Madhabi Puri Buch in Trouble? Employees' Letter Adds to SEBI Chief's Woes as Opposition Mounts Pressure

The Securities and Exchange Board of India (SEBI) officials in an unprecedented complaint to the finance ministry accused the leadership of facilitating a toxic work culture.

"Shouting, scolding and public humiliation have become a norm in meetings," said the August 6 letter, according to a report by the Economic Times. The publication said it reviewed the letter.

In response to ET’s queries on September 1, SEBI said matters with employees were resolved. "The issues referred to in your mail have already been addressed by SEBI. Engagement with employees for resolution of their issues is a continuous process," the market watchdog was cited as saying in an email.

The officials complained in the letter – titled ‘Grievances of SEBI Officers – A Call for Respect’ – that the leadership uses “harsh and unprofessional language” toward team members, monitors their “minute-by-minute movement” and imposes “unrealistic work targets with changing goal posts”. This has impacted mental health and thrown work-life balance out of gear, the officials said in the letter to the finance ministry.

SEBI has around 1,000 Grade A and above officers (assistant managers and above) and half of them, around 500, signed the letter, according to the ET report. The officials raised the issue with the finance ministry after their complaints to the management went unheard.

As per the report, the “core for their grievance” is the leadership “calling names” and “shouting” at them. "Unprofessional language is casually used by people at the highest level," ET cited SEBI officials as saying, complaining of an oppressive atmosphere.

Read More | What Happened to Adani After Hindenburg 2.0? Nearly Nothing

Several people, including those in higher grades, have chosen not to express their concerns vocally for fear of the vindictive nature of people at the highest level.

However, SEBI said the changes have been made. "In respect of the work environment, the format of review meetings has been changed. Hence, issues (with regard to) meetings stand addressed," SEBI told ET. The regulator informed that two employee bodies acknowledged the changes through emails on September 3.

In the last one month, the SEBI chief has faced a slew of allegations against her by various parties.

Recent Allegations

The report comes at a time when SEBI chief Madhabi Puri Buch is facing accusations of conflict of interest over the regulator’s Adani investigation. The Congress has raised questions over compensation paid to her by former employer ICICI Bank. In addition, Zee Group founder Subhash Chandra accused Buch of corruption on Tuesday.  

Chandra labelled serious allegations against Buch that she is responsible for the failure of the ZEEL-Sony merger. He also claimed that Buch is accountable for the loss suffered by retail shareholders.

The Essel Group chairman also accused Buch of demanding bribes indirectly through a third party. He alleged that a bribe of hundreds of crores was demanded from him to settle the matter with SEBI. This bribe was demanded by a person named Manjit Singh on behalf of Madhabi Puri Buch.

This came after the Congress Party levelled fresh conflict-of-interest allegations against Buch. On Tuesday, the opposition questioned the ICICI Bank’s assertion that it had not paid any salary or granted ESOPs to Buch after her retirement. The opposition asked that if the amount paid to her “retiral benefit”, why was it non-uniform both in terms of its frequency and amount.

Hindenburg’s Accusations

On August 10, 2024, US-based short seller Hindenburg Research came into the limelight once again and accused Madhabi Puri Buch and her husband, Dhaval Buch, of owning stakes in the Mauritius and Bermuda funds named in the alleged money siphoning scandal by the Adani Group.

The short seller also alleged that the SEBI chief didn’t disclose her actual salary and earned way more through the consultancy firm, in which she held a majority stake, in comparison to her official salary from the SEBI.

However, the allegations were denied by the couple. In a detailed statement, Buch and her husband said that the allegations were baseless and they had provided all the needed disclosures to SEBI.

Following Hindenburg’s allegations, former finance secretary Subhash Garg called for Buch’s resignation and a comprehensive investigation into the Adani Group. He also proposed a commission of inquiry comprising judges, securities market experts and a previous chairperson of SEBI under the broad supervision of the Supreme Court to take up the probe.

Investors will be closely monitoring the situation to determine whether the escalating allegations against SEBI Chief Madhabi Puri Buch will influence the ongoing regulatory investigations and impact market confidence. The broader financial community and stakeholders in the Indian market will be keenly observing any shifts in SEBI’s approach to oversight and regulation.