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The Congress party has leveled fresh accusations against Madhabi Puri Buch, the Chairperson of the Securities and Exchange Board of India (SEBI), alleging she received rental income from an associate firm of Wockhardt Ltd while SEBI was investigating the drugmaker for insider trading. The opposition party claims Buch earned approximately ₹2.17 crore between fiscal years 2018-19 and 2023-24 from Carol Info Services Ltd, a subsidiary of Khorakiwala Holdings and Investments Pvt. Ltd, with Wockhardt Hospitals Ltd as an associate company.
The allegations, if proven, place Buch in potential violation of SEBI's regulations and raise concerns about conflict of interest. The Congress states that Wockhardt, a regulated entity, was under investigation by SEBI in 2023 for various cases, including insider trading. The party argues this constitutes a “case of corruption that invokes conflict of interest violating Section 4, 7, and 8 of Sebi’s 2008 Code on Conflict of Interests for members of (Sebi) board”.
According to sources, Buch rented office space in South Mumbai's Mahalakshmi racecourse locality to Carol Info Services. The property, located near the Sri BasavWockhardt Hospital, is reportedly co-owned by Buch's husband, Dhaval Buch, who holds a 37% stake. SEBI and Wockhardt have not responded to requests for comment.
The Congress's allegations are the latest in a series of controversies surrounding Buch. Previously, the party accused Buch of receiving a salary from her former employer, ICICI Bank Ltd, and its subsidiary, ICICI Prudential AMC, after retiring in 2013 and joining SEBI. ICICI Bank refuted these claims in an exchange notice, stating that Buch received only her retirement benefits. Subsequent reporting revealed that Buch's tenure at ICICI Bank between 2011 and 2013 coincided with a full-time position at Greater Pacific Capital, raising questions about her ability to work for two financial services firms simultaneously.
The Congress has highlighted the actions of previous SEBI chairpersons in handling potential conflicts of interest. They point to M. Damodaran, who sold his shares in State Bank of India upon assuming the chairmanship of UTI in 2001, and C.B. Bhave, who recused himself from matters involving National Securities Depository Limited (NSDL) due to his previous role as chairman. In contrast, the Congress criticizes Buch for simply transferring her investments to her spouse, raising concerns about credibility.
SEBI's code of conduct for members, including the chairperson, requires them to take steps to ensure that conflicts of interest do not affect board decisions. Members are obligated to disclose any potential conflicts and avoid exploiting personal or professional relationships with regulated entities to their advantage. The latest allegations against Buch have intensified scrutiny of her leadership and the perceived ethical challenges she faces within SEBI.
Source: Buch allegedly earned rent from Wockhardt firm while Sebi was probing the drugmaker