Neteller Might Soon Be a Payment Option
After years of avoiding the US online gambling market, Neteller has announced it plans a return. The funds processor’s return signals a major break with the recent past and acts as a sign of confidence that the American gaming industry is opening up for good.
One of the major impediments real money gamblers from the U.S. have faced over the past several years is finding a reliable money transfer option. It does a player no good to win, if they cannot withdraw their winnings. After the UIGEA law was passed, many of the best online payment companies left the US market. Neteller set the example for many others.
2007 Neteller Arrests
By 2005, Neteller handled roughly 80% of all online gambling transactions around the globe. In many ways, the company was synonymous with online casinos, poker rooms, and sports books.
In 2007, the U.S. Justice Department decided to arrest the co-founders of Neteller, Canadians Stephen Lawrence and John Lefebvre. They two men were charged them with violations of America’s 1961 Wire Act under the provisions of the Unlawful Internet Gambling Enforcement Act, which was passed in September 2006. The two men each faced up to 20 years in prison, if convincted.
In response, Neteller pulled out of the US online gambling market, which accounted for 65% of the company’s business at the time. Lawrence and Lefebvre each made plea bargains and paid $100,000,000 in fines to the U.S. government, before the case went away.
Web Wallets Leave US Gaming Market
When the Neteller case first happened, it acted as a dampener for the entire gambling industry in the USA. Many web wallets and electronic payment services decided to stop accepting US players, fearful they might be targeted for prosecution. The payment services were not the only ones.
Many of the biggest online poker sites, casinos, and sports books also stopped accepting real money gamblers from the United States. Companies like PokerStars, William Hill Online, Ladbrokes Online, and 888 Holdings had too much to lose if they faced prosecution. Online gaming software providers like Microgaming, Playtech, IGT, and Cryptologic also left the U.S. market.
While many of these companies were publicly traded on the London Stock Exchange, they wanted to provide a legal service for licensed gaming enterprises. Though the US gaming market presented the largest potential revenue stream, the US government’s hostile stance in the wake of the UIGEA made the risk too great.
2011 Justice Department Announcement
In 2011, the U.S. Justice Department announced it viewed the UIGEA law in a much more limited fashion. Instead of punishing companies which accepted US online poker players and Internet casino gamblers, they would only prosecute companies involved in sports gambling online. Several U.S. states announced they would license local gaming operators to launch gaming portals online. At present, Nevada, New Jersey, and Delaware have legal online gambling, but other states are expected to follow.
With the federal government no longer in the business of hounding gambling-related businesses, many of the big name online companies have started searching for partners in Internet website launches. Companies like 888 Holdings and Party Poker have sought partnerships with Atlantic City casinos in order to launch sites, while PokerStars awaits the end of a 2-year ban from the State of New Jersey in order to get into the American market again.
Given all that went on with Neteller’s executives in 2007, it’s a major sign of confidence that the company now feels confident to begin accepting U.S. payments and withdrawals again. This is good news for US gamblers, because finding an efficient and trustworthy payment processor is one of the traditional obstacles to good, safe online gambling.
Neteller since 2007
At the time of their legal troubles, Neteller was synonymous with online gambling. Since 2007, Neteller has diversified. The payment service is now involved in non-gambling related online money transactions, though it has remained a prime player in non-American gaming payments and withdrawals over the adjoining years. Today, Neteller is a method of payment in 180 countries worldwide.
If Neteller begins to accept American gamblers again, it will become one of the preferred methods of payment and withdrawal. Credit cards and debit cards from MasterCard and VISA are accepted for deposits at most online gambling sites, but they often are not allowed for cashouts. Because authorities are concerned that money used for online gambling could be involved in money laundering for organized crime or white collar crime, it’s the payment of casino and poker winnings which makes many cash transfer services nervous, including the big credit card companies.
