Fmr Axis MF fund manager pays Rs 85.8 lakh to settle market rules violation case with Sebi

Sebi on Monday said it has settled proceedings against Deepak Agrawal, a former fund manager at Axis MF, after he paid Rs 85.8 lakh and surrendered over 43,000 mutual fund units for the alleged violation of market norms.

''...it is hereby ordered that the proceedings initiated against the applicant (Deepak Agrawal vide SCN (Show Cause Notice) dated January 20, 2025, is disposed of in terms of settlement terms,'' Sebi's Quasi Judicial Authority Santosh Shukla said in the order.

The order came after Agrawal proposed to settle the instant proceedings initiated against him, ''without admitting or denying the findings of facts and conclusions of law.'' The Securities and Exchange Board of India (Sebi) had conducted a detailed examination/ inspection covering governance-related aspects of Axis Mutual Fund through a forensic audit for the period April 1, 2020, to September 30, 2022.

The inspection and subsequent show cause notice issued in January this year alleged that Agrawal provided stock tips, divulged specific information about scrips in which schemes of Axis MF took and/or squared off positions.

He also engaged in unethical practices including non-disclosure of directorship in a private limited company and professional misconduct.

According to Sebi, Agrawal had shared the research reports / information intended for the mutual fund with outsiders and passed on information to the employees of listed equity alternatives inducing them to buy / sell securities which were being bought and/or sold by the mutual fund.

Pursuant to filing a settlement application in March this year, Agrawal filed revised settlement terms which was approved by Sebi.

Under the terms, Agrawal paid Rs 85.8 lakh and returned 43,310.73 units held in Axis Quant Fund and Axis Value Fund, which were redeemed and credited back to the respective schemes.

Sebi confirmed receipt of the settlement amount and redemption of units on September 12, as per order.

In its order, the regulator said the case against Deepak Agrawal stands disposed of in terms of the settlement, while reserving the right to reopen action if any representation made during the proceedings is later found untrue or if conditions are breached.

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