Jane Street vs SEBI: SAT Adjourns High-Stakes Market Manipulation Case

The Securities Appellate Tribunal (SAT) has adjourned the hearing in the high-profile dispute between US-based trading giant Jane Street and India’s market regulator, the Securities and Exchange Board of India (SEBI). 

The case, centered on alleged manipulation of the Bank Nifty index, has drawn intense scrutiny due to the scale of alleged gains and the regulatory implications for high-frequency trading firms operating in India.

SEBI’s Allegations: Two-Pronged Manipulation Strategy

In July 2025, SEBI accused Jane Street Group of artificially influencing the Bank Nifty index between January 2023 and March 2025. According to the regulator, the firm used its high-frequency trading capabilities to manipulate index movements for unlawful derivatives gains.

SEBI alleged that Jane Street deployed a dual-entity strategy. One arm of the firm allegedly purchased large quantities of banking stocks to push up the index, while another simultaneously built options positions designed to benefit from the induced price movement. The regulator concluded that this coordinated activity generated illegal profits amounting to ₹4,843.57 crore.

Regulatory Action and Deposit of Alleged Gains

Following its findings, SEBI ordered Jane Street to deposit ₹4,843.57 crore and temporarily barred the firm from trading in Indian markets. The trading restriction was lifted after the firm deposited ₹4,843.5 crore, effectively complying with the financial directive while reserving its legal rights.

The action marked one of the largest enforcement moves in India’s capital markets, underscoring SEBI’s tightening oversight of algorithmic and high-frequency trading practices.

Jane Street’s Appeal Before SAT

In September 2025, Jane Street approached SAT, challenging Sebi’s order. The firm argued that it was denied adequate access to documents and information necessary to mount a proper defense. It also contended that a separate inspection by another SEBI department had found no evidence of manipulation.

The adjournment now delays a closely watched legal battle that could shape regulatory standards for complex trading strategies in India.

Read more: SEBI Probe on Zee Drags On, Promoter Overhang Continues and Investors Stay on Edge.

Conclusion

The Jane Street- SEBI dispute represents a landmark case for India’s capital markets, particularly in the evolving domain of high-frequency trading. As the SAT prepares to hear the matter, the outcome could set critical precedents on market conduct, enforcement powers, and procedural fairness. For global trading firms, the case serves as a reminder that India’s regulatory framework is becoming increasingly assertive and vigilant.

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