London-based crypto lender, Nexo (NEXO) has closed two of its subsidiaries in the United Kingdom as part of a company-wide restructuring. Nexo Financial Services Ltd. and Nexo Clearing and Custody Ltd. were shut down on May 11th, according to Bloomberg News.
Investigation into Organized Crime Scheme in Bulgaria
Bulgarian authorities are investigating Nexo for allegedly being involved in an organized crime scheme. In January, Nexo’s offices in Sofia were raided by Bulgarian authorities. In February, four Nexo employees were charged with forming an organized crime group and committing money laundering, unlicensed banking activities, and tax and computer crimes.
Nexo Co-Founder Denies Exit from UK Market
Nexo’s Co-founder Antoni Trenchev denied that the company’s decision to shut down its UK subsidiaries was due to an exit from the UK market. Instead, Trenchev claimed the closure was part of a company-wide restructuring that aimed to rethink the way Nexo services its clients.
SEC Charges Nexo for Failure to Register Retail Lending Product
In addition to the ongoing investigations in Bulgaria, Nexo has faced legal disputes in the United States. The US Securities and Exchange Commission (SEC) fined Nexo $22.5 million for failing to register its retail lending product. Nexo settled with the SEC in January, paying $45 million in fines.
Despite the legal challenges faced by Nexo, it remains committed to serving its clients globally. The company has not announced any plans to exit any of its markets, including the UK.