Issue auto-closing not working

Summary

Issue auto closing not working on https://gitlab.demo.i2p.online

Steps to reproduce

On https://gitlab.demo.i2p.online which runs GitLab 12.1.6 through cloud native helm chart, issues could not be automatically closed when merge request with Closes or Fixed is merged.

Example Project

In the MR https://gitlab.demo.i2p.online/xgdemo/minimal-ruby-app/merge_requests/37

What is the current bug behavior?

Closes is interpreted as mentions.

What is the expected correct behavior?

Closes is interpreted as closes.

Relevant logs and/or screenshots

Output of checks

This happens on https://gitlab.demo.i2p.online. @xyzzy can assist to provide access.

Results of GitLab environment info

Expand for output related to GitLab environment info

(For installations with omnibus-gitlab package run and paste the output of:
sudo gitlab-rake gitlab:env:info)
(For installations from source run and paste the output of:
sudo -u git -H bundle exec rake gitlab:env:info RAILS_ENV=production)

Results of GitLab application Check

Expand for output related to the GitLab application check

(For installations with omnibus-gitlab package run and paste the output of:
sudo gitlab-rake gitlab:check SANITIZE=true)
(For installations from source run and paste the output of:
sudo -u git -H bundle exec rake gitlab:check RAILS_ENV=production SANITIZE=true)
(we will only investigate if the tests are passing)

Possible fixes

(If you can, link to the line of code that might be responsible for the problem)