Bengaluru | Regulatory pressure has intensified on Rajesh Exports, one of India’s leading gold jewellery exporters, after the Enforcement Directorate (ED) conducted searches at multiple premises linked to the company and its associates. The action comes shortly after the Securities and Exchange Board of India (SEBI) issued an interim order alleging serious financial irregularities involving the company, its chairman Rajesh Mehta and certain related entities.
According to sources, the searches began early Tuesday across several locations in Bengaluru, with investigators examining financial records, fund flows and other documents linked to the company’s operations. While the ED has not officially disclosed the exact basis of the action, the searches are widely believed to be connected to issues highlighted in SEBI’s recent findings.
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In its interim order, SEBI alleged that Rajesh Exports created multiple layers of transactions involving related entities, obscuring the true source and destination of funds. The regulator stated that the structure of these transactions made it difficult to trace the movement of money, raising serious concerns about transparency and the accuracy of the company’s financial disclosures.
SEBI also alleged that the company failed to provide adequate documentation, including loan agreements and board approvals, to justify the routing of corporate funds through the personal bank account of promoter Rajesh Mehta. According to the regulator, between April 2020 and September 2025, the company transferred approximately ₹338.90 crore to Mehta and received around ₹232.44 crore back. SEBI said the routing of funds without clearly identifying their original source prima facie suggested intentional layering and concealment of fund trails.
One of the most significant aspects of the case is SEBI’s allegation that the company’s financial statements contained misstatements totaling approximately ₹15.15 lakh crore. The regulator claimed that the same underlying transactions were repeatedly routed through multiple entities and recorded multiple times, resulting in an artificial inflation of revenue and purchase figures.
However, SEBI clarified that the ₹15.15 lakh crore figure does not represent actual funds that changed hands. Instead, it refers to the cumulative value of accounting entries that were allegedly misstated through repeated recording of circular transactions.
The regulator expressed concern that such accounting practices may have misled investors about the company’s true scale of operations, revenue generation and overall financial health. Pending a detailed investigation, SEBI imposed interim restrictions on the company, its promoters and certain associated entities.
Financial crime experts note that complex corporate structures, layered transactions and multi-entity fund movements are often examined closely by regulators because they can obscure the actual flow of money. Renowned cybercrime expert and former IPS officer Prof. Triveni Singh said that whenever investigators encounter indications of concealed fund trails, regulatory and enforcement agencies typically conduct detailed examinations of banking records, financial statements and digital evidence to determine the true nature of the transactions involved.
The ED’s action has added another layer of scrutiny to the case. Investigators are expected to examine whether the alleged irregularities identified by SEBI point to potential violations involving money laundering or proceeds of crime. While the allegations have drawn significant attention, the company has not accepted the findings and is expected to pursue legal remedies available under the securities law framework.
With the searches still underway, authorities are continuing to analyse documents, electronic records and financial transactions seized during the operation. Further developments are expected as investigators assess the scope of the alleged irregularities and determine whether additional regulatory or enforcement action is warranted.
