Who is SEBI chief Madhabi Puri Buch and what are her options now?

When ICICI Bank veteran Madhabi Puri Buch was appointed to head SEBI (the Securities and Exchange Board of India) in 2022, she became its first woman and the first non-IAS chief since 2002, and the very first from the private sector. Buch has also been the first and the only woman so far to serve as a whole-time member of SEBI. She was also the youngest SEBI head ever, at the age of 56, in 2022.

Her four-year stint as whole-time member and in-charge of the funds and surveillance divisions at SEBI would allow her to hit the ground running, it was thought, at a time when market sentiments were already choppy. She was expected to calm investors’ nerves and ensure good corporate governance at SEBI.

A graduate of St Stephen’s College and an MBA from IIM Ahmedabad, Buch started her 20-year stint with ICICI as a project finance analyst, continuing till 1992. She re-joined the private lender in 1997 and rose through the ranks to become an executive director in 2006—part of the team that included Chanda Kocchar, led by then-chief executive K.V. Kamath.

Buch then served as the CEO of ICICI Securities, the broking and investment banking arm of the ICICI Group, between 2009 and 2011. When she left in 2011, she was stepping down from the roles of both managing director and chief executive of ICICI Securities.

On the SEBI side, in April 2002, G.N. Bajpai, the former chairman of LIC, was named chairman. His term ended in February 2005. Since then, all four who have occupied the corner office at SEBI — M. Damodaran, C.B. Bhave, U.K. Sinha and Ajay Tyagi — were from the Indian Administrative Services (IAS) cadre.

One of them has, since demitting office, joined the board of an Adani group company. To add to that irony, the new Hindenburg report released on Saturday, 10 August, has now accused Madhabi Puri Buch of having a stake in offshore funds used by Gautam Adani's controversial Dubai-based brother Vinod — and hiding it.

If Puri Buch had disclosed her stakes and investment in the Bermuda- and Mauritius-based funds, it is argued, she should have disclosed her conflict of interest and recused herself from the Supreme Court-ordained inquiry into allegations against the Adani Group by Hindenburg Research in January 2023.

Before she came to head SEBI in 2022, during her tenure as whole-time member (since 2017) — a position just below the chairman already — SEBI is accused of first diluting and then deleting more stringent rules for offshore funds in 2018 and 2019. Some of these provisions were restored in 2023, media reports had suggested.

The latest Hindenburg report has again put the government in the dock.

Pressure is likely to mount for Modi to pursue an inquiry by a joint parliamentary committee, given the government’s own central agencies like the CBI and the Enforcement Directorate have been so inept that they failed to raise even a red flag in all this. Revenue Intelligence also drew a blank, apparently.

The question now is whether Madhabi Puri Buch will resign and face the heat, or will she dig her heels in.

All eyes peeled, the next Act is about to begin.