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Yes, I was just reading this when you posted it Peter.
Press Release
NETELLER Announces Settlement of US Situation
Wednesday, 18 July 2007 - NETELLER Plc (LSE: NLR), the independent global online payments business, today announces that the Company has entered into a Deferred Prosecution Agreement (“DPA”) with the United States Attorney's Office for the Southern District of New York (“USAO”). The DPA represents the resolution of the USAO’s investigation into the Company.
Pursuant to the DPA, the Company has consented to the filing of a criminal information relating to transactions between Internet gambling merchants and persons located in the United States. The USAO has agreed to defer the prosecution of any federal charges and, as a consequence, the Company will not be convicted of any federal crime, as long the Company fulfils the set conditions of the DPA during the two year term of the agreement. At the conclusion of the two year term, the criminal information will be dismissed. The key terms of the DPA are set out in more detail later in this announcement. The United States District Court for the Southern District of New York has approved the deferral of the prosecution. As part of the DPA, the Company has also agreed to forfeit US$ 136 million to the United States. This amount includes the approximately US$ 60 million that the USAO has previously seized.
Additionally the Company announces:
* Following this resolution, the Company will seek to publish its audited annual accounts for 2006 and have its shares restored to trading on AIM as soon as practicable thereafter.
* The Company is using its best efforts to allow withdrawal requests as soon as possible and US customers will be able to sign in to their NETELLER account to request the withdrawal of their funds by no later than 30 July 2007. The exact date upon which US customers will be able to make requests will be communicated to US customers via email and through our website.
Ron Martin, President & CEO, said “This agreement resolves the USAO’s investigation relating to the Company’s former US business activities. We believe that this settlement is in the best interests of NETELLER and its shareholders."
“Our customers, employees and shareholders have all patiently waited for this resolution. We anticipate within the next few weeks that we will have fully implemented the plan for the return of funds to our US customers and are hopeful that, by that time, we will have restored the Company’s shares to trading on AIM. We can now begin to refocus our efforts on building and strengthening the NETELLER business in the growing markets of the European and Asia Pacific regions. I look forward to sharing further information about the Company’s progress over the coming months.”
Key terms of the Deferred Prosecution Agreement
The settlement takes the form of a two year DPA with the USAO. In the DPA, NETELLER has consented to the filing with the United States District Court for the Southern District of New York of a criminal information charging NETELLER with participating in a conspiracy in violation of certain US laws. If NETELLER fulfils its obligations under the DPA, the criminal information will be dismissed, following the two year term.
Specifically, the DPA contains the following main points:
* NETELLER, as detailed in the “Statement of Admitted Facts” attached to the DPA, admits that it had operated in the US an unlicensed money transmitting business and had participated in the performance of financial transactions for the purpose of promoting unlawful transactions between internet gambling merchants and persons located in the US.
* NETELLER agrees that it will pay an amount to the United States totalling US$ 136 million which is disgorgement of certain profits received by NETELLER from the activities described in the Statement of Admitted Facts. This amount includes the approximately US$ 60 million that the USAO has previously seized. NETELLER agrees that it will satisfy the remaining portion of its forfeiture obligation with a payment of US$ 40 million to be paid on or before 15 October 2007, and the remaining balance (approximately US$ 36 million) to be paid on or before 17 January 2008.
* NETELLER agrees to cooperate fully with US authorities in all matters relating to the ongoing investigations by the USAO.
* NETELLER agrees to fully implement procedures and controls to prevent illegal transactions between internet gambling merchants and persons located in the US and to continue to retain Navigant Consulting Inc., a forensic accounting firm, to monitor NETELLER’s compliance with these procedures and controls.
Distribution Plan to be implemented
As announced on 4 June, the Company has agreed to a plan for the distribution of funds to its US customers. The agreed plan details the process and mechanisms by which US customers will be able to initiate the return of their funds after the plan is implemented. NETELLER is using its best efforts to start implementing the plan as soon as possible and, in any event, by no later than 30 July 2007. The Company will communicate to US customers via email and through its website the exact date upon which such customers will be able to make requests.
