New Delhi: The Enforcement Directorate has launched sweeping search operations across eight cities in connection with a widening investigation into an alleged front-running scam tied to Axis Mutual Fund. Over the past two days, raids were conducted in Delhi, Mumbai, Gurugram, Ludhiana, Ahmedabad, Bhavnagar, Bhuj, and Kolkata under provisions of the Prevention of Money Laundering Act, 2002.The inquiry follows a First Information Report filed by Mumbai Police in December 2024 against Viresh Gangaram Joshi, the former chief dealer and fund manager at Axis Mutual Fund. Described by investigators as the primary architect of the scheme.
Ex-Fund Manager at Center of Allegations
At the heart of the investigation is Viresh Gangaram Joshi, the former chief dealer and fund manager at Axis. Arrested on August 2, he has been remanded to ED custody until August 8. The case began with a Mumbai Police FIR filed in December 2024. Joshi allegedly exploited confidential trade information from Axis Mutual Fund between 2018 and 2021 to carry out preemptive trades via proxy accounts, netting illicit profits and harming both retail and institutional investors. These acts allegedly cheated retail and institutional investors of the fund, which manages assets worth over Rs 2 lakh crore. The officials revealed that Mr. Joshi operated from a terminal in Dubai, using mule trading accounts sourced from various brokers. This investigation has further uncovered a network of traders and brokers who also exploited pre trade data, generating over Rs 200 crore in illegal profits. Investigators believe the illicit profits were funneled through a web of shell companies and bank accounts tied to the accused and their relatives. During the course of the raids, the Enforcement Directorate froze assets valued at ₹17.4 crore, including equity shares, mutual fund units, and bank balances.
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What Front‑Running Means for India’s Investors
Front-running is a serious securities violation in which insiders trade ahead of client orders using non-public data for financial gain. India’s market regulator and enforcement agencies have deemed these practices corrosive to market fairness and investor trust. Axis Mutual Fund manages over ₹2 lakh crore in assets, with over 1.3 crore investor folios as of March 2025. The case has sparked concerns across the financial community.