Mumbai: The Securities and Exchange Board of India (SEBI) has barred former Axis Mutual Fund Chief Dealer Viresh Joshi from accessing the securities market for seven years and imposed a monetary penalty of ₹3 crore after concluding its investigation into one of the country’s most closely watched front-running cases. The market regulator announced the action in its final order on Friday, bringing a major enforcement proceeding to a close after more than three years of investigation.
Apart from Joshi, SEBI also took action against 20 other individuals allegedly linked to the front-running network. Depending on the extent of their involvement, these individuals have been prohibited from participating in the securities market for periods ranging from three to seven years. The regulator also imposed financial penalties ranging from ₹10 lakh to ₹1 crore on the noticees.
The case stems from an investigation into suspicious trading activities involving transactions executed on behalf of Axis Mutual Fund between September 1, 2021, and March 31, 2022. SEBI had initially issued an interim order-cum-show cause notice in February 2023 after detecting patterns indicative of front-running. At the time, the regulator estimated that the accused had collectively earned wrongful gains of approximately ₹30.55 crore, an amount that was subsequently impounded.
In its 146-page final order, SEBI concluded that Viresh Joshi, in his capacity as Chief Dealer at Axis Mutual Fund, had access to confidential information regarding the fund house’s impending trades. According to the regulator, Joshi passed this unpublished information to Dubai-based Prijesh Kurani, who allegedly executed front-running transactions through several trading accounts belonging to family members, associates and connected entities.
The regulator observed that the alleged transactions followed a consistent pattern. Positions were reportedly established immediately before Axis Mutual Fund executed large buy or sell orders and closed shortly after the institutional trades influenced market prices. SEBI identified repeated BBS and SSB trading patterns, which allegedly enabled the network to generate unlawful profits.
SEBI further stated that the operation relied on a wider network of intermediaries. Besides Joshi and Kurani, the regulator named Sumit Desai, Pranav Vora and Vaibhav Pandya as individuals who allegedly facilitated the scheme by arranging trading accounts and coordinating communication among the parties involved. According to the order, Visa Capital Partners accounted for the largest share of the alleged illegal gains, earning more than ₹14 crore.
During the proceedings, the noticees denied all allegations. They argued that there was no direct evidence proving that confidential information had been shared by Joshi and challenged SEBI’s reliance on WhatsApp chats, call detail records and witness statements. They also alleged procedural lapses and violations of the principles of natural justice.
However, SEBI rejected these submissions, stating that while no single piece of evidence may have been conclusive, the cumulative material established the existence of a front-running scheme on the legal standard of the preponderance of probabilities. The regulator also clarified that the period already spent under the interim market ban since February 2023 would be adjusted against the final debarment period imposed through the latest order.