Restoration of trading to AIM
As stated in the Company’s announcement of 13 July, the Company continues to make progress regarding the ongoing suspension of the Company's shares from trading on AIM. The Company is in discussions with its advisers and AIM and understands that the admission of the Company’s ordinary shares to trading on AIM has not to date been cancelled.
With today’s announcement of a resolution of the USAO investigation, the Company is now focused on finalising and publishing its audited annual accounts for 2006. The Company will endeavour to post the 2006 accounts to its shareholders as soon as practicable following which the Company anticipates that trading in the Company’s ordinary shares on AIM will be restored.
Further details will be announced as and when they become available.
About the NETELLER Group
Trusted by millions of consumers in over 160 countries to move and manage billions of dollars each year, the NETELLER Group operates the world's leading independent online payment business. The Group specializes in providing innovative and instant payment services where money transfer is difficult or risky due to identity, trust, currency exchange, or distance. Being independent has allowed the Group to support thousands of retailers and merchants in many geographies and across multiple industries.
The Group is quoted on the London Stock Exchange’s AIM market, with a ticker symbol of NLR. NETELLER (UK) Limited is authorised by the Financial Services Authority (FSA) to operate as a regulated e-money issuer. For more information about the Group visit www.netellergroup.com.
Media and Investor Contacts
NETELLER Group media and investor relations are managed by Citigate Dewe Rogerson. Contact them through the Media Relations Contact page.Comment -
Any thoughts? Maybe I'm just splitting hairs but what has me a little worried is some of the language they use when talking about the money they're paying to the U.S. gov. Why are they specifically mentioning the $60M that was seized as being part of the $136M total payout? Are U.S. customers not going to see that $60M? If it's all "company money" then what's the difference?
They say U.S. customers will be able to make withdraw requests but where does it say that all customers will be paid in full?Comment -
I don't think that's correct. It's pertinent to shareholders that they're not paying an additional 136, but only an additional 76, has a direct effect on the value of the company. That's why it was mentioned.Comment -
At this point, I would say this is a fair price:
Will Neteller pay any US holder who makes a request before 10-1-07?
Yes -400
No +400Comment -
That makes sense Santo, hope you're right. It would still ease my mind if they said "All U.S. customers will be paid in full".Comment -
NETELLER Announces Settlement of US Situation
Press Release
NETELLER Announces Settlement of US Situation
Wednesday, 18 July 2007 - NETELLER Plc (LSE: NLR), the independent global online payments business, today announces that the Company has entered into a Deferred Prosecution Agreement (“DPA”) with the United States Attorney's Office for the Southern District of New York (“USAO”). The DPA represents the resolution of the USAO’s investigation into the Company.
Pursuant to the DPA, the Company has consented to the filing of a criminal information relating to transactions between Internet gambling merchants and persons located in the United States. The USAO has agreed to defer the prosecution of any federal charges and, as a consequence, the Company will not be convicted of any federal crime, as long the Company fulfils the set conditions of the DPA during the two year term of the agreement. At the conclusion of the two year term, the criminal information will be dismissed. The key terms of the DPA are set out in more detail later in this announcement. The United States District Court for the Southern District of New York has approved the deferral of the prosecution. As part of the DPA, the Company has also agreed to forfeit US$ 136 million to the United States. This amount includes the approximately US$ 60 million that the USAO has previously seized.
Additionally the Company announces:
Following this resolution, the Company will seek to publish its audited annual accounts for 2006 and have its shares restored to trading on AIM as soon as practicable thereafter.
The Company is using its best efforts to allow withdrawal requests as soon as possible and US customers will be able to sign in to their NETELLER account to request the withdrawal of their funds by no later than 30 July 2007. The exact date upon which US customers will be able to make requests will be communicated to US customers via email and through our website.
