Sebi bans Jane Street entities for alleged expiry-day index manipulation

Markets regulator Sebi has barred US-based trading firm Jane Street from the securities markets and directed the company to disgorge unlawful gains of ₹4,843.57 crore for allegedly manipulating index levels on expiry days to gain massive profits in index options.

JSI Investments, JSI2 Investments Pvt Ltd, Jane Street Singapore Pte Ltd, and Jane Street Asia Trading of Jane Street Group (JS Group) have been prohibited from the markets.

According to an interim order passed by Sebi on Thursday, (July 3, 2025) JS Group entities made over ₹43,289 crore in profits from index options on NSE from January 1, 2023 to March 31, 2025 across all product categories and segments of NSE.

Also, the entities were directed to cease and desist from directly or indirectly engaging in any fraudulent, manipulative or unfair trade practice or undertaking any activity, either directly or indirectly, that may be in breach of norms.

Sebi found the manipulative trading patterns of JS Group early this year. NSE as a first line regulator clearly and explicitly cautioned the JS Group to desist from taking on large risks in the index options markets, and to desist from undertaking trading patterns that raised concerns of manipulative behaviour.

In turn, JS Group themselves represented in February 2025 to NSE of their commitment to adhere to all regulations, the regulator said.

Sebi also noted that JS Group again resorted to undertaking prima facie manipulative ‘extended marking the close’ trading patterns of large and aggressive intervention in index and constituent markets towards the expiry day closing, so as to influence and manipulate the index to their illegal advantage in May 2025, despite a caution letter in February and its own declarations to the NSE.

“Such egregious behaviour, in clear disregard/ defiance of the explicit advisory issued to them by NSE in February 2025, amply demonstrates that unlike the vast majority of Foreign Portfolio Investors and other market participants, JS Group is not a good faith actor that can be, or deserves to be, trusted.

“In the face of such a strong prima facie case that allowing the JS Group to continue as before may severely compromise investor protection on an extraordinary scale, Sebi has a duty to directly intervene,” Sebi’s whole time member Ananth Narayan G said in the order.

Accordingly, Sebi directed the JS Group to disgorge unlawful gains worth ₹4,843.57 crore.