SEBI has initiated a significant crackdown against US-based trading behemoth Jane Street, alleging that it has been manipulating Indian markets to reap illegal returns. The regulator has suspended four Jane Street-associated entities from trading in India and asked them to give back ₹4,843 crore of suspected unlawful returns.
The company allegedly employed “pump-dump” strategies and expiry-day index manipulation to skew Nifty and Bank Nifty levels and generate gains on options trades. It has rebutted the allegations.
What Is Jane Street?
Jane Street is a proprietary quantitative trading firm established in 2000. Based in the US, it has more than 3,000 employees and offices across 45 countries. Its annual revenue was reported to be $20.5 billion in 2024. Its Asia presence, particularly Hong Kong, is growing very quickly.
How Jane Street is Operated in India?
During the period from January 2023 to March 2025, Jane Street made approximately ₹36,671 crore in India by trading in index options. SEBI has now marked ₹4,843 crore of this amount as illegal.
It initially caught the attention of Indians in 2023 when it sued hedge fund firm Millennium Management in a US court. That action reported Jane Street had made $1 billion in India alone on a high-frequency options trading strategy. Press reports in 2024 raised alarms about its trading conduct, and SEBI began a formal investigation.
What SEBI Found?
SEBI’s interim order accuses Jane Street of manipulating Nifty and Bank Nifty index levels on 21 expiry days between January 2023 and May 2025. The firm allegedly used two main tactics:
Morning Pump, Afternoon Dump: Jane Street bought large volumes of Bank Nifty stocks and futures in the morning, artificially pushing the index up. It then sold aggressively later, dragging the index down and creating misleading price signals.
Expiry Day Index Manipulation: On expiry days for options, it made huge trades close to closing times to distort index levels and affect options prices.
The outcome
- ₹44,358 crore earned from index options
- ₹7,208 crore in stock futures
- ₹191 crore lost in index futures
- ₹288 crore lost in cash market
All these losses notwithstanding, a net profit of ₹36,671 crore was made by Jane Street. SEBI regards ₹4,843 crore of this as illegal and has directed their disgorgement.
Action Taken by SEBI
SEBI has prohibited the following from the securities market:
- JSI Investments
- JSI2 Investments Pvt Ltd
- Jane Street Singapore Pte Ltd
- Jane Street Asia Trading
SEBI has also instructed banks to freeze withdrawals from such firms unless permitted by the regulator. The agency explained that Jane Street persisted in its trading practices even after being given a clear warning by NSE in February 2025. SEBI stated the firm demonstrated “clear disregard” for regulatory supervision and could not be regarded as a “good faith actor.”
