The Financial Services Commission (FSC) of Mauritius has responded to the latest allegations brought forward by Hindenburg Research, which targeted the SEBI Chairperson Madhabi Puri Buch. In a statement, the FSC clarified that Mauritius does not permit the creation of shell companies and should not be labeled as a "Tax Haven," contrary to the assertions made by Hindenburg.
As the integrated regulator for the non-banking financial services sector and global business in Mauritius, the FSC emphasized the robustness of its legislative framework. "Mauritius has a robust framework for global business companies," the statement read.
It further noted that all global business companies licensed by the FSC are required to meet ongoing substance requirements as mandated by the Financial Services Act. This compliance is closely monitored by the FSC, which ensures that Mauritius adheres to international best practices. The statement also highlighted that Mauritius has been rated as compliant with the standards set by the Organisation for Economic Co-operation and Development (OECD).
Addressing specific claims in the Hindenburg report, the FSC clarified that the fund named "IPE Plus," which was cited by the US short seller, is not a licensee of the FSC and is not domiciled in Mauritius.
"IPE Plus Fund and IPE Plus Fund 1 are not licensees of the FSC and are not domiciled in Mauritius," the statement asserted.
The Hindenburg report had alleged a complex investment structure involving a company controlled by Vinod Adani, which invested in the "Global Dynamic Opportunities Fund" in Bermuda. This fund, in turn, invested in the "IPE Plus Fund 1," which the report described as registered in Mauritius.
The report also claimed that SEBI Chairperson and her husband, Dhaval Buch, had hidden stakes in these offshore funds.
In response, Madhabi Buch and her husband issued a joint statement, explaining that the investment in question was made in 2015 when they were private citizens living in Singapore, well before Madhabi Buch joined SEBI in any capacity.
Morgan Stanley Capital International (MSCI) announced on Tuesday that it would lift the freeze on Adani Group stocks, following the scrutiny spurred by the Hindenburg Research allegations. The changes, which will be implemented starting with the August 2024 Index Review, will include updates to the Number of Shares (NOS), Foreign Inclusion Factor (FIF), and Domestic Inclusion Factor (DIF) for Adani Group and its associated securities.