Shares in Nuix Ltd (ASX: NXL) have fallen today following news the company’s Sydney offices have been raided by law enforcement. At close of trading, the Nuix share price was down 1.92%, with shares swapping hands for $2.56.
Nuix announced it had received a search warrant from an unnamed body at around 11.30 am this morning. Until then, its shares had been enjoying a day in the green. An hour later, The Nuix share price had fallen by 3.97%.
Let’s take a closer look at what law enforcement might be doing in the software company’s office.
According to Nuix’s release, a warrant was issued today to search the company’s Sydney office.
The warrant’s issuer is seeking documents relating to an individual’s affairs. Nuix didn’t name the individual.
Nuix stated the warrant was nothing to do with wrongdoing by the company.
According to reporting by the Australian Financial Review (AFR), the Australian Federal Police (AFP) issued the warrant.
The AFP is reportedly assisting the Australian Securities and Investment Commission (ASIC) in its criminal investigation into Nuix.
The AFR reported the criminal investigation is related to Nuix’s initial public offering (IPO).
As The Motley Fool Australia has previously reported, the corporate watchdog is said to be investigating Nuix and its major shareholder Macquarie Group Ltd (ASX: MQG) over allegations Nuix’s prospectus included inflated forecasts. The investigation reportedly began earlier this month.
ASIC was blasted in Parliament last week over its alleged failure to regulate the software company’s IPO, which resulted in investors losing nearly $3 billion.
Additionally, the AFP began investigating Nuix’s co-founder and former-chair Tony Castagna last month. The investigation relates to an options package reportedly sold to Castagna by Nuix that could have been backdated. The options are said to have been cashed out for $80 million at Nuix’s float.
Nuix share price snapshot
Once hailed as the ASX’s future market darling, Nuix has turned out to be one of its most nail-biting rollercoasters.
Currently, the Nuix share price is 68% lower than it was when it debuted on the ASX in December 2020.
The company has a market capitalisation of around $828 million, with approximately 317 million shares outstanding.