Did US Trading Firm Jane Street Deposit Rs 4,843 Crore as Mandated by SEBI?
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Synopsis
In a significant turn of events, Jane Street Group has deposited Rs 4,843.50 crore in compliance with SEBI's regulations after facing a ban for alleged market manipulation. This article delves into the details surrounding this high-stakes trading controversy.
Key Takeaways
- Jane Street Group has deposited Rs 4,843.50 crore as mandated by SEBI.
- SEBI imposed a ban on the firm over allegations of market manipulation.
- The investigation is expected to last 6-9 months.
- Jane Street is a proprietary trading firm utilizing its own capital.
- Allegations include the use of the 'marking the close' strategy.
Mumbai, July 14 (NationPress) The prominent trading firm Jane Street Group, which is based in New York, has reportedly transferred Rs 4,843.50 crore into an escrow account as mandated by the Securities and Exchange Board of India (SEBI). This action was taken after the capital markets regulator prohibited the US-based company from participating in the Indian stock market due to allegations of engaging in manipulative trading practices that purportedly allowed it to gain illegal profits.
Earlier this month, SEBI imposed a ban on the Wall Street firm from trading in India until the stipulated Rs 4,843.5 crore was deposited into an escrow account.
Reports on Monday confirmed that Jane Street has completed the deposit. Neither SEBI nor Jane Street has commented on the reports yet.
In a preliminary order, SEBI claimed that Jane Street was intentionally manipulating market indices through trades that lacked any credible economic justification.
SEBI characterized this as a case of “intra-day index manipulation,” highlighting what it described as aggressive and unhedged positions in Nifty Bank options and other financial instruments.
The ongoing investigation by SEBI is projected to take an additional 6-9 months before a final report and notice are issued to Jane Street.
The market regulator referred to the firm’s actions as “non-neutral trading behavior,” indicating a strategic effort to influence prices rather than simply engaging with the market. This behavior follows a well-documented trading strategy known as “marking the close.”
Jane Street operates as a proprietary trading firm, meaning it utilizes its own capital for trading instead of managing clients’ funds. Allegedly, the firm reaped an astonishing Rs 32,681 crore in profits by manipulating the Indian stock market and transferring the funds abroad.
It is believed that the US firm employed an extensive ‘marking the close’ strategy, executing large and aggressive buy or sell orders near the trading session's end to artificially inflate the closing price of stocks or indices. Subsequently, it allegedly offloaded these stocks through aggressive selling, resulting in a rapid profit while causing prices to plummet, leading to losses for other stockholders.
In response to SEBI’s interim order, Jane Street contested the findings, asserting, “We reject the premise and the substance of the order in the strongest possible terms.”
Point of View
It is crucial to maintain an unbiased perspective while reporting this situation involving Jane Street. The allegations made by SEBI underscore the importance of market integrity and transparency. As we navigate these developments, our commitment to providing accurate and trustworthy information remains unwavering. The potential implications for both local and international investors are significant, and it is essential to monitor how these events unfold.
NationPress
14/07/2025
Frequently Asked Questions
What prompted SEBI to impose a ban on Jane Street?
SEBI imposed a ban on Jane Street due to allegations of manipulative trading practices that purportedly allowed the firm to earn unlawful profits.
What is the amount Jane Street deposited?
Jane Street deposited Rs 4,843.50 crore into an escrow account as mandated by SEBI.
How long is the SEBI investigation expected to take?
The SEBI investigation is anticipated to take another 6-9 months before a final report is issued.
What does 'marking the close' mean?
'Marking the close' refers to a trading strategy where large buy or sell orders are placed near the end of a trading session to influence the closing price of a stock or index.
What is Jane Street's response to SEBI's allegations?
Jane Street has contested SEBI's findings, stating that they reject the premise and substance of the order.
