Indian authorities have uncovered serious accounting and operational irregularities at Rajesh Exports, one of the largest gold companies in India. The Directorate of Enforcement's investigation follows earlier concerns raised by market regulators regarding the company's reported revenue of over 7.7 trillion rupees ($81 billion) for the previous year.
The investigation found discrepancies totaling 30 billion rupees, insufficient records of foreign transactions, alleged stock manipulation, and an under-reporting of physical gold inventory by approximately 40%.
The Securities and Exchange Board of India previously indicated that 97% to 99% of the company's revenues appeared inflated, describing the revenue gap as 'egregious and unheard of.' Following these revelations, Rajesh Exports' shares fell around 5% and hit the exchange's lower trading limit.
The company's managing director reportedly earned a monthly salary of just 17,000 rupees (around $180), and the chief financial officer has not received a salary since 2020. Rajesh Exports has denied any wrongdoing, asserting that its financial filings are accurate.
This situation raises significant concerns for investors, as it could lead to further regulatory scrutiny and impact the company's reputation and financial stability in the gold sector