SEBI ban: Jane Street deposits Rs 4,843 crore in escrow accounts

Stock manipulation case: The global proprietary trading giant Jane Street has deposited $567 million or Rs 4,843.5 crore in escrow accounts in compliance with directives from the Securities and Exchange Board of India (SEBI) on Monday.

SEBI said the action has been undertaken by Jane Street entities, without prejudice to their rights and remedies, which remain available to them in law and equity. The markets regulator said Jane Street has requested SEBI that, following the creation of this escrow account in compliance with SEBI directions, certain conditional restrictions imposed under the interim order be lifted and that SEBI issue appropriate directions in this regard.

"This request is currently under examination by SEBI in accordance with the directions of the interim order," the exchange said. 

To recall, SEBI in its interim order prohibited the New York-headquartered firm and its entities from buying, selling, or otherwise dealing in securities, directly or indirectly. As per the order, the unlawful gains earned by the JS Group entities, from the alleged violations, amounting to Rs 4,843 crore, were to be impounded and the entities were directed to open an escrow account in a scheduled commercial bank in India to deposit these unlawful gains.

SEBI had also directed stock exchanges to closely monitor any future dealings and positions of JS Group on an ongoing basis, to ensure that its entities do not either directly or indirectly indulge in any kind of "manipulative activity", including by dealing in securities using any of the patterns identified or alluded to in this
order, till the completion of the investigation by SEBI and the consequent proceedings, if any. 

Jane Street Group had expressed its disagreement with SEBI regarding the latter's interim order, as it impacted several of Jane Street entities, including JSI Investments Private Ltd and Jane Street Singapore Pte. Ltd.

Jane Street has no intention to trade in Indian options, one of the sources told Reuters today. "The money has been deposited in good faith. The firm continues to contest the order and will send a formal response rebutting the allegations in coming weeks," said the second source.

Jane Street operated in both cash and derivatives markets as a Foreign Portfolio Investor (FPI) and as a trading member, meaning its volumes were reflected in both FPI and proprietary categories.

"Since the regulatory inquiry was already in progress, its trading activity had already declined over the past few months. According to exchange data, FPIs account for 3–8 per cent of equity derivatives turnover, while proprietary traders contribute 60–65 per cent; the remainder comes from individuals and others," Jefferies noted.

Options trading in India fell to a four-month low following Jane Street Group's trading ban. The NSE reported a 40 per cent drop in derivatives premiums than the year's average for such days. The US-based trading firm, as per another report, is now cleared to resume operations in the Indian equity markets, having met a key requirement outlined in Sebi’s interim order dated July 3, 2025.

For BSE, derivatives drive 58 per cent of FY26 revenues. In this segment, FPIs drive 3-4 per cent of turnover, and Jefferies estimates that contribution from Jane Street would be a smaller subset of that ( 1 per cent).

Despite the recent ban, Jane Street recently suggested it was cooperating fully with SEBI, affirming its commitment to regulatory compliance globally.

“Jane Street remains committed to complying with all applicable regulations in every region where we operate,” Jane Street said earlier in an emailed statement to Reuters.

SEBI’s directive followed SEBI’s findings of alleged manipulation in the Bank Nifty index, which includes major Indian banking stocks. Preliminary observations point to a complex and unlawful trading pattern, allegedly enabled by Jane Street’s sophisticated trading infrastructure.