Ron Martin, President & CEO, said “This agreement resolves the USAO’s investigation relating to the Company’s former US business activities. We believe that this settlement is in the best interests of NETELLER and its shareholders."
“Our customers, employees and shareholders have all patiently waited for this resolution. We anticipate within the next few weeks that we will have fully implemented the plan for the return of funds to our US customers and are hopeful that, by that time, we will have restored the Company’s shares to trading on AIM. We can now begin to refocus our efforts on building and strengthening the NETELLER business in the growing markets of the European and Asia Pacific regions. I look forward to sharing further information about the Company’s progress over the coming months.”
Key terms of the Deferred Prosecution Agreement
The settlement takes the form of a two year DPA with the USAO. In the DPA, NETELLER has consented to the filing with the United States District Court for the Southern District of New York of a criminal information charging NETELLER with participating in a conspiracy in violation of certain US laws. If NETELLER fulfils its obligations under the DPA, the criminal information will be dismissed, following the two year term.
Specifically, the DPA contains the following main points:
NETELLER, as detailed in the “Statement of Admitted Facts” attached to the DPA, admits that it had operated in the US an unlicensed money transmitting business and had participated in the performance of financial transactions for the purpose of promoting unlawful transactions between internet gambling merchants and persons located in the US.
NETELLER agrees that it will pay an amount to the United States totalling US$ 136 million which is disgorgement of certain profits received by NETELLER from the activities described in the Statement of Admitted Facts. This amount includes the approximately US$ 60 million that the USAO has previously seized. NETELLER agrees that it will satisfy the remaining portion of its forfeiture obligation with a payment of US$ 40 million to be paid on or before 15 October 2007, and the remaining balance (approximately US$ 36 million) to be paid on or before 17 January 2008.
NETELLER agrees to cooperate fully with US authorities in all matters relating to the ongoing investigations by the USAO.
NETELLER agrees to fully implement procedures and controls to prevent illegal transactions between internet gambling merchants and persons located in the US and to continue to retain Navigant Consulting Inc., a forensic accounting firm, to monitor NETELLER’s compliance with these procedures and controls.
Distribution Plan to be implemented
As announced on 4 June, the Company has agreed to a plan for the distribution of funds to its US customers. The agreed plan details the process and mechanisms by which US customers will be able to initiate the return of their funds after the plan is implemented. NETELLER is using its best efforts to start implementing the plan as soon as possible and, in any event, by no later than 30 July 2007. The Company will communicate to US customers via email and through its website the exact date upon which such customers will be able to make requests.
Restoration of trading to AIM
As stated in the Company’s announcement of 13 July, the Company continues to make progress regarding the ongoing suspension of the Company's shares from trading on AIM. The Company is in discussions with its advisers and AIM and understands that the admission of the Company’s ordinary shares to trading on AIM has not to date been cancelled.
With today’s announcement of a resolution of the USAO investigation, the Company is now focused on finalising and publishing its audited annual accounts for 2006. The Company will endeavour to post the 2006 accounts to its shareholders as soon as practicable following which the Company anticipates that trading in the Company’s ordinary shares on AIM will be restored.
Further details will be announced as and when they become available.Comment -
Neteller to Forfeit $136 Million
In Deal With U.S. Prosecutors
By CHAD BRAY
July 18, 2007 12:31 p.m.
NEW YORK -- Online payment services company Neteller Inc. agreed to forfeit $136 million as part of a deferred prosecution agreement with prosecutors in their probe of illegal online gambling.
At a hearing in federal court in Manhattan, John Carroll, a lawyer for the Isle of Man company, said Neteller had agreed to enter the agreement, in which the firm will avoid being prosecuted on a conspiracy charge if it avoids further wrongdoing for two years.
As part of the pact, Neteller will return an additional $94 million it had been holding for U.S. customers and will be under a monitoring program for an 18-month period that began last month.
"The company's happy to put this behind us," Mr. Carroll said afterwards. "We look forward to getting money back to our customers and growing the business."
