A rift has reportedly emerged within an alleged money-laundering network under investigation in Cyprus, as police probe the origins of €545,000 suspected to be proceeds of crime.

The case centres on a convicted inmate, believed to have orchestrated financial operations from inside prison, and a 37-year-old businesswoman alleged to be his partner. Her parents and brother are also under investigation. So far, authorities have seized €238,000 from a bank safety deposit box registered to the woman, in addition to €307,000 discovered earlier.

Police are examining financial records from a family-run jewellery shop and other businesses linked to the suspects, citing unusually high profits.

The ongoing investigation was detailed on Thursday at Nicosia District Court, where police requested an extension of detention for the businesswoman’s parents and brother. During the hearing, investigators revealed signs of a fallout between the inmate and the family. A text message recovered from the mother’s phone allegedly shows the woman writing that the inmate “wants his money back,” following a disagreement.

Despite signs of tension, police said all six individuals — including the inmate, the woman, and her family — remain under investigation. Defence lawyer Elias Stefanou, representing the family, said his clients wish to distance themselves from the inmate, suggesting they may pursue separate legal strategies.

Police initially suspected the funds stemmed from drug trafficking, protection rackets, and illegal betting, but told the court there is no concrete evidence of drug-related crimes, as yet.

According to lead investigator sergeant Makis Nicolaou, the family is being investigated for conspiracy, corruption, unlawful possession of property, and offences under anti-money laundering legislation. The alleged crimes span from January to the present and are believed to have occurred across multiple locations in the Republic.

Intelligence initially pointed to the inmate funnelling roughly €50,000 a week to the businesswoman, allegedly from illegal activities. Police believe the money was distributed across at least five locations, including family residences and the jewellery store.

A €2,000 painting, reportedly gifted by the inmate to the woman’s mother, was among the seized items.

The inmate is said to have maintained regular contact with the woman and another suspect through video calls and messaging apps. During questioning, the woman’s family largely exercised their right to remain silent. However, they acknowledged that the seized funds belonged to her.

The woman’s brother told police that €83,000 found in a travel bag at his apartment had been placed there by his sister, who held a spare key, without telling him what it contained.

The father said he was aware of his daughter’s relationship with the inmate but denied personal contact. He claimed the money came from betting and petrol station businesses — a version disputed by both police and the inmate, who denied owning such businesses.

The mother said she knew the inmate only as someone who gave her daughter expensive gifts and was unaware of any criminal activity. She too cited betting and fuel businesses as his source of wealth.

Police say audits show suspicious income from the woman’s beauty business, and investigators have seized two computers and accounting records from the jewellery shop. Several nightclubs are also being examined for possible links to the case.

In court, the defence argued that the inmate may have been misinterpreted during questioning and that the family simply repeated what he had told them.

They opposed the continued detention of the three family members, contending the case depends on proving the funds came from illegal activities, particularly protection rackets, rather than drugs or gambling.

Police said 41 witness statements have been taken so far, with another 63 expected. The court is expected to rule shortly on the continued detention of the three suspects.

The investigation remains ongoing.