Jane Street Appeals SEBI Ban Over Index Allegations

Jane Street, a leading U.S.-based high-frequency trading firm, has formally appealed to India‘s Securities Appellate Tribunal (SAT), seeking to compel the Securities and Exchange Board of India (SEBI) to release documents it says are crucial to defending itself against allegations of market manipulation in Indian indexes. The move marks a rare legal confrontation between a major foreign investor and India’s top financial regulator.

SEBIs Interim Order and Trading Ban

In early July 2025, SEBI issued an interim order temporarily barring Jane Street from trading in India‘s securities market, accusing the firm of manipulating the Bank Nifty index. SEBI’s July 4 order alleged that Jane Street and affiliated entities had established large positions in Bank Nifty index stocks early in the trading session, while simultaneously taking short positions in related index options. According to SEBI, Jane Street later sold the underlying stocks, incurring losses on those positions, while allegedly realizing substantial gains on its derivative trades. This is among the most stringent actions SEBI has ever taken against a foreign participant in Indias markets.

SEBI also imposed a hefty $567 million penalty on Jane Street, which the company has reportedly paid. While Jane Street is technically permitted to resume trading, it has so far chosen not to re-enter the Indian market, according to industry sources.

Jane Streets Legal Challenge

In its appeal, Jane Street argues that SEBI has refused it “full inspection of all relevant and relied upon material,” hampering its ability to effectively rebut the regulator‘s accusations. Notably, during a partial review of SEBI’s evidence, Jane Street claims to have discovered an internal SEBI surveillance report dated December 2024 that did not conclude manipulation by Jane Street entities in Indias two main indexes. The report reportedly stated, “On the basis of available information at this juncture, it is proposed that the matter may not be pursued further.”

“These documents are undeniably relevant,” Jane Street asserted in its filing, highlighting what it views as inconsistencies in SEBIs case. The company has requested that the Securities Appellate Tribunal direct SEBI to release all withheld materials.

A source familiar with the matter confirmed that the appeal seeks to ensure Jane Street receives a fair defense process by obtaining access to all documents SEBI relied on. Neither Jane Street nor SEBI responded to requests for further comment.

Broader Implications for Foreign Investors

Legal experts note that this case represents a rare instance of a major foreign financial firm contesting SEBI‘s regulatory actions in open court. The outcome could set a precedent for how India’s markets regulator treats foreign participants and addresses due process concerns.

The dispute also underscores the heightened scrutiny on high-frequency trading in emerging markets, where regulators are increasingly vigilant about potential abuse of sophisticated strategies. Observers suggest the case may influence future foreign investment inflows, depending on perceptions of regulatory fairness and transparency.

About Jane Street

Jane Street is a globally recognized quantitative trading firm headquartered in New York, specializing in algorithmic and high-frequency trading across equities, derivatives, and other asset classes. Known for its technological sophistication and robust risk management, Jane Street operates in over 30 countries, including a significant presence in Asia.

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