Neteller Founders Arrested

by , Jan 17, 2007 | 7:04 am

As if the UIGEA were not enough … the FBI has arrested two founders of Neteller for allegedly conspiring to transfer illegal funds — crimes committed before the new, tougher anti-online-gambling law even went into effect. Some of you may recall that the Department of Justice has claimed online poker to be illegal all along. Stephen Lawrence and John Lefebvre (Canadian citizens) were both taken into custody on Monday in coordinated arrests in California and the U.S. Virgin Islands.

Both face up to 20 years in prison, as federal prosecutors paint them in a Ken Lay light:

“Blatant violations of U.S. law are not a mere `risk’ to be disclosed to prospective investors,” U.S. Attorney Michael Garcia said in an official statement. “Criminal prosecutions related to online gambling will be pursued even in cases where assets and defendants are positioned outside of the United States.”

Lawrence and Lefebvre led the company when they went public. Trading of Neteller (NLR.L) on the London Stock Exchange was suspended upon word of their arrests.

More information:
The AP/Forbes
The actual legal complaints
A detailed analysis of the charges
Business Week — on what the arrests bode for the online gambling industry

This is a case that, frankly, the poker world is probably prepared to handle. (PartyGaming stock was up 1 percent yesterday.) But the rest of the internet … I fear the non-poker world may not see what is coming. Billions and billions of dollars get transfered around the internet for clearly legal transactions every day. And many of these transactions have long gone untaxed. [colbert]Too long, some would say.[/colbert]

See where this is going? Right now the Feds need us. Online gambling, online poker … ye vile merchants of addiction! Expect the crackdown to continue, because without villains, how else will Uncle Sammy be able to justify trying to take a rake on Al Gore’s invention?

Monday, July 2, marks the day that UIGEA enforcement is supposed to really go into effect — whence it falls on banks and internet service providers to forcibly prevent God-fearing Americans from playing poker online. It’s the same week that the main event of the 2007 WSOP begins.

Can we say interesting time?

6 Comments to “Neteller Founders Arrested”

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  2. Bob

    The Justice Department’s opinion on online gambling (that it all falls within the Wire Act of 1964, sports betting or otherwise) has already been rejected by the courts (US District Court, New Orleans, Feb. 2001, and the US Fifth Circuit Federal Appeals Court). The sports betting aspect has been upheld implicitly by the Supreme Court (in refusing to hear an appeal).

    Sounds like the Justice Department is trying to apply money laundering laws now (again, without defining the “illegal activity”).

    Check this very good article:

    Note, I am no attorney, and no legal advice should be construed here.

  3. Scott Carswell

    Good, those fu**ing clowns don’t even no how to operate a company. I got scammed by them, which led me to hundreds of Google results of other people in my situation. retards

    shady company i hope they get their asses raped

  4. DanM

    Dude, we’ve all kinda forgotten about Neteller. Have they been up to some shenanigans? When/how did you get scammed?

  5. Scott Carswell

    HAHA, i just looked at the date on the post before me… nice! yeah ive been with paypal for 10 years no problems, i shouldnt have even signed up but, forgetting which site it was, they only took neteller.

    meh, I told them to keep the $75.00 and f*!* off after which they emailed me a warning that their site security had been breached and my bank info was accessed (I call bullshit, but i still let my bank know)

    take it easy guys

  6. Kevin Mathers

    Who knew that blog entries could get bumped after 2 years.