Feds Continue Hunt For Evidence Of Wrongdoing By Money Transfer Firms

from the it's-bound-to-be-there,-just-keep-looking dept

Last week, money transfer firm NETeller announced that it had reached an agreement with the Feds that would allow it to give US gamblers back their money in exchange for letting its business undergo a forensic audit. It was speculated that the Feds needed to perform this audit in order to figure out what, if any, charges could be brought against the company’s founders, who were arrested in January. While NETeller’s business of transferring money to online gambling sites may currently be illegal under the law passed last October, it’s still not clear that the company was engaged in anything illegal prior to the law’s passage — that’s why the Feds have their work cut out for them. Today, the government gave off more hints that it’s on a fishing expedition just looking for something that it can call a crime. Electronic Clearing House Inc., a company that provides services to payment firms, has been told that it will not face any charges of being complicit in online gambling so long as it agrees to cooperate with the ongoing investigation into the industry. Electronic Clearing House should have a wealth of information on companies like NETeller and its smaller rivals, so it fits with the overall direction of the Feds’ activities that it would spare the company in exchange for cooperation. The best part of it is that in agreeing not to press charges, the U.S. Attorney’s Office said that charges “would not serve the public interest”, which would suggest that somehow the other cases have served the public interest.

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Comments on “Feds Continue Hunt For Evidence Of Wrongdoing By Money Transfer Firms”

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Betram Jones says:

The right to financial privacy act of 1978


“SEC. 1105. A Government authority may obtain financial records under section 1102(2) pursuant to an administrative subpena or summons otherwise authorized by law only if–
(1) there is reason to believe that the records sought are relevant to a legitimate law enforcement inquiry; “

RandomThoughts (user link) says:

According to the Patriot Act and the Bank Secrecy Act (BSA), both of which have been on the books awhile, give the government a right to look for suspicious activity in the transferring of funds.

Didn’t you know that financial institutions (anyone that transfers money or assets) monitors activity and is required (by law) to report any suspicious activity? I saw that eBay was trying to hire a anti-money laundering expert.

Gambling and casinos are key targets of the government, because that is one of the areas that criminals like to channel money to launder through them. Online? Give me a break.

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