Inside Jane Street's SAT challenge against Sebi

Jane Street's fight with India's capital markets regulator has entered a decisive phase.

- Neha Joshi

On Wednesday, four entities of the global trading firm moved the Securities Appellate Tribunal (SAT) against the Securities and Exchange Board of India (Sebi), alleging that the regulator withheld crucial information while investigating the group.

At stake is not only a ₹4,843 crore escrow deposit but also the question of whether Sebi suppressed exculpatory findings while accusing Jane Street of index manipulation.

The core of Jane Street's appeal is that two earlier reviews—one by the National Stock Exchange (NSE) and another by Sebi's Integrated Surveillance Department (ISD)—had already cleared its trades. Yet, in July this year, Sebi relied on a new theory to issue a sweeping interim order without acknowledging those findings.

Mint unpacks what triggered the appeal, the contradictions Jane Street highlights in Sebi's case, the legal arguments being pressed, and the reliefs sought before SAT.

What triggered the appeal?

On 3 July, Sebi passed an ex-parte interim order against four Jane Street affiliates, accusing them of manipulating Bank Nifty index prices on 21 dates to benefit their derivatives positions. The regulator said these trades, some clustered around expiry days, fit a strategy it termed "Extended Marking the Close." Jane Street was barred from the market and directed to park ₹4,843 crore in an escrow account, which it did promptly.

Jane Street then sought inspection of the records Sebi relied on. While the regulator allowed limited access in August, it withheld several key documents: