NetTeller arrests

[2Tone]

Whoa.



NETELLER BREAKING NEWS


Leading payment processor Neteller has sought the temporary suspension of its shares after it emerged that two former directors had been arrested in the US.

Stephen Lawrence and John Lefebvre were detained by the US authorities while travelling separately. It is believed at least one was arrested in Los Angeles.

In a statement, Neteller said neither Lawrence or Lefebvre had any current position within the company. It added: “The group has not received any communication or correspondence from any US authority regarding this or any related matter.”

Lebebvre left Neteller in December 2005 while Lawrence left in October last year, just after the passing of the Unlawful Internet Gambling Enforcement Act. Lebebvre and Lawrence each own approximately 5% of the company's capital.

It is not known whether they have been arrested by state or Federal authorities.

eGaming Review will update as soon as more is known.

[Spuddy]

Interesting.........


Wonder if Netteller will shut down?

[Talking Poker]

Whoa is right.

[Talking Poker]

More:





If (and this is a HUGE if at this point) Neteller pulls out of the U.S. market........ well, that would be bad.

[lightfungus]

Ack

[2Tone]

Also, don't miss the last paragraph



Neteller BREAKING NEWS UPDATE

Neteller founders Stephen Lawrence and John Lefebvre have been charged with money laundering offences by the US Attorney General in the Southern District of New York.

A statement from the office of Michael Garcia added that Lawrence and Lefebvre had been arrested in connection with the “creation and operation of an internet payment services company that facilitated the transfer of billions of dollars of illegal gambling proceeds from US citizens to the owners of various internet gambling companies located overseas”.

Lawrence and Lefebvre were arrested in the early hours of Monday morning, January 15. Lawrence was arrested yesterday in the US Virgin Islands and will be presented in federal court in St Thomas by tomorrow. Lefebvre was arrested in Malibu, California, and will be presented in a Los Angeles court later today.

Neteller suspended its share price this morning as the news broke.

In a statement released earlier today, Neteller said neither Lawrence or Lefebvre had any current position within the company. The statement added: “The group has not received any communication or correspondence from any US authority regarding this or any related matter.”

Lebebvre left Neteller in December 2005 while Lawrence left in October last year, just after the passing of the Unlawful Internet Gaming Enforcement Act (UIGEA).

The news of the Neteller arrests spelt more bad news for those operators that have not exited the US.

Said one legal source: “It’s a warning shot across the bows for those still taking money from the US.”

He added: “They are aiming their strategy at the finance provision. It is consistent with the UIGEA. It is a more effective strategy than going after the operators themselves, such as PokerStars. When you get the money providers, you get the portfolio of operators.”

One leading operator suggested this was particularly bad news for those poker operators that remain in the US market. “This could be terminal for the poker business in the US. The average punter will not be willing to jump through the hoops (to get their payments through).”

[Reel Deal]

At this point, this makes no sense if they both are nothing more than shareholders. Strange.

[Kurn]

This either has nothing to do with the UIGEA or nothing to do with NETeller.

Both men left their employment of NETeller either prior to or right at the signing of the legislation. Since Article I, Section 9 of the US Constitution explicitly forbids ex post facto laws, they can't be arrested for any transactions they did while employed by NETeller that were not illegal at the time.

If this is about their activities since the passage of UIGEA, it cannot involve NETeller since they didn't work there.

Now, on the other hand, there are many other forms of money laundering that might occur that would have been illegal even if the US had completely legalized internet gambling, so I think we need to wait until all the facts come out before we panic.

[Reel Deal]

From CardPlayer.com

FBI Arrests Former NETELLER Executives
Stephen Lawrence and John Lefebvre Detained while Traveling Separately
Two former NETELLER executives were detained while traveling separately through the United States yesterday (Jan. 15) in "connection with the creation and operation of an Internet payment services company that facilitated the transfer of billions of dollars of illegal gambling proceeds from United States citizens to the owners of various Internet gambling companies located overseas," according to the U.S. Attorney General's office of Southern New York.

NETELLER suspended trading its shares on the London Stock Exchange in lieu of the detention of founding members Stephen Lawrence and John Lefebvre. Besides owning stock in NETELLER, the two do not hold any positions with the company.

NETELLER is an “e-Wallet” service that allows people to transfer money directly from their bank accounts to other parties. It’s the main service many online poker players and gamblers use to transfer money in and out of their preferred sites.

Here’s the complete release from the U.S. Attorney’s office:

"U.S. Charges Two Founders of Payment Services Company with Laundering Billions of Dollars of Internet Gambling Proceeds

Michael J. Garcia, the United States Attorney for the Southern District of New York, and Mark J. Mershon, the Assistant Director in charge of the New York office of the Federal Bureau of Investigation, announced today that Stephen Eric Lawrence and John David Lefebvre were arrested yesterday in connection with the creation and operation of an Internet payment services company that facilitated the transfer of billions of dollars of illegal gambling proceeds from United States citizens to the owners of various Internet gambling companies located overseas."

NETELLER says it hasn’t received any kind of correspondence from the U.S. government concerning this situation, and although the subject line of this email (sent by a media representative of the AG's office) says they were charged with money laundering, CardPlayer.com is working on confirming the exact charges.

Lawrence and Lefebvre each own close to 6 percent of the company’s shares. Lawrence resigned as a non-executive director of the company in October; Lefebvre resigned from the same position in December of 2005.

Although Lefebvre and Lawrence do not and never have owned an online gambling site, they join a small club of men who have been arrested and charged by the Federal Government for violating various laws concerning online gambling, particularly money laundering.


