Latest news with #VireshJoshi
Indian Express
3 hours ago
- Business
- Indian Express
Fund manager arrested for ‘front-running' seeks bail, claims company thrived in his tenure
The former chief trader and fund manager of Axis Mutual Fund arrested by the Enforcement Directorate (ED) over allegations of cheating through front-running, has claimed in his bail plea that the mutual fund 'only thrived' during his tenure and that he regularly received 'outstanding' ratings in annual appraisals. Viresh Joshi was arrested on August 2 by the ED ,for allegedly misusing confidential information on trades to be executed on behalf of Axis Mutual Fund to preemptively trade stocks, generating substantial illicit gains, through front-running — an illegal trading practice where a fund manager or broker exploits a non-public impending large investment decision to take a position and benefit from price rise after the large investment. The ED has claimed that it suspects the proceeds of crime to be Rs 300 crore in the case, with Rs 91 crore so far traced to bank accounts of family members of Joshi from various shell companies. 'The applicant's (Joshi) professional conduct throughout his 14-year-tenure at Axis Asset Management Company, (AMC) has been beyond reproach. He consistently met or exceeded performance targets, earning timely promotions from assistant vice president to senior vice president and regularly receiving 'outstanding' ratings in annual appraisals. His integrity and diligence were recognised through multiple internal awards….and invitations to speak at prominent industry forums,' the bail plea filed through lawyer Manan Sanghai said. 'The conduct of the applicant during his tenure more than sufficiently adduces that Axis Mutual Funds only thrived while the applicant was employed with them as is evidenced by the publicly available documents issued by AMF in respect of its own mutual funds scheme,' it said. Joshi further said that all trades were routed only through empanelled brokers and he had no discretion over trade selection, timing or price and operated strictly within a tightly regulated framework. 'The applicant's role was operational in nature and served solely to assist between the fund manager's decision and the said decision's market execution,' the bail plea said. In February 2022, the board of directors of the Axis AMC decided to conduct an internal investigation and all employees were asked to hand over their personal and work email ID with passwords, office computer data, office mobile recorded phones, work from home laptops, personal phones, to an external independent investigator. Joshi was placed under temporary suspension on May 3, 2022, and was terminated on May 18, 2022. Market regulatory authority, Securities and Exchange Board of India (Sebi) had initiated a probe and summoned Joshi. He submitted that he had complied with the summons and his statement was recorded. Sebi passed an interim order in 2023 stating that Joshi was involved in 'front-running', and directions were issued including repayment of alleged illegal gains of Rs 30.56 crore. The bail plea says that the allegations are based on snippets of chat and incomplete trade logs and other data, and is pending finality. Joshi in his plea has said that he has cooperated with the probe, spanning multiple parallel agencies, including the Sebi, EOW, Income Tax department and ED and that he is not a flight risk. The ED has been asked to file a reply.
Indian Express
4 days ago
- Business
- Indian Express
Rs 91 crore credited in family accounts of former fund manager: ED
The Enforcement Directorate (ED), probing the alleged cheating of investors by Viresh Joshi, former chief trader and fund manager of Axis Mutual Fund, has said around Rs 91 crore was credited from shell companies to the bank accounts of his family members. The ED claimed to have details of 31 such accounts involved in the transactions. Joshi was produced before the special court on Friday and was sent to judicial custody after the ED did not press for his further custody for interrogation. The ED remand application in the case alleges that Joshi is associated with members of 'organised crime syndicate' engaged in large-scale front-running. It claimed further that money generated through the illegal practice was layered through various accounts, suspecting the proceeds of crime to be Rs 300 crore. '..the generated proceeds of crime… were routed through the accounts and managed and controlled by Viresh Joshi, including the mule accounts linked to 282 individuals/entities. He subsequently layered and placed the proceeds of crime in his family members' bank accounts and finally used it for acquiring several immovable properties,' the ED claimed, adding that these properties were bought in India and abroad. It alleged that no explanation or documentary proof was provided on the suspected transactions. The ED claimed that as part of his job profile, he was privy to confidential information which he shared for personal gain. Joshi's lawyer Manan Sanghai had told court that the Income-Tax department had frozen assets and his custodial interrogation was needed. It was also submitted that these issues were put before the SEBI in its probe.
