Two founders and former directors of NETeller were detained Monday in the United States while traveling separately. Stephen Lawrence and John Lefebvre, who both have not had active roles in the company for several months, were arrested and charged with conspiring to transfer funds with the intent to promote illegal gambling.
Lawrence was arrested Monday in the U.S. Virgin Islands and will make his first court appearance in St. Thomas on Wednesday. Lefebvre, who was arrested in Malibu, Calif., will be presented in a Los Angeles court today.
The charges were announced during a press conference today by U.S. Attorney Michael Garcia after having been unsealed in U.S. District Court Monday in two criminal complaints.
Garcia said that the two men were arrested in connection with the creation and operation of an Internet payment services company that helped move billions of dollars of illegal gambling money from U.S. citizens to overseas Internet gambling companies.
According to NETeller, Lawrence and Lefebvre no longer hold any position at the company or have any other connection aside from being shareholders. Lefebvre stepped down from the company in 2005, and Lawrence left in October 2006.
The company asked that trading of its shares be suspended immediately until the situation has been clarified. In a press release, the company also said it hadn't received any communication from U.S. authorities regarding the matter.
Shares in the company have already fallen 60% since the Unlawful Internet Gambling Enforcement Act (UIGEA) was passed in an effort to ban Internet gambling in the United States.
NETeller is best known as an online money transfer firm. After the United States passed the UIGEA, industry experts noted that customers would still be able to use companies such as NETeller to pay for their online gambling.
NETeller operates the largest independent online money transfer business in the world and is one of the most popular payment options used by Internet gamblers and poker players.