US crackdown

The ongoing crackdown in the US on online gambling following the Unlawful Internet Gaming Enforcement Act has moved on with the news that the biggest payment company, Neteller, has pulled out of the market.

As of 18 January 2007 the company, which is based in the Isle of Man, has ceased processing online payments relating to internet gambling in the US.

A statement from the company reads: “The Board confirms that the Group will cease processing online transactions related to gambling for the US market with effect from today in light of the passing of the UIGEA and the uncertainties and likely delays relating to the drafting and implementing of regulations.”

It is thought that in 2005 Neteller transferred $7 billion to gambling companies alone. To illustrate the company’s reliance on internet gambling it is also thought these transfers accounted for 95% of total revenue.

The decision by Neteller was not taken lightly. It follows in the wake of the arrests earlier this week of the two co-founders of the company, John Lefebvre and Stephen Lawrence on money laundering charges.

Lefebvre and Lawrence have made hundreds of millions of dollars by their selling shares in the company, but now face criminal charges in New York and the Virgin Islands respectively.

These charges arise from US legislation that prohibits players from using online payment, credit cards and cheques to fund wagers and poker accounts.

It is now becoming very difficult for US poker players to play shut up shop a while a go, while MyCitadel, Firepay and moneybookers among others have ceased US gambling activity.

The US government has proved it means business, and by taking away the means to fund online gambling accounts is successfully shutting down internet poker and sports betting on home soil. Not only that, it’s going after the high-flying businessmen that have cashed in on the poker boom.

It remains to be seen what happens to the operators still active in the US. PokerStars, Bodog, Full Tilt and UltimateBet are all brazenly supporting their US customers, but it remains to be seen how long they can hang on for if their players no longer have the means to make payments.