ask for a corruption probe into all of these individuals based on speculative claims of "influence", with not a shred of evidence of any wrongdoing is plainly unjustified and solely politically motivated.”

To Read the full text of the Order CLICK HERE

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