1 hr ago
SEBI Shares Trade Logs as Jane Street Challenges Allegations
India’s market regulator, SEBI, accused Jane Street of manipulating prices linked to the Nifty Bank Index.
The regulator says the firm bought many shares while selling options, then sold the shares a few hours later.
It says this helped the firm’s options position and led to unlawful gains.
Jane Street says its trades were ordinary index arbitrage, not manipulation.
SEBI told a court it had given the firm trade logs with times, amounts and prices.
It did not provide the identities and tax details of other traders, saying those records were not used in its investigation.
Jane Street wants additional material, including emails between SEBI and the National Stock Exchange.
The court dispute concerns what information the firm should receive to answer the allegations.
SEBI temporarily barred the firm from trading in India, then lifted the restriction after an escrow deposit.
SEBI told a court it had shared the trade logs used in its preliminary order and urged Jane Street to respond.
SEBI said the logs include trade times, quantities and prices, but omit counterparties’ names and tax identification details.
Jane Street has sought more documents, including communications between SEBI and the National Stock Exchange.
SEBI alleges Jane Street used stock purchases and options sales to influence the Nifty Bank Index and profit from derivatives.
Jane Street denies manipulation; its trading restriction was lifted after it deposited about Rs 4,843 crore in escrow.
- Who
- The Securities and Exchange Board of India (SEBI) and Jane Street Group LLC.
- What
- SEBI said it had shared trade logs supporting its preliminary allegations and asked Jane Street to respond; Jane Street is seeking additional documents.
- Where
- India, in proceedings before a local court; the allegations concern trading linked to the NSE Nifty Bank Index.
- When
- The dispute was discussed at a Monday hearing; Jane Street was expected to present its rebuttal on Thursday. SEBI's interim order was issued July 3 and the restriction was lifted July 18.
- Why
- SEBI alleges Jane Street influenced index-linked stock prices while trading options; Jane Street says its activity was conventional index arbitrage.
SEBI's position
Jane Street's position
Whether the trading was manipulative
SEBI's position
SEBI alleges that Jane Street's stock purchases and options sales influenced Nifty Bank-linked prices and supported its derivatives position.
Jane Street's position
Jane Street denies manipulation and says its activity was conventional index arbitrage.
Access to records
SEBI's position
SEBI says it supplied the trade times, quantities and prices it relied on, and says it need not provide further details about counterparties or communications not used in the probe.
Jane Street's position
Jane Street says much of the shared information was redacted and has sought additional documents, including SEBI-NSE communications, to prepare its defence.
Key facts
- Regulator
- Securities and Exchange Board of India (SEBI)
- Firm
- Jane Street Group LLC, a US-based trading firm
- Alleged gains
- Around Rs 4,843 crore, according to SEBI
- Trade logs provided
- SEBI said it provided trade times, quantities and prices, but withheld counterparties’ names and tax identification details.
- Additional material sought
- Jane Street sought additional documents, including details of as many as 60 emails between SEBI and the National Stock Exchange.
- Trading restriction
- SEBI's temporary restriction was imposed in its July 3 interim order and lifted July 18 after Jane Street deposited the alleged gains in escrow.
- Trades cited by SEBI
- SEBI said Jane Street bought stocks worth more than Rs 43 billion in the cash market over two hours while selling options worth more than Rs 320 billion.
Sources
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