Jane Street seeks access to key SEBI reports in appeal before SAT

US-based trading firm Jane Street in its plea before the Securities Appellate Tribunal (SAT) on Monday (September 8) sought access to key documents in its ongoing dispute with the Securities and Exchange Board of India (SEBI). The tribunal directed SEBI to respond to the firm’s demand after it alleged that the regulator had withheld crucial reports that had earlier given it a clean chit.Jane Street argued that both SEBI’s own Internal Surveillance Department (ISD) report and a separate National Stock Exchange (NSE) report had exonerated the firm, yet the regulator proceeded to pass an adverse order against it. “Why has SEBI junked its own reports to pass this order?” counsel for Jane Street asked, describing the move as a “volte face.”

According to Jane Street, the NSE report concluded that in 48 out of 53 time slots examined, there was no case of manipulation. Similarly, SEBI’s internal surveillance report said it could not be established that Jane Street had unduly benefited from its trading activity or influenced Bank Nifty, recommending that the matter need not be pursued.

The US high-frequency trading firm told SAT it was “shocked” to discover that these reports predated SEBI’s July order but were not shared with it. SEBI on July 4 temporarily barred Jane Street from the local market on allegations that it manipulated India’s key indexes, in one of the strongest actions it has taken against a foreign investor.
Also read: Jane Street Group restrained from accessing securities market by SEBI, ₹4,843 crore to be impoundedThe firm is now seeking an inspection of internal communications between SEBI and the NSE to determine whether the reports were considered or disregarded, and what triggered the regulator to change its stance after receiving a complaint from a UAE-based trader.

SEBI, however, dismissed the plea as a “fishing expedition” for documents. The capital markets regulator said it had already shared around 10 GB of data with Jane Street and maintained that the investigation was still ongoing. “We cannot disclose further details while the probe is incomplete,” SEBI told the tribunal.

The Tribunal has scheduled a further hearing in the matter on November 18.

Also read: SEBI ramps up Jane Street probe due to inadequate data, continued complaints, says report