The Enforcement Directorate (ED) on Sunday arrested Viresh Gangaram Joshi, former chief trader and fund manager at Axis Mutual Fund, under the anti-money laundering law. He is accused of cheating investors of ₹200 crore through ‘front-running’ in trade activities.
A special PMLA court has remanded Joshi to ED custody till August 8. He was taken into custody on Saturday, the agency confirmed.
According to a media report, front-running refers to an unethical and illegal practice in the securities market in which brokers or traders execute orders for their own benefit using advance knowledge of pending client orders. The arrest follows raids conducted by ED on Friday and Saturday at multiple locations including Ahmedabad, Bhavnagar, Bhuj, Delhi, Mumbai and Kolkata.
The money laundering case stems from an FIR registered by the Mumbai Police in December 2024, alleging that Joshi, the then-fund manager of Axis Mutual Fund, “exploited” confidential information on the trades to be executed on behalf of Axis Mutual Fund to pre-emptively trade stocks, generating substantial “illicit” gains.
“The accused had utilised a terminal in Dubai to punch front-running trade orders through mule trading accounts obtained from brokers.
“In addition to Joshi, the investigation has revealed that many other traders/brokers also misused the advance inputs on Axis Mutual Fund trades and indulged in front-running to generate illicit trade profits, which are nothing but proceeds of crime,” the agency alleged. The ED said it froze shares, mutual funds and bank balance worth Rs 17.4 crore during searches.