Jane Street Files Case Against Sebi in Market Manipulation Dispute: Report

US trading giant Jane Street has taken India’s markets regulator to the Securities Appellate Tribunal (SAT), contesting accusations of market manipulation.

A case document reviewed by Reuters shows the firm arguing that the Securities and Exchange Board of India (SEBI) is withholding crucial records, as per a report by Reuters.The tribunal is the first level of appeal against Sebi’s orders. In its filing, Jane Street stated the regulator failed to provide documents necessary to contest the charges. The appeal asks SAT to compel Sebi to hand over the material.

“These documents are undeniably relevant,” the firm wrote in its submission, as quoted by Reuters. The dispute stems from a July 4 order, in which SEBI temporarily barred Jane Street from Indian markets, alleging manipulation of key indexes. leaving the clash now playing out before the appellate tribunal.

It was one of the most forceful actions the watchdog has taken against a foreign investor. The firm had been directed to respond within 21 days, but that deadline has already passed,

What Happened Between Jane Street And SEBI?

Earlier in the month of July 2025 SEBI has banned the Wall Street trading giant from trading in Indian market. The trading giant's funds with $567 million were frozen on the accounts for manipulation of stock indices through derivative trading. 

SEBI accused Jane Street of specifically targeting the Bank Nifty index, which tracks 12 major banks. The allegation was that Jane Street allegedly used two separate entities to move prices in both the cash and derivatives markets.

According to Sebi, one arm of Jane Street would buy significant volumes of bank shares at the market's opening, artificially lifting the Bank Nifty. At the same time, another arm placed bets in the derivatives market on the index falling. By the close of trading on expiry day, Sebi claimed, Jane Street dumped the purchased shares, driving the index down. 

Small investors bore the brunt, having bought shares at inflated prices during the day, only to see values collapse. Sebi concluded bluntly: Jane Street's trades created "a false or misleading appearance of market activity," damaging market integrity and eroding trust.

Later, the ban on Jane Street was lifted after the trading giant deposited Rs 4,844 crore in an escrow account to comply with SEBI's order.

"Exchanges have confirmed that they will comply with this," Sebi said in an official statement.

"In terms of interim order in matter of index manipulation by Jane Street group dated July 3, 2025, upon compliance with the directions...(creation of escrow account with a lien marked in favour of SEBI, for an amount of Rs 4,844 crore), the directions stipulated in clauses ...of interim order shall cease to apply," Sebi said in an official statement.