Sebi's probes spike, but turn exhaustive

Sebi barred Sathe and his firm from thesecurities market and asked them to deposit the alleged illegal gains of %546 crore into an account, with a lien marked in favour of Sebi.

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Sathe and his academy challenged the regulator's order at SAT, denying the allegations. Thetribunal granted him temporary relief by allowing the company to access funds.

Asimilarinvestigative intensity was seen in the 105-page Jane Street order. Sebi devoted sections to explaining the basics of indices, futures, and options, with detailed illustrations of how these different instruments interact. The order outlined the methodology used to identify impugned trading days, presented tabular flowcharts of intraday strategies, and included charts and tables that mapped each relevant trade in Bank Nifty contracts. A QR code was even generated to allow easier access to voluminous data.

Sebi barred Jane Street for allegedly manipulating indices and ordered it to disgorge illegal gains worth more than %4,800 crore. The high-frequency trading firm denied the charges and has appealed to the SAT against Sebi’s move.

The level of depth seen in investigations was not always there. A 96-page interim order-cum-show cause notice issued in 2023 in the Axis Mutual Fund front-running case, while detailed for its time, largely set out Sebi’s findings rather than walking through the investigative logic and evidentiary trail.