(Bloomberg) -- India’s political opposition is calling on the head of the nation’s stock-market regulator to resign after Hindenburg Research alleged impropriety in its investigation against the Adani Group.
In a report published Saturday, the US short seller accused the Securities and Exchange Board of India chairperson Madhabi Puri Buch and her husband Dhaval Buch of investing in offshore entities which were allegedly part of a fund structure related to Adani. The investments were made in 2015, two years before Buch joined Sebi as a full-time member, the report said. Buch denied any wrongdoing.
“Her guilt is there for everyone to see,” Mahua Moitra, a lawmaker in India’s parliament from the All India Trinamool Congress party, told Bloomberg TV. “India’s reputation as a global market investment is at stake. We cannot be seen to be non-transparent, we cannot be seen to be opaque, we cannot be seen to be slow, we have to take quick action and clean up the system.”
Rahul Gandhi, leader of opposition from the Congress party, said in a statement Sunday that the integrity of Sebi had been “gravely compromised by the allegations against its chairperson.”
Gandhi and Moitra have been fierce critics of billionaire Gautam Adani and his closeness to Prime Minister Narendra Modi. Moitra was expelled last year from parliament for sharing sensitive information from her official parliamentary account. On her way out, Moitra claimed that her critique of Adani and his dealings were a reason behind her expulsion. She was re-elected in June.
The Adani Group has labeled the latest allegations by Hindenburg as “malicious”, and said it has “absolutely no commercial relationship with the individuals or matters mentioned in this calculated deliberate effort to malign our standing.”
Adani Group stocks fell with flagship Adani Enterprises sliding as much as 5.5% in Mumbai.
The opposition is demanding a parliamentary investigation into the allegations made by the US short seller and are also hoping for direct intervention from the country’s top court to re-open its earlier investigation.
--With assistance from Paul Allen.
(Updates with Adani share price and Moitra’s video. A previous version of the story was corrected to say Buch joined Sebi in 2017 as a full-time member)
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