Bulgarian Authorities Probe Nexo for Money Laundering

The Bulgarian government recently launched a full-scale raid on 15 sites connected to the alleged illegal activity carried out by Nexo.

The Bulgarian government has initiated a probe into the activities of crypto lender Nexo, alleging that the digital asset financial institution might have been involved in illegal criminal activities bordering on money laundering, tax evasion crimes, unlicensed banking activities, and computer-related fraud.

The authorities have linked Nexo’s activities with Ruja Ignatova, a Bulgarian-born convicted criminal from Germany often referred to as “The Queen of Cryptocurrencies,” the government alleged that the company’s officials were involved in Ignatova’s crypto-related pyramid scheme OneCoin which she established in 2014.

The government recently raided over 15 sites in Bulgaria’s capital and largest city Sofia. “In Sofia, active steps are being carried out as part of a pre-trial investigation aimed at neutralising an illegal criminal activity of crypto lender Nexo,” Siyka Mileva, a spokesperson for the Bulgarian prosecutor’s office told local media.

“It has been established that the main organizers of the international platform are Bulgarian citizens and the main activities are from Bulgarian territory,” Mileva added. She revealed that over 300 personnel from the Bulgarian National Investigation Office and the State Agency for National Security (SANS), along with foreign agents, have launched a full-scale search of Nexo offices within the country as part of the investigation.

The probe into the crypto lender kicked off a few months back after foreign entities discovered suspicious transactions carried out on the lender’s platform. The activities were allegedly aimed at bypassing the international financial sanctions placed on Russia by the West. The authorities allege that Nexo’s activities have been carried out under numerous firms.

Nexo Says it Adheres to AML Policies

Nexo recently made a thread of tweets, claiming that they have constantly adhered to Anti-Money Laundering (AML) Know-Your-Customer (KYC) policies, stating that they have always met international regulatory standards. Notwithstanding, the disclosure did not directly address the recent reports.

“Unfortunately, with the recent regulatory crackdown on crypto, some regulators have recently adopted the kick first, ask questions later approach. In corrupt countries, it is bordering with racketeering, but that too shall pass. We are always cooperating with the relevant authorities and regulators,” Nexo concluded.

Recall that U.S. authorities filed a lawsuit against Nexo last year for suspending support for XRP without prior notification to its users. The authorities partially dismissed the class action last August.