Document-drama: SAT seeks Sebi reply on Jane Street plea

MUMBAI: The Securities Appellate Tribunal on Tuesday directed Sebi to explain within three weeks why it has not shared additional documents sought by US algorithmic trading firm Jane Street. SAT fixed Nov 18 as the next date of hearing on the hedge fund's appeal against the markets regulator's interim order.

Jane Street, which was barred from trading in July and ordered to disgorge Rs 4,800 crore in alleged ill-gotten gains, has argued that Sebi denied it access to crucial material needed to mount a defence. The firm claims that Sebi's own surveillance department, in a Dec 2024 report, had found no evidence of manipulation, contradicting the findings of the investigation wing that passed the July order.

Jane Street has sought 61 documents, including communications between Sebi and the NSE, and email exchanges with a whistle-blower trader, but Sebi has rejected the requests as "fishing enquiries" and said it cannot share material not relied upon in the order.

The case against algorithmic trader Jane Street is a watershed moment in India's market regulation, with Sebi alleging that the firm manipulated benchmark indices by exploiting pricing gaps between the F&O and cash markets, particularly around index expiry.

Jane Street's strategies yielded over Rs 36,500 crore in profits between 2023 and 2025, an unprecedented scale for a proprietary trading firm in India. Sebi said this distorted price discovery disadvantaged millions of retail investors who account for a third of F&O volumes, and highlighted systemic vulnerabilities.