Indian market regulator SEBI has issued an interim order against Rajesh Exports Limited, flagging ₹15.15 lakh crore in unverified revenue across foreign subsidiaries. The investigation highlights non-cooperation with forensic auditors, vast reporting gaps against audited Swiss operations, and has led to a trading ban on promoter Rajesh Mehta.
MUMBAI — The Securities and Exchange Board of India (SEBI) has uncovered what could be one of the largest financial discrepancies in the history of the Indian capital markets. In a sweeping 109-page ex parte interim order issued on June 3, 2026, the market regulator alleged that Bengaluru-headquartered gold exporter Rajesh Exports Limited (REL) prima facie misrepresented approximately ₹15.15 lakh crore ($181 billion) in consolidated revenue over five financial years spanning from FY21 to FY25.
The investigation, which initially began with a routine shareholder complaint in 2024 regarding outstanding trade receivables, has exposed an intricate network of unverified foreign subsidiaries, standard accounting deviations, and a documented history of non-cooperation with forensic auditors. The development has sent shockwaves through institutional circles and prompted immediate regulatory references to national auditing watchdogs.
The Core Discrepancy: The Swiss Refining Gap
According to the regulatory findings, the massive financial variance centers on how Rajesh Exports documented its international gold operations. Over the five-year period, the listed Indian parent corporation attributed nearly 99.80% of its consolidated subsidiary revenue—totaling ₹15.18 lakh crore—to its overseas arms.
However, a direct cross-examination of the audited financial statements of Valcambi SA, the prominent Swiss gold refining business owned by the group, revealed that Valcambi reported an actual revenue equivalent to only about ₹3,027 crore during the same window.
The resulting multi-lakh-crore gap exists because Rajesh Exports bypassed Valcambi’s audited statements during corporate consolidation. Instead, the company relied entirely on unaudited, internal data sets compiled by an intermediate holding structure known as Global Gold Refineries AG (GGR) based in Switzerland. Regulators noted that the revenue that made Rajesh Exports appear to be a massive global enterprise sat primarily at the GGR level, which was never independently audited by a certified third party.
Audit Limitations and Non-Cooperation Claims
A forensic audit conducted by BDO India on behalf of the regulator concluded with severe limitations. According to the Forensic Audit Report dated March 25, 2026, the company actively restricted independent verification.
The forensic team detailed that Rajesh Exports did not provide full access to its internal Enterprise Resource Planning (ERP) networks or its core journal entries, shielding underlying transactions from analysis. Furthermore, when requested to produce evidentiary paperwork for transactions totaling over ₹7,021 crore, the company produced complete source documentation for a negligible 2.03% of the sampled value.
In its defense, the management of Rajesh Exports, led by Executive Chairman Rajesh Mehta, initially argued that strict European and Swiss data-protection laws, specifically the Swiss Federal Act on Data Protection, legally barred them from transferring primary corporate records to external foreign investigators. SEBI rejected this rationale, stating that domestic data privacy frameworks do not override basic statutory disclosure mandates required by market regulators to verify consolidated listed entities.
Domestic Anomalies and Promoter Trades
The regulatory paper trail extends beyond European holding structures into domestic equity accounts. SEBI's investigation into the company's standalone operations uncovered over ₹11,400 crore in reported trades between FY22 and FY24 with an entity named Affluence Shares and Stocks Private Limited.
When questioned by investigators, officials from Affluence denied any formal institutional relationship with the listed company. Instead, evidence pointed to the transactions corresponding to personal gold derivative trades executed directly through the individual personal accounts of Rajesh Mehta.
"According to officials, the material available on record indicates systematic misrepresentation of consolidated and standalone financial profiles, the distribution of misleading metrics to public exchanges, and a persistent obstruction of a state-mandated forensic probe."
Market Implications and Investor Fallout
The immediate practical implication for the Indian equity ecosystem is a sharp focus on corporate governance and the validation of "low-margin, high-volume" tech or commodity businesses. Historically, Rajesh Exports puzzled market analysts by reporting massive top-line revenues alongside thin net profit margins of roughly 0.01% and an underperforming Return on Equity (RoE) of 0.6%.
The regulatory order has restricted Rajesh Mehta from purchasing, selling, or dealing in the public securities market until further statutory notice. Furthermore, the market regulator has formally referred the conduct of the statutory auditors to the National Financial Reporting Authority (NFRA) to determine how years of unverified multi-billion-dollar subsidiary books were certified without independent checking.
Key Facts at a Glance
Total Revenue Under Scrutiny: Approximately ₹15.15 lakh crore in consolidated subsidiary revenue reported between FY21 and FY25 is under investigation for lack of primary evidence.
The Valuation Disconnect: Group consolidated revenue was anchored to an unaudited intermediate entity (GGR), while the audited Swiss operating unit (Valcambi) recorded a fraction of the turnover.
Forensic Audit Deficit: Out of a sample of ₹7,021 crore in transactions reviewed by BDO India, only 2.03% possessed complete verification trails.
Regulatory Restrictions: Promoter-Chairman Rajesh Mehta faces an interim ban from active securities trading, and the audit trail has been forwarded to the NFRA.
Current Financial Performance: In its latest earnings filing for Q4 of FY 2025–26, the company reported a net loss of ₹53.50 crores, a steep drop from prior operational quarters.
Frequently Asked Questions
What triggered the investigation into Rajesh Exports?
The probe began following a shareholder grievance filed in March 2024 with SEBI that flagged substantial trade receivables that had remained unpaid and uncollected on the corporate balance sheet for more than two consecutive fiscal years.
Why did the company claim it could not provide subsidiary records?
The company's management asserted that Swiss banking secrecy customs and the Swiss Federal Act on Data Protection legally restricted them from releasing localized financial records belonging to European entities to overseas regulators.
What is the difference between Valcambi and GGR in this case?
Valcambi SA is the actual operational gold refinery in Switzerland whose accounts were formally audited, revealing minimal revenue matching the parent's scale. Global Gold Refineries AG (GGR) is an unaudited intermediate holding hub where Rajesh Exports booked its multi-lakh-crore line items.
Is this a final legal judgment against Rajesh Exports?
No. The 109-page documentation issued by SEBI is an ex parte interim order based on prima facie findings. The corporate entity and its promoters have a designated legal window to file a formal defense and request a personal hearing before a final regulatory ruling is issued.
Source: Official regulatory interim enforcement actions published by the Securities and Exchange Board of India and corporate disclosure listings maintained by the Bombay Stock Exchange.
