SEBI Alleges ₹15 Lakh Crore Revenue Fraud at Rajesh Exports

India’s market regulator SEBI on June 3 issued a 109-page interim order alleging that Rajesh Exports Limited misrepresented approximately ₹15.15 lakh crore in consolidated revenues across five fiscal years, equal to 99.80% of revenues the Bengaluru-based gold refiner attributed to its overseas subsidiaries between FY 2020-21 and FY 2024-25. The order, passed by SEBI (Securities and Exchange Board of India) Whole Time Member Kamlesh Chandra Varshney, simultaneously barred promoter and Executive Chairman Rajesh Mehta from buying, selling, or dealing in the company’s securities until further orders.

Varshney’s order described the aberrations as “egregious and unheard of.” A Swiss subsidiary that Rajesh Exports publicly named as its principal revenue source posted standalone revenues of under ₹750 crore in any given year, while the consolidated books carried revenues running into trillions of rupees attributed to that same entity. The forensic auditor SEBI commissioned was given access to barely a third of the company’s transaction records.

The Revenue Number Nobody Could Verify

Rajesh Mehta and his brother founded Rajesh Exports in Bengaluru in 1989, building it into a gold manufacturing, export, and retail operation. The company ran SHUBH Jewellers stores across India, claimed a presence in 12 countries, and described itself as the world’s largest processor of gold, handling an estimated 35% of global gold production. Its defining transaction came in 2015: the all-cash acquisition of Valcambi SA, the Swiss precious metals refinery in Balerna, for $400 million from European Gold Refineries. Valcambi is ranked among the world’s largest gold refineries by volume.

Between FY 2020-21 and FY 2024-25, Rajesh Exports reported total consolidated revenues of approximately ₹15.44 lakh crore, placing it among India’s largest companies by turnover on paper. Nearly the entire figure was attributed to overseas subsidiaries. The company’s market capitalisation as of June 3, 2026 stood at ₹3,210 crore, roughly $321 million, a sum smaller than any single year’s revenues in its own consolidated filings.

Shares listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) had already lost more than 40% in 2026 before the order landed. They hit the 5% lower circuit on June 4, closing at ₹104.65 on the BSE. Life Insurance Corporation of India (LIC), the country’s largest state-run insurer, holds approximately 10.8% of the company. Funds managed by Charles Schwab Corporation and Vanguard Group are also among the shareholders, per exchange disclosures.

A Chain of Shells From Bengaluru to Balerna

The subsidiary structure SEBI examined runs in a direct line from India to Singapore to Switzerland. Rajesh Exports Limited in India wholly owns REL Singapore PTE Ltd. That Singapore entity owns Switzerland-based Global Gold Refineries AG (GGR). GGR controls Valcambi SA. SEBI noted that GGR is a holding company with no day-to-day operations. In the company’s own telling, the revenues of a group reporting trillions of rupees in consolidated accounts flowed from a single gold refinery in southern Switzerland.

Between FY21 and FY25, Rajesh Exports reported consolidated revenues of around ₹15.45 lakh crore, with approximately ₹15.18 lakh crore attributed to subsidiaries and step-down subsidiaries. SEBI placed the entities’ revenues alongside each other for comparison:

Rajesh Exports told SEBI the discrepancy reflected a legitimate accounting difference: Valcambi’s standalone accounts recorded only processing charges and value-added income, while GGR recognized the full gross value of gold transactions including the underlying metal. SEBI found that explanation unsupported by any reconciliation statements, accounting opinions, or transaction-level records the company could produce. The order stated that the refinery’s standalone revenues constituted “less than 0.50%” of consolidated revenues reported by GGR and Rajesh Exports, “which appears fundamentally inconsistent with REL’s repeated assertion” that the entity drove the group’s revenues.

Valcambi’s Standalone Accounts

Rajesh Exports also invoked geography as a second line of defense. The company cited Swiss data protection law as grounds for withholding the refinery’s corporate financial records from SEBI. Varshney’s order rejected that directly: Swiss data protection rules apply to personal data of natural persons and cannot be used to block a company from providing its own financial records to a foreign securities regulator.

