Jane Street Sets Aside $564 Million as India Probe Continues | Company Business News

(Bloomberg) — Jane Street Group LLC has deposited 48.4 billion rupees ($564 million) in an escrow account to comply with an order from India’s securities regulator, part of an ongoing probe into allegations of market manipulation by the US trading giant.

While Indian authorities had previously indicated the deposit would allow Jane Street to return to local markets after a ban imposed on July 3, the regulator’s statement on Monday didn’t clarify whether the firm has a green light to resume trading. The Securities and Exchange Board of India has accused Jane Street of manipulative transactions involving local options and shares — allegations that the firm has denied.

Jane Street doesn’t intend to immediately return to India’s options market, a person familiar with the matter said, asking not to be named as the information is private. The firm didn’t reply to emails seeking comment.

India’s bombshell allegations against Jane Street have gripped the financial industry, pitting one of the world’s biggest and most secretive trading firms against regulators in the largest equity derivatives market by volume. What happens next will hinge on the findings of SEBI’s further probes into Jane Street’s trading activity as well as the firm’s decision on whether to officially file an appeal.

In its initial order, the regulator said its investigation into the firm’s trades in the options, cash and futures market will continue. The probes will include activity involving the flagship indexes of National Stock Exchange of India Ltd. and BSE Ltd., Bloomberg News reported earlier this month.

On Monday, SEBI said the US firm has requested for “certain conditional restrictions” imposed in SEBI’s interim order to be lifted, the regulator said in a statement Monday. The regulator added that it is reviewing the request.

Jane Street made about 365 billion rupees ($4.3 billion) in overall gains from trading in Indian derivatives and the cash market during the period between January 2023 and March 2025, according to SEBI.

Jane Street told staff on July 6 that it strongly rejected the premise and substance of SEBI’s interim order, and that it was preparing a formal response to the regulator and assessing legal options. The firm said that what the regulator called “intraday index manipulation” was an example of basic index arbitrage trading, a practice common in financial markets.

The New York-based quantitative trader’s next move remains unclear. It can appeal SEBI’s order before the Securities Appellate Tribunal, while also reserving the right to respond to the allegations within the 21 days of the order. If the regulator finds the response satisfactory, it may reverse its interim order. Otherwise, SEBI is expected to issue a confirmatory order outlining a timeline for its probe, before serving a so-called show-cause notice.

SEBI said that Jane Street used its “immense trading, financial and technological prowess” to illegally manipulate markets. It alleged that the company, on weekly index options expiry days, influenced prices in the futures and cash market, and earned huge profits on its options wagers mostly at the expense of individual traders.

Jane Street also traded in India’s cash and equity futures before the ban through a local arm and units registered outside the country, according to SEBI’s order.

The regulator in its order had directed stock exchanges to closely monitor any future dealings and positions of Jane Street and its units, to ensure that they do not directly or indirectly indulge in what it called “manipulative activity.”

Jane Street’s absence has impacted India’s derivatives market, with the value of options traded plunging to a four-month low at the expiration of Nifty 50 Index options on Thursday at NSE. On Monday, shares of BSE jumped as much as 4.5% in Mumbai, while those of Jane Street’s local trading partner Nuvama Wealth Management Ltd. climbed 2.6%.

Moneycontrol earlier reported that Jane Street had deposited the sum, citing people it didn’t identify.

(Updates with more context starting in second paragraph.)

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