Congress targets SEBI chair Madhabi Puri Buch over ICICI Bank payments

On September 2, 2024, during a press conference, Congress Targets SEBI as leader Pawan Khera leveled significant accusations against Madhabi Puri Buch, the chairperson of the Securities and Exchange Board of India (SEBI). Khera claimed that Buch had received a total of ₹16.8 crore from ICICI Bank and its subsidiaries since her appointment to SEBI in 2017. This sum was reportedly 5.09 times higher than her SEBI salary, which was approximately ₹3.3 crore during that timeframe.

Khera underscored that Buch’s acceptance of remuneration from a private entity such as ICICI Bank, while she was responsible for regulating its activities as the head of SEBI, represented a significant breach of ethical standards.

Khera called upon Buch to make a public disclosure regarding her financial transactions and the specific services rendered to ICICI Bank in return for the payments received. Khera expressed discontent with SEBI’s involvement in the merger of ICICI Bank and ICICI Securities, which had sparked apprehensions among shareholders.

The Congress leader extended his criticism beyond Buch, also targeting Prime Minister Narendra Modi and Home Minister Amit Shah, questioning their involvement in Buch’s selection as SEBI chairperson. Khera implied that the Appointment Committee of the Cabinet, which includes the Prime Minister, should have been cognizant of Buch’s financial affiliations, thereby raising questions about the thoroughness of the vetting process for regulatory appointments.

ICICI Bank has firmly rejected the allegations put forth by the Congress party. In a comprehensive statement, the bank clarified that neither it nor its affiliated companies provided any salary or Employee Stock Ownership Plans (ESOPs) to Buch following her retirement on October 31, 2013, apart from her retirement benefits.

Key Points from ICICI Bank’s Clarification:

All payments made to Buch after her retirement were accrued during her tenure with the ICICI Group, which included ESOPs and retirement benefits. The bank emphasized that Buch had chosen to participate in superannuation, a retirement benefit designed to assist employees in accumulating funds for their retirement.

According to the bank’s ESOP regulations, employees, including those who are retired, have the option to exercise their ESOPs at any time within 10 years from the date of vesting.

Following Income Tax regulations, the difference between the stock price at the time of exercise and the allotment price is classified as perquisite income, which is documented in Form 16 for employees. The bank is obligated to withhold perquisite tax on this income.

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