Executives with online gambling companies Sportingbet and BetOnSports were arrested and charged with taking bets over the Internet (among other charges) in 2006, but this is the first time people affiliated with an “e-Wallet” have been targeted.

In October, President George W. Bush signed into law the Unlawful Internet Gambling Enforcement Act, which is designed to curb online gambling by targeting banks that cooperate with online sites. The Treasury Department is still working out the details on how to enforce this law, and have until summer to do so.

NETELLER is based in the Isle of Man, and neither Lawrence nor Lefebvre are U.S. citizens.

Please click here to visit CardPlayer.com’s special section on the law and the Internet.

[X-Longshot-X]

Fuck

[GTDawg]

Kurn mentions the points I was going to make.

Involving the UIGEA and involving NETeller are mutually exclusive events in this situation.
The wording of the above article is sketchy at best.

[Kurn]

The bold part above sounds to me like the feds have some evidence the accused have some connection to some US-based bookmaking operations and knowingly facilitated the transfer of funds from those operations to online sites thus enabling the initial depositors to repatriate the cash at a later date and make it look clean.

Just a guess, but that's what the language there suggests to me.

[Reel Deal]

If they don't have some evidence along the lines that Kurn is suggesting then they are going to have a hard time making this stick.

[GeoffM]

Sorry guys, give me a quick breakdown of what's going on here, I don't have time as I'm at work. Will I need to start emptying out the neteller account into Stars and Tilt?

[MAYHEM45]

Yeah. Get money out now?

[Talking Poker]

I see absolutely no reason to panic. Even if Neteller decides to discontinue business with the U.S. (worst case scenario), they aren't going to steal your money. You'll still be allowed to withdraw it. If you feel safer having your money on Stars (for example), then go for it.... but remember, just a few month ago, the Chicken Little's were all withdrawing their money from Stars because they thought it was safer on Neteller.

[MAYHEM45]

Meh I put some on stars and cashed the rest out to my bank account, which I was gonna do anyway, better to be earning interest on it. And if I need money on some random site quick, Full Tilt takes less than an hour to cash out to neteller. Better safe than sorry.

[Reel Deal]

I think one important thing to find out (not sure if I've seen the answer to this) is whether they were granted their request to suspend trading on their shares on the London Footsie. If that wasn't granted and the stock tanks tomorrow, well then things could get interesting. I imagine it was granted though.

[Talking Poker]

Wait... you're in Canada. What are you worried about?

[Boobie Lover]

I'm pretty sure if US customers get screwed out their money, everyone in the world is going to get screwed out of their money. It's not like Neteller is going to seize all the US money, but yet still allow Brits to process funds through there. I'm not saying that the possiblility of losing money from Neteller is even .000001% likely, but your logic is sort of faulty.

[Talking Poker]

First of all, Neteller isn't going to "seize money" from anyone. They are a legitimate, profitable business and would remain so even without dealing with the U.S. market. There is no reason to close up shop if they decide not to deal with U.S. customers any more. It's similar to how Party Poker didn't screw anyone out of the money in their accounts and is still open for business with the rest of the world.

But just for kicks, let's say that Neteller - a publicly traded company that makes gobs and gobs of money from their non-U.S. customers - decided they DID want to screw the world over and steal as much money as possible before disappearing to.... somewhere... (Good luck with that). Anyway, if they were going to do that, don't you think they'd empty your bank account first? You know, the one that you have linked to your Neteller account? I mean, why not?

It's ridiculous, and it's not going to happen. Your .000001% estimate is way high.

[2Tone]

I agree that NetTeller it is extremely unlikely to abscond with people’s money. It not like major companies don’t sometime practice theft and/or criminal acts as a matter of policy – Enron, anyone? – but I don’t think that is going to happen in this case.

What I do suspect will happen is that Netteller will pull out of the US market. They warn of this possibility in their latest filing

and that will likely have very chilling effect on online poker.

I’m very curious about ...
Whether it was NetTeller other activity that got these guys busted. To me “an Internet payment services company that facilitated the transfer of billions of dollars of illegal gambling proceeds from United States citizens to the owners of various Internet gambling companies located overseas” sure sound like NetTeller. Is any other service moving billions (with a ‘B’) of dollars?

What impact this will have on the WSOP/Poker Expo/pro endorsements? I can’t imagine any Stars/Full Tilt officers would be willing to set foot in the US right now. Where does leave Doyle and Full Title pros? Doyle especially seems vulnerable. And will the sites shell out major marketing dollars for their .net ‘schools’ at the Expo next year?

[Boobie Lover]

My point wasn't that money would get seized, it was that IF (even though the possibility is close to nil) it would, EVERYONE would be fucked. So, saying, "you are canadian, what are you worried about?" is pretty much the same as saying "you are a US citizen, what are you worried about?"

[Talking Poker]

Don't forget about affiliates - the potential impact on guys like me.

Right now, they seem to be going after the obvious (BIG) targets to stop the flow of money.... but who knows what the future holds?

It really is a shame the U.S. is handling this all so poorly.

[Talking Poker]

Well, I wasn't addressing the paranoid "what if they steal all your money" issue. I was addressing the "If they pull out of the U.S. market, having money there could cause a headache for U.S. customers who need to find a way to get it back - especially if they make everyone take a check and then you can't get your money from there (the check) back to your favorite poker sites easily" issue. This obviously wouldn't be a problem for non-U.S. citizens.