With both defenses dismissed, the gap between the refinery’s audited standalone accounts and the group’s consolidated revenues had no documentary support. SEBI’s assessment of what that meant for shareholders:

This has created a severe information asymmetry, keeping the public investors and shareholders in the dark regarding the true financial position of REL’s consolidated operations and the veracity of its reported performance.

Varshney wrote those words in SEBI’s June 3 interim ex-parte order, describing five consecutive fiscal years of consolidated reports that investors had no means to independently verify at the subsidiary level. The order identified four additional categories of alleged misrepresentation beyond the headline consolidated gap: standalone revenues misstated by ₹12,557 crore between FY21 and FY24; exchange fluctuation gains and losses wrongly classified as operating revenue; interest income from mutual funds and fixed deposits booked as revenue from operations; and derivative transactions in the promoter’s personal account recorded in the company’s books as its own sales and purchases.

• ₹427 crore to ₹743 crore: Valcambi SA’s standalone revenue range in each year of the five-year period, per SEBI’s order
• Less than 0.50%: What that standalone revenue represented as a share of GGR’s and REL’s consolidated revenues
• ₹15.15 lakh crore: Alleged total misrepresentation attributed to subsidiaries, FY21 to FY25
• ₹12,726 crore: SEBI’s estimate of shareholder wealth erosion linked to the alleged misconduct

The Documents Rajesh Exports Would Not Provide

SEBI appointed an investigating authority in October 2024, roughly seven months after receiving the initial shareholder complaint in March 2024. A forensic audit followed. The auditor requested access to the company’s ERP (enterprise resource planning) systems, books of accounts, and a full journal dump of transactions. That access was denied.

Working without the core accounting systems, the forensic auditor could verify only 35.07% of sales samples, covering ₹12,217.15 crore of transaction value. The rest could not be authenticated. Even within that verified fraction, documentation was incomplete for a significant share of the reviewed samples.

The order also flagged transactions with Affluence Shares and Stocks Private Limited, a Mumbai-based stockbroker. Between FY22 and FY24, Rajesh Exports recorded approximately ₹11,487 crore in sales and ₹11,488 crore in purchases with Affluence, representing roughly two-thirds of the company’s standalone sales and purchases over that period. The near-identical sales and purchase figures meant virtually no commercial value was added across those entries. When SEBI contacted Affluence, the broker denied that Rajesh Exports had ever been its client, stating it had dealt only with the promoter in his personal capacity. SEBI described the Affluence transactions as “fictitious.”

Who Was Trading Gold, and With Whose Money?

The fund diversion allegations carry two different scales. The specific derivatives episode: ₹7.45 crore transferred from Rajesh Exports to the promoter for personal gold derivative trading through his Affluence account. Those trades produced losses of ₹3.50 crore; ₹3.91 crore was later transferred back to the company. Rajesh Exports told SEBI the trades were intended for MCX (Multi Commodity Exchange of India) but were routed through a personal account because of litigation with the exchange. SEBI’s order separately alleged that ₹339 crore in total was transferred from the company to the promoter without board approvals, audit committee approvals, or proper related-party disclosures, of which ₹232 crore was returned.

Managing Director Suresh Gowda told SEBI’s investigators that overseas subsidiaries and step-down subsidiaries were “exclusively handled” by Mehta. SEBI found Mehta was “actively involved” in the financial operations of Rajesh Exports and its subsidiaries.

The Government’s Widening Lens

Ministries in Motion

Rajesh Exports was selected in March 2022 as one of four companies to receive incentives under the government’s PLI scheme for Advanced Chemistry Cell (ACC) battery storage, a programme worth ₹18,100 crore. A government official told the Economic Times that the Ministry of Heavy Industries (MHI) is examining the SEBI order, with “a strong view” inside the ministry that the company should be removed as a beneficiary. The PLI track record at Rajesh Exports already had problems before the SEBI order: the MHI’s own review found the company had erected only a boundary wall and a shed at its proposed battery plant site and had been penalised for missing execution timelines. The company has not received any subsidy under the scheme.

