Gambling News by Gambling Headquarters

Two founders of a company that processes Internet gambling transactions were arrested and charged with funneling billions of dollars in gambling proceeds to overseas betting operations, federal prosecutors announced Tuesday. The charges mark the latest in a series of crackdowns by the federal government against the online gambling industry. The charges against the former Neteller PLC directors, John David Lefebvre, 55, and Stephen Eric Lawrence, 46, both Canadian citizens, were contained in two criminal complaints unsealed in U.S. District Court in Manhattan on Monday, U.S. Atty. Michael Garcia said. The prosecutor said the men knew when they took their company public that its activities were illegal. FBI Assistant Director Mark Mershon said the multibillion-dollar online gambling industry is "a colossal criminal enterprise masquerading as legitimate business." Neteller is an Internet payment services company that has grown in popularity as more credit card companies have begun refusing to accept payments to online gambling sites. Neteller acts as a middleman between gamblers and offshore betting operations. A gambler who wants to place bets at offshore sports books can fund an account with Neteller, which transfers the money to the sites. Lefebvre was arrested Monday in Malibu, Calif., and was scheduled to appear in U.S. District Court in Los Angeles on Tuesday. Lawrence was arrested Monday in the U.S. Virgin Islands and will appear in federal court on Wednesday. Peter Neiman, a lawyer for Lawrence, said he had no comment. A lawyer for Lefebvre did not immediately return a phone message seeking comment. Lawrence and Lefebvre were charged with conspiring to transfer funds with the intent to promote illegal gambling, and could face up to 20 years in prison if convicted.