Jane Street Group has expressed its disagreement with the Securities and Exchange Board of India (SEBI) regarding the latter’s interim order that bars its associated entities from accessing the Indian securities market. The order impacts several Jane Street entities, including JSI Investments Private Ltd and Jane Street Singapore Pte. Ltd.
Despite the ban, the company has stated its intention to cooperate fully with SEBI, affirming its commitment to regulatory compliance globally. “Jane Street remains committed to complying with all applicable regulations in every region where we operate,” Jane Street said in an emailed statement to Reuters.
The interim order by SEBI prohibits the entities from engaging in securities transactions. This action is part of SEBI’s efforts to maintain trust in the market and safeguard investor interests. The order followed SEBI’s findings of alleged market manipulation involving the Bank Nifty index, which comprises key stocks of major Indian banks. SEBI’s preliminary findings suggest a complex and unlawful manipulation facilitated by Jane Street’s extensive trading capabilities.
SEBI’s order requires the Jane Street entities to open an escrow account in a scheduled commercial bank in India, where the alleged unlawful gains amounting to Rs 4,843 crore must be deposited. “Entities are directed to open escrow account in a Scheduled Commercial Bank in India to deposit jointly and severally the aforesaid amount of unlawful gains with a lien marked in favour of SEBI,” SEBI stated.
The investigation revealed that Jane Street’s global operations, including its Indian market dealings, are managed collectively by senior personnel based overseas. “Note that the email sent by Jane Street to SEBI dated August 30, 2024, and the letter from Jane Street to NSE dated February 21, 2025, both indicate that all Jane Street Group entities dealing in Indian markets act collectively,” noted SEBI.
This case is particularly notable for its scale and the nature of the alleged violations. Unlike previous incidents which typically involved individual stocks, this case involves manipulation across multiple liquid stocks. SEBI remarked, “Past instances of securities market violations have mostly involved individual stocks or segments. However, this is an unusual case where prima facie, multiple liquid stocks with high retail participation have together been manipulated.”
Jane Street’s entities, including those registered as Foreign Portfolio Investors (FPIs), face strict enforcement of SEBI’s directives. The market regulator has instructed depositories to prevent any debits without its explicit consent. Furthermore, it has mandated that any open positions must be closed or squared-off within a specified period. Banks, custodians, and depositories are tasked with ensuring stringent compliance with these measures.
The SEBI order clarifies that although FPIs are legally allowed to deploy funds and divest holdings within set boundaries, the core operations of Jane Street’s entities do not align with typical investment activities. The focus has been on short-term financial transactions rather than medium to long-term investments.
This development marks a significant regulatory action by SEBI and underscores the ongoing scrutiny of financial practices involving complex trading strategies in India. Jane Street’s response indicates a willingness to work with the regulator, while the outcome of this engagement remains to be seen.
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