The Congress on Friday said SEBI's decision to mandate enhanced disclosure requirements for some foreign portfolio investors points to a "clear admission of guilt" by the market regulator in the wake of Supreme Court's expert committee recommendations. Congress general secretary Jairam Ramesh asserted, in a statement, that SEBI's investigation has limited scope and only a joint parliamentary committee (JPC) probe can fully unravel the Adani "scam".

He said they are also awaiting the SEBI report slated for August 14 that would answer key questions on the origins of the Rs 20,000 crore "opaque foreign funds" flowing into Adani group of companies. "The Supreme Court’s Expert Committee used soft but damning language regarding SEBI’s approach to the Adani MegaScam. It claimed that there was no regulatory failure by SEBI but rather 'piquantly' went on to describe a number of major regulatory failings, including the rewriting of rules that allowed opaque overseas funds to be invested in Adani companies in huge quantities.

"The reintroduction of strict reporting rules following the SEBI board’s 28 June, 2023 meeting represents a public admission of guilt by the regulatory body," he said in a statement.

Sharing the statement on Twitter, Ramesh said, "....the actions it (SEBI) has taken since the Supreme Court's Expert Committee report on the Adani Megascam pointing to a clear admission of guilt by the regulatory body." The Congress leader said the Securities and Exchange Board of India (SEBI) accepts that it needs to do more to prevent the “circumvention of regulations such as the requirement for Minimum Public Shareholding”, precisely the allegation made against the Adani Group.

It has, therefore, mandated “additional granular level disclosures regarding ownership, economic interest, and control” for foreign portfolio investors who (1) hold more than 50 per cent of their India assets in a single corporate group or (2) more than Rs 25,000 crore in Indian markets, he said.

It also states that the Prevention of Money Laundering Rules on beneficial (actual) ownership were tightened in March 2023, the Congress leader noted.

"None of these steps would have been possible without the wide public outrage over the Modani revelations and the Congress party’s relentless 'Hum Adanike Hain Kaun-HAHK series' of 100 questions that put the government under tremendous pressure to act.

"Despite desperate attempts by interested parties to paint the Expert Committee’s report as a 'clean chit', all the actions taken subsequently by SEBI indicate an admission of guilt and a belated attempt to increase transparency regarding financial flows," Ramesh said.

SEBI’s own report, scheduled for 14 August, is awaited, he said.

"We look forward to clarity on important questions such as the origins of the shady Rs 20,000 crore of opaque foreign funds that have flowed into Adani companies," Ramesh noted.

"As we have always said, the Expert Committee’s and SEBI’s own investigations are limited in scope. Only a JPC can fully unravel the 'Modani MegaScam' by delving into PM Modi’s crony links with the Adani Group and how he has personally facilitated their business in India and abroad by changing laws, rules and regulations to help his close friends," the Congress leader also said. To ensure greater transparency, markets regulator SEBI on Wednesday decided to mandate enhanced disclosures from certain class of foreign portfolio investors (FPIs), including furnishing granular level details about ownership and economic interests.

The new norms will be applicable for FPIs that concentrate holdings in a single corporate group.

The move is aimed at preventing possible circumvention of Minimum Public Shareholding (MPS) requirements and potential misuse of the FPI route to guard against the inherent risks of opportunistic takeover of Indian companies.

It also comes against the backdrop of the recent Adani-Hindenburg saga.

During its meeting here on Wednesday, the SEBI board also approved a proposal to amend the FPI rules.

Under the proposed framework, FPIs with concentrated single group equity exposures or significant equity holdings will be mandated to make additional granular disclosures.

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