Citadel funds seized

[yahboohoo]

Casino City Times (http://www.casinocitytimes.com/news/article.cfm?contentID=166088) article

Citadel funds seized
By Aaron Todd
18 May 2007

The U.S. Department of Justice has seized $9.25 million in funds from Citadel Commerce, a third-party payment processor that had previously allowed U.S. residents to conduct financial transactions with Internet gambling companies. The Canadian-based company stopped processing U.S. gaming transactions in January, almost immediately after its competitor, NETeller, withdrew from the U.S. following the arrests of its two cofounders.

Another Canadian-based processor, FirePay, announced earlier this week that they have received seizure warrants from the DOJ for about $4.2 million in gaming-related funds. FirePay stopped accepting U.S. gaming transactions following the adoption of the Unlawful Internet Gambling Enforcement Act in October.

Citadel had announced in late April that these funds had been frozen by one of its financial transaction processors.

In a separate indictment this week, three payment processors and seven individuals have been accused of miscoding gaming transactions and funneling money to online casinos and sportsbooks. BetUS has been charged with conspiring with the payment processors.

[poorolrich]

And it goes on and on and on!!!!!!!!!!!!!!!!!

[Izzy Vega]

How can US Department of Justice seize funds from a Canadian based processor?

[Roman]

this as bad as it sounds?

[Izzy Vega]

If i remember correctly Citadel stopped taking US transaction back in January. Im sure the seized funds are 'online sport book' related.

I still dont understand how the DOJ can seize funds from canadian company. Unless the canadian government assisted.

Skall maybe you can help. If a company in say Ethopia acts as a third party processor between US residents and a Poker site, the US government can then go to ethopia and seize that company's funds?

[counthomer]

From the Citadel press release:

Vancouver, BC, May 14, 2007 -- ESI Entertainment Systems Inc. (“ESI”) (TSX: ESY) and Citadel Commerce Corp, a wholly owned subsidiary of ESI, today announced that further to the press release dated April 27, 2007 concerning the US$ 9.25 million Merchant Reserve Funds frozen by its processor in the USA, these funds have now been seized by the U.S. Department of Justice (DoJ).

All of these funds are Merchants’ Reserves related to internet gaming except for approximately US$ 941,000 of Citadel’s own capital. The company is continuing to work with the DoJ through its legal counsel to resolve the situation.

[Izzy Vega]

Evermind Skall. Question anwsered. The funds were frozen by a US processor than seized by the DOJ.

[counthomer]

Izzy, the press release clearly states that the funds were seized here (in the US).

A more valid question that could be asked is that since this explains the disappearance of payment options such as eChecks, why have the gaming companies not been very forthcoming with this information?

[yahboohoo]

[ QUOTE ]
A more valid question that could be asked is...why have the gaming companies not been very forthcoming with this information?

[/ QUOTE ]
Rhetorical answer: To save their own asses.

[counthomer]

I'm amazed this hasn't received more attention, but then I guess no individual has been financially harmed.

We have several gaming companies (could be poker ones, but who knows) who have had their funds seized in the US. To my knowledge this is the first time this has happened, and a major statement of intent by the DoJ.

To my knowledge not one of these has come forward to state that they are companies involved, so basically these operators have effectively absorbed this loss quietly to avoid any panic.

At the same time we have had the loss of all Citadel related payment options, again without any official statement.

If anything shows the attitude of (some) of the operators in the current climate then this news is it.

[malo]

[ QUOTE ]
Casino City Times (http://www.casinocitytimes.com/news/article.cfm?contentID=166088) article

Citadel funds seized
By Aaron Todd
18 May 2007

Another Canadian-based processor, FirePay, announced earlier this week that they have received seizure warrants from the DOJ for about $4.2 million in gaming-related funds. FirePay stopped accepting U.S. gaming transactions following the adoption of the Unlawful Internet Gambling Enforcement Act in October.
.

[/ QUOTE ]

This is the one I really don't understand. Firepay complied with UIGEA as soon as it was signed into law. Guessing that while they stopped opening accounts for US citizens and processing gambling transactions for account holders, they still allowed people to cash any remaining funds out of Firepay? Would this have been the money seized?

This seems like the DOJ is running a high end snatch and grab---they seize the money, figuring Firepay and Citadel will tuck tail and not fight to get it back, given the current US legal climate regarding online gaming. DOJ gets more money for their slush fund to do gawd knows what with.

(Sorry...end of mindless, early AM rant......had to vent a little. Get soooo sick of this s#%t.......)

[Fonzi]

Is epassporte next?

[malo]

I am hoping not. Epassporte has been very selective about who they do business with, gaming wise. It's a short list--Stars, FullTilt, Absolute, UB, Cake and Carbon. None of them affiliated with a sportsbook or casino. Epass was started to serve the "explicit adult materials" online trade, and probably still where the bulk of their business is. Interestingly, DOJ is leaving the porn industry alone.

Having said that, I don't leave money there. It is simply a very (as in a few hours) temporary parking spot enroute to another site or an ATM cashout. Got burned by Neteller once (only for a little bit, unlike some--I was lucky), and don't want it to happen again.