Jane Street, a high-frequency trading firm based in the United States, has requested further time from the Securities and Exchange Board of India (SEBI), the Indian market regulator. Jane Street Group told the media in a statement on the evening of July 28 that it is working cooperatively with SEBI and has requested an extension to reply to the July 3 interim decision.
SEBI had given 21 days to respond in its interim order dated July 3. It appears that the extension was requested after this deadline had passed. Jane Street did not reveal the extent of the timeframe extension it has attempted to provide in response to SEBI’s enquiries.
Jane Street promised in the same statement that the group is dedicated to maintaining market integrity. Jane Street is dedicated to actions that preserve the integrity of India’s capital markets and support their ongoing growth, the statement added.
INR 4,843 Crore Market Manipulation Allegation Explained
According to the preliminary inquiry, Jane Street Group illegally gained INR 4,843.5 crore by manipulating trading on Bank Nifty and Nifty Index Options, as SEBI had claimed in its July 3 decision.
Jane Street Group was instructed by SEBI to seize and place the purportedly unlawful proceeds in an interest-bearing escrow account with a lien in SEBI’s favour.
SEBI’s Interim Measures and Jane Street’s Compliance
On July 11, Jane Street complied with Sebi’s instructions regarding the impoundment of alleged unlawful gains. Later, on July 21, SEBI removed the limitations on Jane Street Group’s trading in Indian markets, provided that it refrain from manipulating the market and that exchanges keep a close watch on its transactions.
SEBI’s Broader Crackdown on Market Manipulation
The entities have been instructed to stop and desist from directly or indirectly engaging in any fraudulent, manipulative, or unfair trade practices, as well as from engaging in any activity that may violate current regulations, such as dealing in securities using any of the patterns mentioned or identified in the interim order, according to a statement released by Sebi on July 21. The entities have attested to their intention to adhere to this.
Stock exchanges were instructed to continuously keep a close eye on Jane Street Group’s future transactions and holdings. Therefore, until SEBI’s investigation is finished and any related proceedings are concluded, entities must refrain from engaging in any form of manipulative behaviour, whether directly or indirectly, including dealing in securities using any of the patterns mentioned or identified in the interim order.
Jane Street Group had previously refuted Sebi’s accusations and said that the Indian capital market watchdog had misinterpreted its trading approach.
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