Neteller Arrests

[JPFisher55]

I would say that "fight's on." But this indictment does not seem to be based on the UIGEA, but on the Wire Act for assisting in funding sports betting sites. Still the WTO case will be one argument for the defense and if it wins goodbye UIGEA. I am ashamed that I was a life long Republican until this November.
I wonder if the DOJ intends to take on a poker website; probably not.

[Nate tha\\\' Great]

Reading through the indictment, it looks like they're being charged under the Wire Act and a RICO statute. It's probably not a coincidence that the informant "caught" NETELLER in the act of facilitating a sports bet, rather than a poker wager, since that's more clearly in violation of the Wire Act.

My uneducated guess is that the case itself is a stretch and is unlikely to result in a conviction.

However, the combination of the DOJ aggressively going after the payment processors at the same the UIGEA is coming on line is very bad. Very bad. I think people will be fine getting their money out and everything but it would not surprise me if this basically the beginning of the end, and the end comes faster than you'd think.

[davmcg]

[ QUOTE ]
This prosecution is part of the United States Department
of Justice’s effort to combat unlawful internet gambling through,
among other things, the implementation of the federal anti-money
laundering statutes. Other recent examples of the Justice
Department’s efforts in this regard include the indictments of two
offshore internet gambling companies – Worldwide Telesports, Inc.,
(indictment unsealed on May 17, 2006 in the United States District
Court for the District of Columbia) and BetonSports, PLC, a
publicly traded holding company that owns a number of Internet
sportsbooks and casinos, and its founder, Gary Stephen Kaplan
(indictment unsealed July 17, 2006 in the United States District
Court for the Eastern District of Missouri). Additionally, in July
2003, one of Neteller’s competitors, PayPal, and its parent eBay,
entered into a civil settlement agreement with the United States
Attorney’s Office for the Eastern District of Missouri to settle
allegations it aided in illegal offshore and on-line gambling
activities. As part of the agreement, PayPal agreed to forfeit $10
million, representing proceeds derived by PayPal from the
processing of illegal gambling transactions.

Mr. GARCIA praised the investigative efforts of the FBI
and thanked the United States Custom & Border Patrol, United States
Coast Guard, and Virgin Islands Police Department for their
assistance in the investigation. Mr. GARCIA added that the
investigation is continuing.

Mr. GARCIA stated, "Internet gambling has become a
multibillion-dollar industry that derives a major portion of its
revenues from United States citizens. STEPHEN ERIC LAWRENCE and
JOHN DAVID LEFEBVRE knew when they took their company public that
its activities, as well as those of the internet gambling companies
it assisted, were illegal in the United States. Blatant violations
of U.S. law are not a mere ‘risk’ to be disclosed to prospective
investors. Criminal prosecutions related to online gambling will
be pursued even in cases where assets and defendants are positioned
outside of the United States."

FBI Assistant Director MERSHON stated: "Internet gambling
is a multibillion-dollar industry. A significant portion of that
is the illegal handling of Americans' bets with offshore gaming
companies, which amounts to a colossal criminal enterprise
masquerading as legitimate business. There is ample indication
these defendants knew the American market for their services was
illegal. The FBI is adamant about shutting off the flow of illegal
cash."

[/ QUOTE ]

So if it was illegal to transmit funds to internet gambling companies all along - why was the UIGEA necessary?

Also why isn't the CEO of every bank in the US being simultaneously arrested?

[Wynton]

[ QUOTE ]
Reading through the indictment, it looks like they're being charged under the Wire Act and a RICO statute. It's probably not a coincidence that the informant "caught" NETELLER in the act of facilitating a sports bet, rather than a poker wager, since that's more clearly in violation of the Wire Act.

[/ QUOTE ]

Do you have a link to the actual indictment, or just a press release or news report?

[Nate tha\\\' Great]

[ QUOTE ]
I would say that "fight's on." But this indictment does not seem to be based on the UIGEA, but on the Wire Act for assisting in funding sports betting sites. Still the WTO case will be one argument for the defense and if it wins goodbye UIGEA. I am ashamed that I was a life long Republican until this November.
I wonder if the DOJ intends to take on a poker website; probably not.

[/ QUOTE ]

The WTO is not relevant. Federal law prevails in a federal court.

[Nate tha\\\' Great]

[ QUOTE ]
[ QUOTE ]
Reading through the indictment, it looks like they're being charged under the Wire Act and a RICO statute. It's probably not a coincidence that the informant "caught" NETELLER in the act of facilitating a sports bet, rather than a poker wager, since that's more clearly in violation of the Wire Act.

[/ QUOTE ]

Do you have a link to the actual indictment, or just a press release or news report?

[/ QUOTE ]

http://www.majorwager.com/forums/mes...-neteller.html

[Wynton]

Thanks, Nate. The info posted is actually the complaint, and not an indictment. But typically, the indictment mirrors the complaint anyway. A formal indictment may not have been filed yet.

[JPFisher55]

Nate, I do not agree with you. IMO, federal law, regulations or procedures cannot be enforced to the extent that they violate an international treaty like GATT or the Geneva Convention. See the recent Gitmo case ruling that President Bush's procedure to try Gitmo detainees and enabling legislation must conform to the Geneva Convention.
David Carruthers attorneys have already filed a motion to dismiss the case against him based on the WTO case. However, that case mostly involves bets taken by telephone line.
This new "Neteller" case only involves sports bets taken by Internet, which the WTO has ruled cannot be made unlawful by US law. How is the US going to claim compliance with the WTO decision? I think that the WTO case ruling that the Wire Act cannot be applied to Internet gambling will be the major issue in this new Neteller case. What other defense is available? The facts are true as stated. So the issue must be the criminality of the conduct.

[MiltonFriedman]

“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.”

Anyone know how that makes them different from VISA, MasterCard, Bank of America, Western Union ?

No details about whether this ius UIGEA or Wire Act ? Sports betting related ?

[Wynton]

MF (and anyone else with questions about the details of the charges):

Take a look at the link Nate posted. It includes an apparently verbatim transcription of the criminal complaint.