MUMBAI: Searches by the income tax department have allegedly revealed unaccounted deposits worth Rs 55 crore and other investments involving two former employees of Axis MF, brokers and other players, including entry operators. I-T sleuths also found evidence of alleged routing of illegal money by these two entities to foreign tax havens through hawala channels, the finance ministry said in a statement on Friday.
Viresh Joshi and Deepak Agarwal, two former employees of Axis MF, have been under the lens for their alleged role in front-running. But the I-T probe has gone beyond them, although no one has been named in the statement.
According to the release, the tax department on July 28 carried out a “search and seizure operation” on a former fund manager and a chief dealer of equities of Axis MF, along with “related share brokers, middlemen and entry operators”. The operation covered more than 25 places, “spread across Mumbai, Ahmedabad, Vadodara, Bhuj and Kolkata”. During the search operation, the I-T department found various “incriminating evidence”, including documents and digital data, which were seized. “This evidence gathered during the search including sworn statements recorded from various persons have revealed the modus operandi,” the release said.
In mid-May, after internal investigations by Axis MF showed that the two were involved in illegal transactions, both were sacked and the fund house alerted Sebi. The regulator too is probing the activities of the duo. The accused dealer and fund manager used to share specific trade-related information with brokers, middlemen and persons based overseas. These people used those tips for illicit gains from the stock market.
“These persons including family members of the fund manager have admitted in their statements that the unaccounted cash generated from the above operations was routed mainly through Kolkata-based shell entities into their bank accounts. From these bank accounts, funds have been further diverted,” the release said.