By Nesil Staney
The Securities and Exchange Board of India (Sebi) is quite confident that its interim order on Jane Street (JS) and its affiliates will pass the muster of the Securities Appellate Tribunal (SAT) and higher authorities, said sources in the know.
The US-based market maker said that JS is expected to challenge Sebi’s interim order in the Securities Appellate Tribunal (SAT), and even Supreme Court (SC). The firm’s spokesperson on Friday said, “Jane Street disputes the findings of the Sebi interim order and will further engage with the regulator. Jane Street is committed to operating in compliance with all regulations in the regions we operate around the world.”
Sebi officials, however, are confident about the order. “This is an open and shut case even for the SEC (Securities and Exchange Commission),” the source said, adding that the interim order clearly indicates investigations will continue across exchanges. “The scope here is quite large,” he added.
What makes Sebi’s case stronger is that the National Stock Exchange (NSE), acting under instructions from the market regulator, had advised JS in February to avoid high-risk activity in index options and refrain from any trading behaviour that could indicate manipulation. The JS Group gave assurance to the exchange, through its compliance partner Nuvama, that it will fully comply with applicable regulations.
It also appealed that there was no human intervention or malafide intent as trades were driven by algorithms. Satisfied with the reply, the NSE closed the probe on April 30.
However, in May 2025, the group again executed what appeared to be manipulative “extended marking the close” strategies—entering large, aggressive trades in index and stock markets around expiry closing—to move the index in their favour.
The index strategies on expiry days that Sebi cited were executed by at least three large algo traders, said the source close to JS. ” It can also seek a regulatory settlement of the impound,” he said.
Sebi’s interim order impounded Rs 4,844 crore – the highest ever – of unlawful gains. It also allowed the firm to continue to trade, if it deposits the impounded amount. The idea, said sources, was not to discourage making money but manipulation.
JS had earlier approached Sebi for settlement, said a fund manager at a large foreign portfolio firm (FPI). At that point, Sebi continued with investigations.
Meanwhile in June, several FPI traders and large Indian proprietary traders took their complaints to finance minister Nirmala Sitharaman, and some even raised concerns with the Prime Minister’s grievance cell, before Sebi’s decision. The regulator has only skimmed the surface of index manipulations, said the fund manager, who added that Sebi clearly received orders from the finance ministry to take action on JS.
On Friday, Sebi barred JS entities from operations in India. In 2024, JS’s India revenues exceeded $2.3 billion. As per Sebi, Jane’s Rs 36,502 crore in profits between January 2023 and March 2025, includes Rs 43,289 crore profits from index options and Rs 7,687 crore losses in cash and futures. Jane profited hefty on January 17, 2024, booking Rs 734.93 crore from a dramatically engineered move in Bank Nifty.
Comparatively, JS peers Citadel Securities India Markets earned $344 million for the 12 months ended March 2024 and Optiver BV earned modest profits around $300 million in calendar year 2024 from options trading in India. Other prominent firms in algo-trading and high-speed trading include IMC Trading, Flow Traders, Tower Research, Two Sigma, Jump Trading, Goldman Sachs, Hudson River and DRW.
The interim order reflects a strong stance on algo-traders, said some market participants. The final outcome may include modification or revocation of the interim directions, possible adjudication or regulatory action, based on findings.
