SEBI has lot to explain: Congress after Mauritius FPIs ‘challenge’

New Delhi: The Congress on Sunday said the SEBI investigation into “the Adani Group’s brazen attempt” to bypass regulations is still languishing and the capital markets regulator has a lot to explain.

Congress general secretary in-charge communications Jairam Ramesh’s remarks attacking SEBI came after a media report which claimed that two Mauritius-based foreign portfolio investors (FPIs), who were mentioned in the January 2023 report on the Adani Group by short-seller Hindenburg Research, have petitioned the Securities Appellate Tribunal, seeking urgent relief from complying with SEBI’s new foreign investor norms.

“Two Mauritius-based foreign portfolio investors (FPIs), a part of the revelations in the still-unfolding Modani mega scam, have now petitioned the Securities Appellate Tribunal, seeking urgent relief from complying with SEBI’s new foreign investor norms before the upcoming September 9th deadline,” Ramesh said.

Both the FPIs are alleged to be violating rules that require investors to not be over-invested in a single stock, he said. These rules are meant to ensure that black money routed through tax havens does not flood back into Indian capital markets, Ramesh said, adding they must be upheld at all costs.

“These are the very same FPIs who stand accused of participating in the Adani Group’s brazen attempt to bypass SEBI’s regulations and amass benami stakes in its own companies. These are the very firms that benefitted from SEBI’s removal of the requirement to identify the ‘ultimate beneficial owner’ of offshore funds, a decision that it was forced under public pressure to reverse in June 2023 in a tacit admission of its guilt,” the Congress leader said in his post on X.

“The basic fact is that a SEBI investigation into these violations that was supposed to be completed in two months and shared with the Supreme Court is still languishing 18 months later,” Ramesh said.