Yes indeed, the VR needs a good frame ground to complete the regulated field current circuit plus operate the shunt winding portion of the Cutout Relay.
Check that frame ground connection and have the junctions clean n shiny bright.
However, I guess there could also be a short causing the problem as the VR"s BAT terminal has hot battery voltage going inside to the Cutout Relay. Such a short might draw higher curent then those noted above!!
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