Viresh Joshi, the former fund manager and chief trader, Axis Mutual Fund, has moved the Bombay High Court against the fund house for terminating his employment without following proper procedure and claimed damages of ₹54 crore.
Front-running charges
The lawsuit challenges the asset management company move to ‘unfairly terminate’ Joshi’s employment in connection with a suspected front-running case.
The front-running case came out in the open last month when the fund house removed fund manager and chief dealer Viresh Joshi and fund manager Deepak Agrawal in a few of its equity schemes before sacking them from service.
Axis AMC had said it was conducting a suo moto internal investigation since February, using reputed external advisors to assist with the investigation. Further to the investigation, the employment of Viresh Joshi was terminated from May 18.
Joshi’s legal notice
Following this, Joshi sent a legal notice to the fund house.
In his lawsuit, Joshi said that contrary to Axis AMC’s claim of receiving a tip-off from an external source alerting it to the alleged front-running activity, it was he who had first reported his seniors about increased activity in the shares he had been trading on behalf of the fund house last June.
The case timeline
Between November 2021 and January 2022, trading activity in the shares he dealt with, on behalf of the fund house, spiked and led to the fund house starting an investigation, said the lawsuit.
Axis Mutual Fund had logged an average asset under manager of ₹2.60 lakh crore as of March quarter.
Joshi has an experience of 20 years in the capital market and was employed with Axis AMC since 2009. Earlier, he had worked at BNP Paribas Securities and ICICI Securities.
Late last month, market regulator SEBI cracked down on stock brokers who were allegedly linked with the front-running case of Axis Mutual Fund and conducted raids on 16 brokers at 30 locations in Gujarat and Maharashtra.