The Ministry of Corporate Affairs (MCA) is coordinating with SEBI and may direct the Registrar of Companies to inspect the firm, according to a government official cited by the Economic Times. Congress media chairman Pawan Khera, at a press conference in Delhi on June 5, alleged the seven-month gap between the March 2024 shareholder complaint and SEBI’s October 2024 investigation appointment allowed investor losses of approximately ₹25,000 crore in market capitalisation erosion. He also questioned why a gold and jewellery company with no battery manufacturing track record received a 5-GW ACC project in March 2022 over seven other bidders with energy storage experience. The BJP and the Centre have not responded to those specific allegations. Separately, Canara Bank has reportedly classified its exposure to Rajesh Exports as a stressed asset, with dues estimated at ₹509 crore, and has initiated steps to auction that exposure.

Orders and Objections

SEBI’s June 3 ruling directed Rajesh Exports and the promoter-chairman to cooperate with investigators and furnish all required documents within 30 days. A new forensic auditor has been appointed, with mandatory ERP access required. SEBI also referred its interim findings to the National Financial Reporting Authority (NFRA), India’s statutory auditing regulator under the Companies Act, for possible action against the company’s statutory auditors, BSD & Co., who signed off on five consecutive years of consolidated financial statements.

• Promoter-chairman barred from buying, selling, or dealing in Rajesh Exports securities until further orders
• Rajesh Exports to furnish all required documents and cooperate with investigators within 30 days
• New forensic auditor appointed, with mandatory access to ERP systems and books of accounts
• Company directed to make “true and fair” disclosures in all financial statements and exchange filings going forward
• Matter referred to NFRA for assessment of potential audit failures by statutory auditors BSD & Co.

Rajesh Exports denied all allegations in exchange filings on June 4 and 5, insisting its revenues were “true and genuine.” The company attributed the Valcambi discrepancy to SEBI mistakenly reviewing the refinery’s EBITDA rather than its revenues, and called the situation “a communication gap and confusion.” Mehta told Moneycontrol on June 4: “It is an interim order and nothing in it is true.” Rajesh Exports and Mehta have 21 days from the June 3 order to file their objections and seek a personal hearing before SEBI.

Frequently Asked Questions

Can investors still trade Rajesh Exports shares on the BSE and NSE?

Yes. Rajesh Exports shares remain listed and tradeable on the BSE and NSE. SEBI’s trading ban applies only to promoter Rajesh Mehta; it does not restrict trading by other investors. The share price closed at ₹109.38 on June 3 and fell to ₹104.65 on the BSE the following session after the order became public.

What does “prima facie” in SEBI’s interim order mean for the case?

A prima facie finding means SEBI has found sufficient evidence on first examination to issue an interim restraint and open formal proceedings. It carries no final legal conclusion of wrongdoing. Rajesh Exports and the promoter have 21 days to file objections and request a personal hearing, after which SEBI will issue final determinations based on the full evidence.

What is the NFRA and what action can it take against BSD & Co.?

The National Financial Reporting Authority is India’s independent auditing regulator established under the Companies Act. It can investigate auditors for professional misconduct, suspend or debar them from practice, and impose financial penalties. SEBI’s referral places BSD & Co. under NFRA scrutiny for their sign-offs on five years of consolidated financial statements that the regulator now says were materially inflated.

What happens to LIC’s approximately 10.8% stake in Rajesh Exports?

LIC retains its shares and faces no regulatory restriction on holding them. The financial impact will depend on the stock price trajectory as proceedings advance. LIC did not respond to media queries at time of publication. Any adverse final finding by SEBI could affect the value of all institutional and retail holdings, though the proceedings will take several months at minimum to reach finality.

What is the PLI scheme and why might Rajesh Exports lose its place in it?

The Production Linked Incentive scheme for Advanced Chemistry Cell battery storage is an ₹18,100-crore government programme administered by the Ministry of Heavy Industries. Rajesh Exports was selected as a beneficiary in March 2022, has not received any subsidy yet, and has already been penalised for missing milestones. The MHI is now examining whether the company’s continued inclusion is appropriate in light of SEBI’s interim findings.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Rajesh Exports Limited is a publicly listed company; the allegations cited here reflect SEBI’s interim, prima facie findings and are subject to further regulatory proceedings and the company’s right of reply. Figures are accurate as of publication on June 6, 2026. Readers considering investment decisions related to the securities mentioned should consult a qualified financial adviser.