Interviews for the coveted Whole-Time Member (WTM) position at SEBI are taking place this morning in Delhi, drawing a field of seven shortlisted candidates amid whispers of internal discord at the regulator. The process, managed by the Financial Sector Regulatory Appointments Search Committee (FSRASC), aims to fill two vacancies amid escalating enforcement challenges, including the high-profile Jane Street saga that has tested SEBI's resolve.
The lineup includes four Indian Revenue Service (IRS) officers, two internal SEBI officials, and one additional bureaucrat, each bringing expertise to a role equivalent to Additional Secretary and central to India's $5 trillion securities market oversight.
Yet, as deliberations unfold, eyes are also on the fate of current WTM G. Ananth Narayan – the architect of SEBI's landmark July 2025 interim order against Jane Street – who appears to be facing an unexpected sidelining, despite his decisive action that safeguarded billions for retail investors.
Frontrunner Sundaresan and the Surveillance Angle
VS Sundaresan, SEBI's former Chief Surveillance Officer until early 2025, is widely viewed as the frontrunner. His tenure coincided with Jane Street's aggressive incursions into Indian derivatives, where the U.S. firm built massive Bank Nifty options positions. In 2024 when the Jane Street scandal first got highlighted in a Manhattan court battle, SEBI initially fell short of triggering immediate intervention.
"Sundaresan's surveillance legacy is unmatched for the Jane Street era," said a Mumbai-based compliance expert.
Sidelining of Ananth Narayan: A Solid Order Under Fire?
Adding intrigue, G. Ananth Narayan – the ex-trader turned WTM who personally authored the 105-page July order barring Jane Street – is reportedly not among the shortlist, signaling a possible marginalization despite his role in one of SEBI's boldest enforcement moves.
Narayan, 56, with a pedigree from IIT Bombay, IIM Lucknow, and stints at Deutsche Bank and Citigroup, brought an unparalleled order against the U.S. trading giant. But SEBI has since gone silent after the Jane Street order and is reportedly not following up aggressively on other manipulators, the perception goes. Narayan's order accused Jane Street of a "sinister scheme" involving 18 instances of index manipulation – 15 via intraday distortions and three through "extended marking the close" tactics – netting ₹4,843 crore in unlawful profits at retail's expense.
From January 2023 to March 2025, Jane Street raked in ₹44,358 crore from options while offsetting losses elsewhere, SEBI alleged, distorting Bank Nifty and Nifty levels through aggressive cash-futures interventions with "no standalone economic rationale."
Narayan's ban and disgorgement directive froze remaining assets of Jane Street in India and had barred the group, averting further retail bleed-out in the world's largest derivatives arena by volume – where participation has tripled in five years. However, Nayaran's order had a peculiar directive which said that Jane Street can return to trading once the fine is paid.
"Such egregious behaviour... demonstrates that JS Group is not a good faith actor," Narayan wrote, underscoring the order's ironclad rationale.
Yet, as Jane Street mounts a fierce appeal at the Securities Appellate Tribunal (SAT) – demanding emails between Narayan and colleagues, catching SEBI off-guard in September – sources suggest internal second-guessing has cast a shadow.
Despite the order's robustness – hailed for decoding sophisticated high-frequency plays – Narayan's exclusion from the WTM race hints at bureaucratic crosswinds, possibly tied to the case's fallout or a preference for IRS-heavy profiles. Narayan, known for his "First, do no harm" ethos, has stayed mum, but his sidelining underscores tensions between enforcement hawks and cautious administrators.
A Diverse Slate Amid Broader Reforms
The remaining candidates – the four IRS picks for tax-crime synergy, two SEBI veterans for continuity, and the external bureaucrat for fresh governance – will face grilling on AI fraud, cross-border probes, and expiry-day vulnerabilities. With Pandey's July pledge for "no safe harbor" for manipulators, the appointee(s) will inherit a fortified mandate, potentially building on Narayan's blueprint while navigating SAT scrutiny.Interviews at a fortified Lutyens' venue could yield announcements by late October, filling slots as terms lapse. For a market where retail drives 40% of options volume, today's choices – and the Narayan enigma – could cement or erode trust in equal measure. |
