The finding from the Accounts Chamber of the Russian Federation follows Prime Minister Vladimir Putin’s calls in July last year that Mechel was avoiding taxes and selling coking coal to affiliated Swiss companies at a quarter of the world price at the time.

According to Bloomberg, the chamber discovered that offshore registered trading companies were generating considerable revenues with Russian producers selling coal at a discount of 30-54% to world prices.

The government agency reportedly said the grade and quality of those exports were being ignored by customs officials, and also stated the Russian budget was losing significant tax revenues.

Russia was the fourth-largest coal producing nation last year, according to British Petroleum’s annual statistical energy review, accounting for 4.6% of global output.

Mechel’s fortunes have been on a downward trajectory since Putin’s comments and the debt-laden company recently announced there was substantial doubt about its ability to continue as a going concern.

Fellow Russian steelmaker and coal producer Evraz Group has also started cutting costs, slicing net debt by $US1 billion to $8 billion as of the end of March.