Axis MF says cooperating with regulatory authorities in front-running case

Axis Asset Management has said that it is cooperating with regulatory authorities amid reports of Sebi carrying out 'search and seizure' at several entities in connection with an ongoing probe in the front-running case at the fund house.

The statement comes after reports suggesting that Sebi is carrying out search and seizure operations at several entities including offices of Axis Mutual Fund, stockbrokers, and individuals, as a part of the ongoing investigation into alleged wrongdoings by two former fund managers of the fund house.

In this regard, the fund house said ''Axis AMC continues to work and cooperate with regulatory authorities''.

The fund house said that stringent action in terms of termination of employment has already been taken in respect of two fund managers of equity mutual fund schemes where the AMC has reason to believe that there may have been a violation of securities law.

Earlier, the mutual fund promoted by Axis Bank had terminated its chief trader and fund manager Viresh Joshi on May 18, and fund manager Deepak Agrawal on May 20, who were facing allegations of front-running. It was alleged that the two fund managers allegedly made illicit gains through front-running.

However, Axis AMC did not elaborate on the violations that led to the two fund managers' sacking.

Front-running refers to an illegal practice in the stock market where an entity trades based on advance information from a broker or analyst before the information has been made available to their clients.

Axis AMC, which is one of the leading mutual funds in the country with assets under management to the tune of Rs 2.59 lakh crore is facing allegations of front running and a reported regulatory probe.

(With PTI inputs)