India’s markets regulator called Jane Street Group LLC’s demand for additional documents a “dilatory” tactic, a day after the US-based hedge fund asked the Securities Appellate Tribunal (SAT) to direct the Securities and Exchange Board of India (Sebi) to share the trading records behind its market manipulation allegations.
Gaurav Joshi, a lawyer representing the Securities and Exchange Board of India, opened Tuesday’s arguments with a Hindi proverb that roughly translates to “the thief reprimanding the police,” suggesting that Jane Street was trying to turn the accusations against the regulator. The hearing will continue on Wednesday, Bloomberg reported.
The firm is seeking to question SEBI’s conduct instead of explaining its trading strategy and responding to the interim order, Joshi told a local court. The regulator was only required to provide documents it relied on to pass its order, and furnishing additional information could harm the ongoing probe, he argued.
The SEBI lawyer said that it was for Jane Street to explain why its strategy does not amount to market manipulation, adding that the Wall Street trader has “succeeded in delaying” the matter for a year and a half.
Jane Street has been seeking additional documents and internal emails from the regulator to mount its defence against the interim order. At Monday’s hearing, Jane Street’s lawyer said that Sebi should hand over the trading records used to accuse the firm of manipulating index prices and then profiting from options trading.
Jane Street’s lawyer argued that the regulator’s allegations could not be properly tested without access to the underlying trading data, including information about counterparties, timing, quantum, and prices.
SEBI had renewed its investigation against Jane Street even after the National Stock Exchange and the regulator’s surveillance department cleared the firm of market abuse.
On September 4, Jane Street’s lawyer sought access to correspondence between Sebi and the National Stock Exchange (NSE) relating to a study by the exchange on the firm’s trades. Two earlier reviews conducted in 2024 by NSE and Sebi’s Integrated Surveillance Department (ISD) found no evidence that its trades influenced index prices to benefit its options positions.
Jane Street case puts focus on risks for global trading firms
The outcome of the case could shape global trading firms’ perceptions of the risks associated with operating in one of the world’s largest derivatives markets.
Central to the controversy is SEBI’s allegation that Jane Street affected the pricing of stocks in the NSE Nifty Bank Index, a closely watched benchmark that serves as the foundation for heavily traded options contracts, as per the Bloomberg report.
SEBI’s July 3, 2025, interim order temporarily banned the firm from trading in Indian securities and ordered the seizure of 48.4 billion rupees ($503 million) in alleged unlawful gains. Jane Street deposited the amount in an escrow account but hasn’t resumed trading in the country.
(With inputs from Bloomberg)
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