The Congress on Monday alleged that Securities and Exchange Board of India (Sebi) chairperson Madhabi Puri Buch continued to “draw salary” from her previous employer, ICICI Bank, despite being appointed a whole-time member (WTM) of the market regulator.
Addressing a press conference, Congress leader Pawan Khera alleged that Buch earned Rs 16.8 crore from the ICICI group while being an official at the market regulator and raised potential conflict of interest.
ICICI Bank, however, dismissed the allegations of payments made to Buch post her employment period. In a stock exchange filing, the private sector lender said all payments made to Buch post-2013 had accrued during her employment period. It further said that the bank hasn’t paid her anything other than “retiral” benefits arising out of the grant of employee stock options (ESOPs).
“ICICI Bank or its group companies have not paid any salary or granted any ESOPs to Madhabi Puri Buch after her retirement, other than her retiral benefits. It may be noted that she had opted for superannuation with effect from October 31, 2013,” ICICI Bank said in a statement.
The Opposition party alleged that Buch held an 'office of profit' at ICICI Bank while being an official at Sebi. Khera sought an explanation from Buch and Prime Minister Narendra Modi, who is involved in selecting the Sebi chief.
ICICI Bank said its employees had the choice to exercise their ESOPs anytime up to a period of 10 years from the date of vesting. Buch took charge as Sebi chairperson in March 2022. Before that, she was a WTM between April 2017 and October 2021. Prior to joining Sebi, she was associated with ICICI Bank and its group firms between 1997 and 2011. Buch is also the first chairperson from the private sector.
On Khera’s allegations that ICICI Bank had been deducting tax at source (TDS), the lender said, “As per Income Tax rules, the difference between the price of the stock on the day of exercise and the allotment price is treated as perquisite income and is reflected in Part B of the Form 16 of employees, including retired employees. The bank is required to deduct the perquisite tax on this income. In addition, Form 16 covers the payment made towards the retiral benefits of former employees.”
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Citing a recent news item, Khera alleged Buch “changed regulations” to favour the ICICI group and facilitated easier delisting of its broking arm ICICI Securities as a “favour.”
The Congress also alleged that the Sebi chair continued to pass judgments and was involved in matters concerning the ICICI group while “earning income from the group”.
Speaking at a session by CII in Mumbai on Monday, Buch did not respond to questions on the fresh allegations. However, in her address she said, “Even if I talk of REITs, I am accused to have a conflict of interest.”
Last month, the New York-based short-seller Hindenburg Research had questioned Buch’s objectivity in probing the Adani Group, alleging that she held stakes in offshore entities used to siphon off funds and manipulate stock prices. Hindenburg had also red-flagged the income generated by Buch and her husband’s consultancy firm, Agora Advisory.
Buch and her husband, Dhaval Buch, had issued statements refuting all the allegations. She added that they had made disclosures and had included connected firms in her recusal list.
In a statement issued post the Hindenburg allegations, the duo had said that during their long corporate careers they “have accrued their savings through their salaries, bonuses and stock options. Insinuations about net worth and investments referencing Madhabi’s current government salary are malicious and motivated.”