Mumbai, March 2, 2025: In a significant development, a special court in Mumbai has ordered the registration of an FIR against Madhabi Puri Buch, the former chairperson of the Securities and Exchange Board of India (SEBI), and five other officials over alleged stock market fraud and regulatory violations. The order was issued by Special Judge Shashikant Eknathrao Bangar on March 1, 2025, directing the Anti-Corruption Bureau (ACB) to investigate the matter and submit a detailed report within 30 days.
The allegations against Buch and the others pertain to regulatory lapses and alleged collusion that facilitated financial fraud on a large scale. The court observed that there were prima facie evidences suggesting regulatory breaches and a need for an impartial investigation. The decision came in response to a complaint filed by a media reporter, who claimed that SEBI officials failed to perform their statutory duties, allowing market manipulation and corporate fraud to thrive unchecked.
The petition also alleged the SEBI authorities of allowing those companies to get listed that lacked the required standard, thus making space for malpractices on a corporate scale. The order by the court indicated the urgency for judicial interference in accordance with the provisions under the Criminal Procedure Code (CrPC) based on the ineffectiveness of the law enforcing authorities in entertaining the complaint in the past.
After being accused by the American research and investment firm Hindenburg Research, Madhabi Puri Buch, who just finished her three-year term as SEBI’s first female chief amid political controversy, is facing a difficult legal battle. The charges had previously caused a political uproar and raised doubts about the reliability of India’s securities market watchdog.
The court’s order requires the ACB to monitor the investigation closely and submit a detailed report within the given time frame. As the investigation progresses, the examination of SEBI’s regulatory regime and its officials will only gain momentum.
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