NETELLER EXECUTES COMPLETE WITHDRAWAL FROM US MARKET
18 January 2007
Neteller has announced its complete withdrawal from the US gambling transaction market with immediate effect.
Fellow payments processor Citadel has also announced its official exit from the US.
The Neteller news came in a trading statement to the London Stock Exchange this morning.
It comes two days after founders and former directors Stephen Lawrence and John Lefebvre were detained by US authorities and charged with money laundering related to online gambling.
The statement said: “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.”
Neteller had previously signalled it would leave the US market in the wake of the passing of the UIGEA.
“Today’s withdrawal from the US market by Neteller is the culmination of months of careful planning. Along with this action, the group is actively assessing what further steps it may take in light of the two arrests made earlier this week to clarify the company’s position in this matter.”
The company added that all US customer funds were held in segregated accounts and were fully secure and are “available for withdrawal by customers on demand”.
In its statement today, Neteller said the group had experienced slowing fourth quarter growth in terms of receipts and new customer sign-ups.
It said it would continue with its focus on geographic diversification through further product launches in Europe and Asia.
The statement added that US customers made up 76% of its active customers in the fourth quarter. Of new sign-ups over the period, 74% were from North America.
Average daily receipts for the fourth quarter stood at US$5.75m. Average daily new customer sign-ups were 3,493. Revenue for the full year was expected to fall between US$255m and US$260m.
Neteller said it has already taken steps to develop country blocking software.
The Citadel news came in a statement by parent company ESI Entertainment to the Toronto Stock Exchange. It said the move came “in light of recent US Department of Justice enforcement actions against financial processor executives”.