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

Techub News reports, according to Cointelegraph, cryptocurrency lending company Nexo Capital has been accused of issuing thousands of loans to California residents without properly assessing borrowers' repayment ability and must pay a $500,000 fine to the California Department of Financial Protection and Innovation.

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