The Print
4 days ago
- Business
- The Print
‘Confidential info, Rs 100 crore profit'—ED's case against Axis Mutual Fund ex-dealer Viresh Joshi
These allegations have been documented in the ED's remand application, which was moved before a Special PMLA Court in Mumbai on 2 August to seek his custody. He was sent to judicial custody Friday after the six-day custody of ED got over. Of this amount, his brother received around Rs 33 crore in his account, while Joshi sent around Rs 14 crore abroad for buying properties, the agency further revealed. New Delhi: Former chief dealer of Axis Mutual Fund Viresh Joshi made illegal and unethical use of confidential information about incoming orders to make a profit of at least Rs 100 crore over four years, the Enforcement Directorate (ED) has alleged. The agency also questioned Joshi's brother, Vipul Joshi 7 August, sources aware of the development told ThePrint. The agency's money laundering case stems from an FIR lodged by the Mumbai Police on the complaint of an investor who alleged that Joshi violated trust and ethics by sharing confidential information for personal gain. The Sion police station had booked Joshi and his aides under sections 120-B (criminal conspiracy), r/w sections 34 (common intention), 406 (criminal breach of trust), 417 and 420 (cheating), 465(forgery), 467 (forgery of valuable securities and wills), 468 (forgery of a document for the purpose of cheating) and 477-A (falsification of accounts) of the Indian Penal Code. Months before the FIR, the agency had also carried out searches under the Foreign Exchange Management Act, based on findings by the Securities and Exchange Board of India. It also alleged that Joshi had remitted Rs 14 crore overseas for purchasing properties, including in the United Kingdom. Viresh Joshi's lawyer, Advocate Manan Sanghai, said that all these points were already addressed in the investigation by SEBI in 2023 and that the Income Tax Department had already seized Rs 60 crore alleged to have been transferred to Viresh Joshi's account before it was invested in fixed deposits and Rs 30 crore was already deposited with SEBI. 'This arrest is nothing but high-handedness by the Enforcement Directorate. They are making this case more significant by comparing it to the overall value of the assets under management of Axis Mutual Fund. The Income Tax Department has frozen all alleged proceeds of crime, and there was no need for his custodial interrogation,' Advocate Mannan Sanghai told ThePrint. 'Trading terminal in Dubai, 31 bank accounts & foreign assets' The entire saga began during the COVID-19 pandemic when Joshi, along with other Axis Mutual Fund dealers, were given separate dealing rooms to maintain social distancing. This allowed Joshi to work without any physical supervision, and he also used a mobile number in his office while dealing with this high-value, confidential information, without disclosing it to Axis Mutual Fund, the SEBI found in its probe. Using this information, Joshi had his conduits place bulk orders for stocks planned to be purchased in bulk by big clients and sold them shortly after they rose on the exchange, probably due to the bulk purchase orders. This entire system puts investors, especially retail ones, at a disadvantage as they are not entitled to any such confidential information related to stocks. SEBI found that Joshi approached one of his aides, Sumit Desai, in September 2021, requesting that he arrange trading accounts through which Joshi could place orders. In due course, Desai brought in Dubai-based Prijesh Kurani, whom he had known for five years and Pranav Vora, his known acquaintance for 10 years. Desai asked both of them to provide their service to the overall idea floated by Joshi. Vora was asked to provide trading accounts, and he extended the services of several platforms for the execution of orders eventually placed by Kurani from Dubai, at the instructions of Joshi. The Enforcement Directorate questioned Desai in March earlier this year, and he allegedly confessed to having played a key role in the entire scheme on the instructions of Joshi. 'He also stated that the front was run and business generated on the basis of the sensitive information passed by Mr Viresh Joshi. He further stated that he used to collect the profit share of Mr Viresh Joshi in cash and hand it over to him,' the agency alleged in the remand application, a copy of which ThePrint has seen. The agency claimed that funds amounting to Rs 91 crore were credited into 31 bank accounts of Joshi and his family members, including his father and wife between 2018 to 2022. The agency further claimed that Joshi and other conduits opened several bank accounts in the name of firms, partnerships or in their own names to transfer illicit funds in a systemic manner, including overseas. The agency also found that Vipul Joshi received massive funds in his bank accounts, including Rs 16.57 crore from shell companies and Rs 17.24 crore through self-transfer or transfers by family members, in his five bank accounts. Additionally, the agency claimed that Joshi also controlled around 282 mule accounts, which he used for the seamless transfer of funds illegally acquired from this front-running scheme. Around Rs 29 crore of these funds from Vipul Joshi's accounts were then transferred to the account of Viresh Joshi's controlled firm, Vibgyor Capital Holding Pvt. Ltd. These funds were further invested in a fixed deposit, which the Income Tax Department subsequently seized during their search operation. The agency has further claimed that Joshi transferred Rs 2.4 crore from his bank account to purchase immovable properties abroad. However, these funds were passed on to his account through his family members, who had received funding from shell companies, the agency alleged. The agency allegedly also found a similar transfer of Rs 1.74 crore from his father's account, who allegedly revealed in a statement that his son, Viresh Joshi, was the overall manager of his account. 