SEBI Chairperson Madhabi Puri Buch, along with her husband Dhaval Buch, on September 13 issued a statement refuting allegations of corruption and moonlighting claims.
The statement provided clarity on Madhabi’s Employee Stock Options (ESOPs) from ICICI Bank, stating that the bank’s rules allowed retired employees, such as Madhabi, to exercise vested options over 10 years — contrary to claims suggesting irregularities in her pension payments.
“With respect to the baseless allegations concerning the exercise of Employee Stock Options (ESOPs), it is completely false that the options are to be exercised only in 3 months,” the statement said.
“With respect to the baseless allegation concerning the uneven nature of pension amounts with gaps in between, the fact is that the pension payments were consistent. They were part of a contributory Annuity Scheme from ICICI Prudential. The uneven amounts related to exercise of ESOPs at various stages over the 10 years. Depending on when Madhabi exercised her options and the prevailing market prices at the relevant time and the quantity of ESOPs exercised, the perquisite value is bound to vary each year. If no ESOPs were exercised in a given year, there would be zero value attached to it and this would be bound to be reflected in the returns as a gap year,” it added. “This perquisite value is required to be filed under the "Salary" category both by ICICI Bank and by the ex-employee. This is a clear law of the land.”
Dismissing the claims of non-payment of TDS, it said, “With respect to the baseless allegation concerning payment of TDS by ICICI Bank, the fact is that ICICI Bank did not pay TDS from its own funds. Instead, when an employee or ex-employee exercises their options, ICICI Bank collects the required Perquisite Tax (for TDS) from the individual upfront and pays the same to the tax authorities. This was the process followed with Madhabi as well – ie Madhabi paid her own Perquisite Tax, upfront.”
On moonlighting claims
The statement said Madhabi has never dealt with any files related to the ICICI Group of Companies during her tenure.
“With regard to the baseless allegations of moonlighting while employed with ICICI Bank, the fact is that Madhabi did not engage in any unauthorised external employment while working at ICICI Bank. In 2011, she was granted long leave (unpaid ) by the Bank to join her husband who was working in Singapore at that point of time. During her time there, in Singapore, with ICICI Bank's full and prior approval, she took up a position with a Private Equity Firm in Singapore. When it became clear in 2013 that she would remain in Singapore, she superannuated from ICICI Bank as per the Bank’s rules. The Private Equity firm, in turn, was also fully aware of the fact that she was in Singapore on long leave taken from ICICI Bank. The arrangement was completely legal and transparent,” it added.
Additionally, the statement also listed the companies from which she had recused herself, including prominent firms like Mahindra Group, ICICI Group, and Pidilite Industries, which have a significant presence in the stock exchanges.
The market regulator chief’s statement comes in response to the allegations made by Congress spokesperson Pawan Khera, raising conflict-of-interest questions.