Jane Street folds to Sebi order on market manipulation, deposits over ₹4,800 crore in escrow accounts

After the Securities and Exchange Board of India (Sebi) barred US trading firm Jane Street from accessing local securities markets and slapped an impound notice for unlawful gains of more than ₹4,843 crore, the Wall Street trader has reportedly deposited the amount as instructed by the Indian markets regulator.

 

According to a Reuters report citing “two sources with direct knowledge of the matter”, Jane Street deposited $567 million (equivalent to around ₹4,843 crore) in escrow accounts so that Sebi would let the US firm resume trading in India.

 

THE WEEK had, earlier in July, reported on Sebi slapping Jane Street with an interim order following an ongoing investigation into alleged manipulation of the market via the positions it took in the equity derivatives market.

 

Back then, the Sebi order read: “Entities are restrained from accessing the securities market and are further prohibited from buying, selling or otherwise dealing in securities, directly or indirectly.”

 

However, this move by Jane Street came just days after the company asserted that it would contest the allegations of the market regulator, dismissing their actions as “basic index arbitrage trading”.

 

The Sebi action on Jane Street also led to further noise in the Sebi after some reports claimed it to be a “regulatory failure”. To this, former Sebi chairperson Madhabi Puri Buch last week published a statement: “It is extremely unfortunate that certain sections of the media are choosing to ignore facts in plain sight and seeking to create a false narrative by implying that there was regulatory failure by Sebi.”

 

Asserting that Sebi kicked off the investigations as early as April 2024, Buch said that the markets watchdog took many steps, such as identifying index manipulation and issuing multiple circulars and caution letters between April 2024 and February 2025 to Jane Street to cease and desist from certain trading patterns.

 

In the interim order dated July 3 2025, Sebi determined that New York-based hedge fund Jane Street manipulated indices by taking bets in the cash and futures and options markets simultaneously. 

 

This led to the suspension of Jane Street, following the order to impound over ₹4,843 crore in gains. The Sebi probe also found that Jane Street made a net profit of ₹36,671 crore from January 2023 to May 2025.

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