'The arrestee was enquired with regard to the transactions and operations of mule accounts, however he purposely gave evasive responses and failed to give any justification of the transactions. It is submitted that the funds received by him are in his possession in the form of several immovable properties in India and abroad. However, he failed to provide any satisfactory explanation and submit any documentary evidence to support his claims,' the agency alleged in its remand application. His lawyer, Advocate Sanghai, protested against the request for custodial interrogation, claiming that Rs 91 crore of the alleged proceeds of crime had already been recovered. However, the Special Public Prosecutor argued that Axis Mutual Fund has assets under management (AUM) of Rs 2.5 lakh crore and that the proceeds of crime are suspected to be around Rs 300 crore. Special Judge R.B. Rote ruled that a custodial interrogation was necessary, as the agency sought to investigate the 282 entities whose names had surfaced in the investigation, and that merely the recovery of Rs 91 crore did not conclude the investigation. 'The ED wanted to investigate in respect of 282 entities as reflected in the investigation and confront with the entities as to how the accused operated and generated the proceeds of crime. Further investigation in respect of property purchased cross border from the proceeds of the crime is required. Merely because Rs 91 crore has been recovered, it does not mean that the investigation has been completed,' Judge Rote observed in his order. 'The investigation in respect of the offence of money laundering is distinct and separate and offence of money laundering is a continuing offence. The grounds for ED custody are sufficient and cogent. Without the ED custody, the investigation cannot be completed in a proper manner. Therefore, considering the seriousness and gravity of the offence and the grounds for ED custody, the custodial interrogation of the accused is necessary for the proper and effective investigation of the case,' he further observed. (Edited by Viny Mishra) Also read: India's mutual fund investors have got their 1st taste of a big market shake-up. It's made them cautious
Economic Times
04-08-2025
- Business
- Economic Times
NFO Update: SBI Mutual Fund launches Nifty 1D Rate Liquid ETF
SBI Mutual Fund has announced the launch of SBI NIFTY 1D Rate Liquid ETF – Growth, an open-ended Exchange Traded Fund replicating/tracking NIFTY 1D Rate Index with a relatively low-interest rate risk and relatively low credit risk. The new fund offer or NFO of the fund is open for subscription and will close on August 7. The fund will re-open for continuous sale and repurchase within five business days from the date of allotment. Also Read | Nifty slips into consolidation: What is the right strategy for mutual fund investors now? The investment objective of the scheme is to generate returns, before expenses, that correspond to the returns of the NIFTY 1D Rate Index, subject to tracking error. The scheme would primarily invest a minimum of 95% and a maximum of 100% of its assets in Tri-Party REPOs, Repo in Government Securities, Reverse Repos and any other similar overnight instruments as may be provided by RBI and approved by SEBI and up to 5% in cash and cash equivalents. The fund manager is Jignesh Shah. The fund will be benchmarked against NIFTY 1D Rate Index. The maximum total expense ratio (TER) permissible under Regulation 52 (6) (b) is upto 1%Currently, there are no plans under the Scheme. The scheme offers only growth option. The exit load is nil. The scheme will track Nifty 1 D Rate Index and will use a 'passive' or indexing approach to endeavour to achieve the scheme's investment objective. The fund manager's endeavor would be to rebalance the portfolio in order to mirror the index; however, there may be a short period where the constituents of the portfolio may differ from that of the asset allocation of the scheme. Also Read | Axis Mutual Fund message to investors after Viresh Joshi's arrest In case of any deviation from the asset allocation pattern, the portfolio shall be rebalanced by AMC within 7 days from the date of said deviationThe fund is suitable for investors seeking short term income solutions and want investment in securities covered by NIFTY 1D Rate index. (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
Khaleej Times
04-08-2025
- Business
- Khaleej Times
Fund manager arrested in India in multi-million-dirham scam linked to Dubai terminal
India's financial crime agency has arrested a former fund manager from Axis Mutual Fund in connection with a major front-running scheme linked to a Dubai-based trading terminal, the Enforcement Directorate (ED) said on Sunday (August 3). Viresh Joshi, the former chief trader at Axis Mutual Fund — one of India's largest asset management firms — was arrested on August 2, under the Prevention of Money Laundering Act (PMLA). A special court has ordered that he remain in ED custody until August 8. The arrest comes after a series of nationwide raids conducted by the ED on August 1 and 2, targeting multiple locations across India including Mumbai, Delhi, Gurugram, Ludhiana, Ahmedabad, Bhuj, Bhavnagar, and Kolkata. During these operations, authorities froze assets suspected to be proceeds of crime, including mutual funds, shares, and bank balances worth approximately Dh7.4 million. Axis Mutual Fund, part of the Axis Bank Group, manages over Dh85 billion in assets for both retail and institutional investors. According to the ED, Joshi misused confidential trading data between 2018 and 2021 to place pre-emptive trades through mule accounts, a practice known as front-running. He allegedly shared this non-public information with brokers who had access to a trading terminal in Dubai, enabling them to execute trades on his instructions and pay him kickbacks in cash. In a previous press release, ED stated that two overseas entities, including one incorporated in Dubai, were set up using embezzled funds. The proceeds were allegedly used to acquire immovable properties in the UK and form fixed deposits and investments in India, the ED said. Veteran Dubai-based investor Shankar Sharma, founder of GQuant Investech, said he hoped the case would be pursued to its conclusion. 'Market integrity depends on how decisively such violations are dealt with,' Sharma told Khaleej Times. Front-running is an illegal market practice where traders exploit advance knowledge of large client trades for personal gain. It is considered a serious breach of investor trust and is banned under Indian securities law.
