Home/ Markets / Sebi bars Axis AMC’s Joshi  from  capital  mkts

Mumbai: The Securities and Exchange Board of India (Sebi), in its interim order on Tuesday, directed impounding of 30 crore made as wrongful gains in the Axis front-running matter.

“An amount of 30 crore being the unlawful gains earned from the prima facie front-running activities is impounded jointly and severally by the noticees," the order said, adding that the wrongful gains have to be deposited in an escrow account of the regulator.

The capital markets regulator also said that the banks are directed to ensure that no debits shall be made without the Sebi’s permission out of the bank accounts held by the entities involved in the matter, except for the purposes of transfer of funds to the escrow account.

Former fund manager Viresh Joshi and 20 other entities have been restrained from accessing capital markets in a 100-page order by the markets regulator.

Essentially, the case pertains to a series of allegations against two executives of Axis Mutual Fund, which include front-running, receiving bribes from brokers and placing trade orders at inflated prices — in complete disregard to investors’ interests.

Front-running includes buying a stock prior to an expected large transaction by a mutual fund that will likely raise the share price.

When mutual funds make a big order, some fund managers buy the same shares in their personal accounts before executing the mutual fund’s order.

Moreover, when these fund houses buy shares in large quantities, the share prices tend to go up.

Priyanka Gawande
Priyanka Gawande is a senior legal correspondent at Mint. She has worked as legal reporter for four years with both television and digital mediums. Based in Mumbai, she reports on disputes across sectors including banking, corporates and finance. This also includes insolvency and bankruptcy cases and intellectual property rights (IPR) litigation. Her focus also comprises tracking capital markets and disputes relating to securities law. Previously, Priyanka worked with Informist Media for 2.5 years covering major insolvency and bankruptcy cases and corporate developments. She started her career in journalism with Business Television India (BTVi) where she reported on primary markets, banking, finance and insurance companies.
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Updated: 01 Mar 2023, 01:49 AM IST
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