SEBI vs Jane Street: ₹4,843 Cr Escrow Marks Start of Legal Battle

by Priya

Posted on July 15, 2025

Jane Street’s ₹4,843.6 Crore Escrow Deposit: Context and Latest Developments

Background

• Jane Street, a US-based global trading firm, recently deposited over ₹4,843 crore in an escrow account in India. This move follows an interim order issued by SEBI (Securities and Exchange Board of India) on July 3, 2025.
• The order came after SEBI alleged that Jane Street manipulated the Bank Nifty index and related derivatives between January 2023 and May 2025, resulting in “unlawful gains” estimated at ₹4,843.6 crore.
• SEBI’s probe found that Jane Street’s activities included buying large quantities of Bank Nifty constituents in the cash and futures markets to artificially support the index, while simultaneously taking large short positions in index options.

Key Actions Taken

• Escrow Deposit: Jane Street deposited ₹4,843.6 crore (~$567 million) in an escrow account with a lien in favor of SEBI, as directed.
• Trading Ban: Along with the escrow requirement, SEBI imposed a ban on Jane Street and its entities, preventing them from trading in Indian securities markets until the firm complied with the order.
• Appeal and Position: Jane Street has stated that the deposit was made “without prejudice to their rights and remedies,” indicating their intention to formally contest SEBI’s findings and retain their right to legal recourse.

Current Status

• Request to Lift Restrictions: After making the escrow deposit, Jane Street has formally requested that SEBI lift certain conditions and trading restrictions imposed in the interim order. This request is currently under review by SEBI.
• Market Impact: The ban and investigation have affected participation in India’s derivatives market, with Jane Street being a significant provider of liquidity in these segments.
• Future Steps: Jane Street is expected to appeal SEBI’s interim order at the Securities Appellate Tribunal, arguing that its trading strategies were legitimate and standard for high-frequency liquidity providers.

Key Details Table

Summary

Jane Street’s deposit of ₹4,843.6 crore into escrow is a procedural step complying with SEBI’s directive following allegations of market manipulation. While the escrow fulfills a key compliance condition, Jane Street firmly contests the regulator’s findings and seeks to restore its trading privileges. SEBI is currently examining the firm’s application to lift the imposed restrictions, with further legal proceedings anticipated.

Ref: Jane Street complies With Sebi, deposits Rs 4,843 crore in escrow account