SEBI Bans Jane Street Amid Market Manipulation Charges

The Securities and Exchange Board of India (SEBI) has taken decisive action against Jane Street, a prominent U.S.-based trading firm, on serious allegations of market manipulation. Accusations suggest that Jane Street engaged in practices to artificially inflate stock prices, benefiting from options trading while violating India’s capital market regulations.

SEBI describes Jane Street's trades as "prima facie fraudulent and manipulative." The regulator has frozen approximately ₹4,844 crore (around $566.3 million) in alleged illegal gains. This financial penalty is part of an extensive investigation focusing on the firm’s trading activities.

In a notable development, SEBI has imposed a trading ban on Jane Street and its related entities, barring them from buying, selling, or dealing in any securities for the time being. This suspension stemmed from preliminary findings indicating suspicious trading, which led to significant unfair gains.

The investigation into Jane Street has been unfolding for around 15 months. During this period, SEBI issued several caution letters about the firm's trading violations. Jane Street is specifically accused of manipulating Nifty and Bank Nifty index levels, resulting in misguidance for retail investors.

This ban restricts Jane Street's access to the Indian equities market until the firm returns the alleged unlawful gains, emphasizing the rigorous scrutiny foreign trading firms face in India. This case illustrates the heightened vigilance of Indian regulators in monitoring trading practices and ensuring adherence to market regulations.

For more information on financial regulations in India, you can visit SEBI's official site.