Axis Mutual Fund sacks its chief dealer Viresh Joshi who is facing probe for front-running

Axis Mutual Fund, India’s seventh-biggest asset manager by way of pooled cash under management, has sacked its chief dealer Viresh Joshi who is facing probe for suspected irregularities.

“Axis AMC has been conducting a suo moto internal investigation since February 2022, using reputed external advisors to assist with this ongoing investigation. Further to our investigation, his conduct and following the decision to suspend him, the employment of Mr. Viresh Joshi has been terminated with effect from May 18, 2022,” a statement from the fund read.

“Accordingly, Mr. Viresh Joshi ceases to be a Key Person of Axis AMC.”

Axis Mutual Fund had to change fund management of seven schemes after charges of front-running emerged.

In front-running, an illegal market practice, a dealer, trader, or a mutual fund (MF) employee gets wind of a big order (for buying or selling shares) that will be placed by the fund or a big investor and gets ‘in front’ of the trade. Large orders usually have a bearing on the stock price.

Joshi, who has been with Axis since 2009, was the fund house’s chief trader and an equity fund manager. Axis managed assets worth Rs 2.54 lakh crore as on March 31.

The probe found out that Joshi would tell the broker about the shares Axis was about to buy in bulk. After the broker bought the stock, the fund house would buy the stock from the broker at a higher price.

A senior institutional person at a brokerage, who has interacted with Joshi, described him as a “brash individual who enjoyed a good life.” His lifestyle came under scrutiny as it was speculated that he drove a premium sports car, according to an earlier ET report.

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