Congress alleges conflict of interest over Sebi chief Buch’s rental income
Source: Business Standard
Securities and Exchange Board of India (SEBI) chairperson Madhabi Puri Buch (File Photo: PTI)
The Congress party on Friday levelled fresh allegations against Madhabi Puri Buch, chairperson of the Securities and Exchange Board of India (Sebi), citing her rental income as a conflict of interest.
The opposition alleged that Buch received rental income from an entity affiliated with the pharmaceutical company Wockhardt—which Sebi was investigating for various cases, including insider trading.
Buch earned a total rental income of Rs 2.16 crore from Carol Info Services in the last six financial years—between FY19 and FY24. Buch was a whole-time member with Sebi between April 2017 and October 2021 and took charge as the chief in March 2022.
“Previous Sebi chairpersons have gone to great lengths to avoid even the appearance of a conflict of interest, both in their roles at Sebi and in their previous positions… In contrast, Ms Buch merely transferred her investments to her spouse, which raises concerns about credibility,” said Congress.
Shares of Wockhardt hit a lower circuit of 5 per cent, closing at Rs 1,035 apiece on Friday amidst the allegations against Buch.
The four orders cited by Congress, including two settlement orders mentioned by the Congress, are between March 2023 and July 2023.
One of the settlement orders was finalised before Buch took charge as the Sebi chair, with a payment of Rs 27 lakh made by Wockhardt in February 2023 to Sebi as recommended by a high-powered advisory committee of the market regulator.
The second settlement order was issued in May 2023, where Wockhardt paid Rs 36.7 lakh as a settlement amount.
However, two of the orders are on the same matter—one by an adjudicating officer and the other the final order, in a gap of one month. Wockhardt was not a noticee in either of the two orders, a reading of the orders shows.
Sebi had ordered disgorgement of Rs 14.23 lakh along with 4 per cent interest for the previous 10 years on a former executive of Wockhardt for flouting insider trading norms. In the order dated July 31, 2023, the executive was further debarred from the securities market.
“Was her appointment cleared on the condition that she could maintain her previous financial relationships, provided she acted in line with the wishes of the Prime Minister and his close associates?” questioned Congress.
This is the third attack from the opposition on the Sebi chief in the series of ‘revelations’ on her income and alleged associations.
Earlier this week, Congress raised questions on the alleged payments and ESOPs to Buch from ICICI Bank, both in terms of the amount and the frequency of payouts.
ICICI Bank had refuted the claims, saying Buch was not paid any salary or granted any ESOP after her retirement in October 2013.
The bank had added that its employees had the choice to exercise their ESOPs anytime up to a period of 10 years from the date of vesting.
Buch has also found herself in the eye of a storm this week with allegations of conflict of interest from Congress, accusations of ‘corruption’ by Zee Entertainment promoter Subhash Chandra (who is being probed for diversion of funds), and unrest from the employees at Sebi.
First Published: Sep 06 2024 | 5:26 PM IST
