Nexo fined $500,000 by California regulators for "high-risk loans"

According to Cointelegraph, cryptocurrency lending company Nexo Capital will pay a $500,000 fine to the California Department of Financial Protection and Innovation. The regulator accused the company of issuing thousands of loans to California residents without holding a valid license and failing to properly assess borrowers' ability to repay.

The regulator stated that from July 2018 to November 2022, Nexo issued at least 5,456 consumer and business loans to California residents without a valid loan license, and typically did not assess borrowers' repayment ability, existing debts, or credit history before lending. Nexo must transfer all funds of California customers to its U.S. affiliate Nexo Financial LLC, which holds a California loan license, within 150 days.