At the hearing before U.S. District Judge P. Kevin Castel, Mr. Carroll said the company agreed, as part of a statement of facts under the deferred prosecution agreement, that it had violated U.S. law.
Neteller co-founders John David Lefebvre and Stephen Eric Lawrence each recently pleaded guilty to a conspiracy charge in connection with the alleged transfer of Internet gambling proceeds. They each face up to five years in prison on the charge.
Mr. Lawrence, Neteller's former chairman, is scheduled to be sentenced Oct. 29, while Mr. Lefebvre, its one-time president, is scheduled to be sentenced Nov. 1.
Both men also agreed to a forfeiture allegation of $100 million in the matter and are cooperating with the government's probe. Neteller, which is publicly traded in London, has said Messrs. Lawrence and Lefebvre are no longer affiliated with the company. Neteller has stopped handling transactions involving online gambling from U.S. customers.
Electronic Clearing House Inc., another online payment processing company, entered a non-prosecution agreement with the government in March and agreed to disgorge $2.3 million. Neteller was one of its customers.
U.S. authorities have cracked down on online gambling in recent months, arresting executives of some overseas online gambling firms when they travel to the U.S. President Bush signed into law legislation in October that makes it illegal for banks and credit-card companies to process payments from U.S. customers to online gambling sites.
U.K. online gambling firm BetOnSports PLC pleaded guilty to a racketeering conspiracy charge in May in federal court in St. Louis. The company's founder, Stephen Kaplan, and Chief Executive David Carruthers are still facing criminal charges in the matter.
Write to Chad Bray at chad.bray@dowjones.comComment -
at least things are finally moving along, albeit very slowlyComment -
Great. another annoucement that they will make an announce as to when we will get paid. No doubt they will wait uintil July 30th to make the next announcement.
The only good news is that unlike BOS, they make no mention of simply declaring bankruptcy and stealing everyones money.Comment -
Based on the fact that the US Government is intimately involved with the way Neteller is operating at the moment, and the fact that Neteller desperately wants this situation behind them so they can start trading their shares again; I would say that only an Act of God would prevent all US accounts from being paid in full.Comment -
It says no later than July 30, US customers can sign in and request transfer. Hope so...Comment -
$136 million is slightly less than 18 months of their gross profits (they made $97.8 M in 2005 and $58 M in the first half of 2006) so they are still well ahead overall for the period they were able to operate with U.S. clients.Comment -
So it looks like they made at least $200 million in 2005-2006. That should be enough to cover the fine and continue to run business. Will the two owners also have to pay $100 million fine? What a deal for the government!Comment -
Nice extortion - although it looks like it was about the 40% corporate tax they would have paid on US profits to the US if based here (and they sort of were since they had shell operations here)
And why two years??? Because its two more years before Neteller can go back into Canada, but the US DOJ can't say that...
Go get yourself a nice neteller account in Panama or the UK or wherever and it will be biz as usual soon.
SeanComment -
NETELLER Resolves Investigation With U.S. Government
I'm so happy.Comment -
As a Canadian i've always believed that Neteller left the Canadian market as part of the inevitable deal that would be worked out with the DOJ. And i've always believed that Neteller would return at some point to the canadian market when the whole U.S mess was finally put to bed. Canadian neteller accounts were never disabled, we were given ample warning as to when neteller would cease gambling transactions in canada, and our money that was in neteller was transferred to us in a timely manner. With that said, i never had any idea as to when this return might be, but with this ruling, the 2 year mark seems to be where it's headed.Comment -
And in 2 years, the US will have legal taxing gaming and NT in Canada won't matter.
The DOJ is a bunch of asses, but the government is very smart at what they do.
Now I do and always will wonder what would have happened if neteller told the feds to F off.... We're in the UK get lost...
SeanComment -
All of these events show the USA Governments true intentions and M.O.
Interesting considering EXTORTION/BLACKMAIL is illegal in most of the free world ( USA Excluded )Comment
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