Jane Street, a US-based trading firm, has filed a case against the Securities and Exchange Board of India (Sebi) that has accused the high-frequency trading giant of market manipulations, according to
a Moneycontrol report citing a case petition.
The trading firm has filed the case in the Securities Appellate Tribunal (SAT), and the appeal will be heard on September 8. The SAT is the first point of appeal against the market regulator Sebi.
According to Moneycontrol, Jane Street has confirmed that it has filed an appeal in SAT.
In the petition, seen by Moneycontrol, Jane Street Group entities have prayed for a direction to Sebi to provide full and free inspection of documents. The nature of the information Jane Street is seeking relates to investigations of the firm’s trading conducted by the NSE in November 2024 and by Sebi’s Integrated Surveillance Department (ISD) in December 2024.
Jane Street said Sebi’s own ISD and the NSE had previously concluded there was no manipulation. However, later, Sebi formed a new team and reversed its stance without explanation. Jane Street also sought directions to SEBI not to take any further action till the disposal of the appeal.
In its appeal, Jane Street alleged that orders had been passed mechanically by SEBI. In the petition, Jane Street alleged, “In more than 90% of the patches, it could not be established that the trading activity of Jane Street Group has been attributed to the price movement of the constituents/index in a way which has benefited the open positions of other Group members in the derivatives segment. Even more significantly, the ISD Report found that the Jane Street entities’ profit pattern contradicted any manipulation theory. For the remaining 5 patches, the ISD Report shows that although index prices moved in favor of the Jane Street entities’ options positions, the resulting profits were negligible in the context of the Jane Street entities’ other trading.”
Sebi on July 4 temporarily barred Jane Street from the local market on allegations that it manipulated India’s key indexes, in one of the strongest actions it has taken against a foreign investor. The firm was asked to respond to the allegations within 21 days of the order, but the deadline has passed.
