Despite a goodwill attempt by Neteller to deliver online gambling funds to the bank accounts of U.S. account holders, the United States Attorney's Office (USAO) stepped in to confiscate those funds and put a further damper on the repayment process. In response to the activities of the USAO, Neteller issued a press release advising customers of the situation, and that despite the seizure, all funds for U.S. customers are being held in segregated trust accounts. In other words, in no way will the U.S. government be able to get their hands on it.

As of now, Neteller's legal counsel is meeting with the USAO of Southern District New York to sort out the complaints that were brought against the company on January 16, 2007, as well as the criminal charges brought against Neteller's founders, Stephen Lawrence and John Lefebvre, who are both no longer with the company. Today was the day that Lawrence and Lefebvre were to learn if they would be indicted with criminal charges. That deadline has now been extended to March 16, 2007.

To aid in the USAO's investigation, Neteller is beginning to produce documents at the request of the USAO. The ongoing discussions will likely include assistance from a forensic accounting firm to determine Neteller's financial status. Ultimately, Neteller says the discussions will determine the most effective repayment mechanism of all U.S. funds, including those still held in online casino accounts, which Neteller CEO, Ron Martin, says is their top priority.

Martin urged U.S. customers to be patient during the process, and reiterated once again, that even with potential fines and forfeitures imposed on Neteller by the USAO, all funds for U.S. account holders are being protected in trust. Neteller stated that the recent seizure and blocking of funds going to U.S. accounts was no more than $55 million. Most of this money had recently transferred by players between their online casino and Neteller accounts.

Many U.S. Neteller account holders are understandably asking how the government could get away with such an act in the first place. The reason being is the USAO was successful at obtaining court-ordered seizure warrants (the UIGEA in effect), which in turn, required banks to decline and freeze financial transfers being processed through Neteller accounts maintained at U.S. automated clearinghouses. Essentially, the USAO is flexing its muscles for taking charge of the repayment process. Apparently, the USAO agrees that an orderly return of funds is a necessity and priority. In the meantime, Neteller continues doing international business elsewhere with online casinos and gaming sites, and is pleased to report their cash flow remains strong enough to fund all customer balances in addition to covering ongoing operational costs.