Jane Street vs SEBI: Legal Battle Begins Over ₹4,843 Crore Trading Ban
Challenging a ₹4,843 crore trading freeze, Jane Street accuses India’s market regulator of secrecy and procedural violations in court
In a high-stakes legal face-off, global proprietary trading firm Jane Street began formal proceedings against the Securities and Exchange Board of India (SEBI) at the Securities Appellate Tribunal (SAT) today. The firm is contesting SEBI’s July 2025 interim order that accuses it of manipulating India’s derivatives markets and freezes nearly ₹4,843 crore in alleged unlawful gains.
The SAT bench, led by Justice P.S. Dinesh Kumar, commenced hearing Jane Street’s appeal, where the firm strongly denied any wrongdoing and sought a stay on SEBI’s restrictions. Jane Street argued that SEBI’s action lacked procedural fairness, pointing to the regulator’s refusal to share internal communications and whistleblower reports key to its defense.
SEBI’s interim order claimed that Jane Street employed manipulative trading strategies, particularly on expiry days of Nifty and Bank Nifty index options, executing aggressive trades in the morning to influence market prices. These trades allegedly helped the firm amass extraordinary profits in index options, ₹43,289 crore over 27 months, while other trading segments showed losses.
SEBI barred Jane Street and its Indian affiliates from trading in Indian securities and froze their profits, stating that the strategies were “prima facie manipulative.”
Jane Street, known globally for quantitative trading, contends that its actions constituted routine arbitrage, legal and widely practiced across markets. It maintains that SEBI has denied it access to crucial documents, including exchanges between SEBI and the whistleblower Mayank Bansal, as well as correspondence with the National Stock Exchange (NSE).
“The lack of transparency has compromised our right to a fair hearing,” said Jane Street’s legal team in court, emphasizing that the firm paid the escrow amount under protest but remains unable to resume operations in India.
Sources close to the investigation revealed that SEBI initially considered closing the case but escalated the probe in late 2024 due to continued complaints and insufficient data from Jane Street. The crackdown is now seen as a watershed moment in India’s regulatory oversight of high-frequency and algorithmic trading.
The case is being closely watched by global trading giants, including Citadel, Jump Trading, and IMC, many of which operate in Indian markets. Legal experts say the outcome could set a precedent for how India handles market manipulation claims involving sophisticated foreign players.
As hearings continue, the tribunal is expected to rule on Jane Street’s plea to suspend SEBI’s trading ban and order full disclosure of withheld documents. A final decision could significantly impact regulatory frameworks surrounding derivatives trading and transparency in enforcement proceedings.