Neteller Press Release

[Webzcas]

8 February 2007 - NETELLER Plc (LSE: NLR), the leading global independent online money transfer business, today issued the following update with regard to its US business and criminal charges against two of its founders.

On 19 January 2007, at the request of the Group, the Group’s legal advisers met with representatives of the United States Attorney’s Office for the Southern District of New York (“USAO”) to clarify the Group’s position with respect to the complaints brought on 16 January 2007 against two of the Group’s founders, Mr. Stephen Lawrence and Mr. John Lefebvre. Neither are current employees or directors of NETELLER. In that meeting, the Group pledged to cooperate with the USAO, indicated it was prepared to begin document production promptly and discussed a potential mechanism for arranging an orderly repayment of funds to US customers.

The discussions between the Group’s legal advisers and the USAO are ongoing. The Group is, under advice of its legal advisers, commencing production of documents and intends to cooperate with the USAO in its investigation.

Following upon the complaints dated 16 January 2007, banks in the US began declining to permit transactions involving the Group through accounts maintained at one or more automated clearinghouses in the United States. Additionally, the Group has been advised that the USAO has obtained court-ordered seizure warrants seizing funds pertaining to the Group’s transactions. To the best of the Group’s knowledge, it believes that the amount of funds seized by the USAO or otherwise restricted by third parties does not exceed US$ 55 million. These funds were largely in the process of being transferred from the Group to its US customers or vice versa.

As a result of the restrictions placed by third parties, court-ordered seizures, and related legal concerns, the Group is currently unable to make payments to US customers. Nevertheless, the Group is in discussions with the USAO to manage an orderly return of funds to US customers.

As part of these discussions, it is contemplated that the USAO will engage a forensic accounting firm, at the Group’s expense, to assist in this process and to examine the Group’s financial position.

“The return of funds to our US customers is a top priority for NETELLER” said Ron Martin, Group President and CEO. US customers wishing to withdraw funds from their NETELLER e-wallet accounts will experience ongoing delays while these discussions continue, and a further update will be provided by the Group once effective repayment mechanisms are determined.

To the Group’s knowledge, no criminal action or proceeding has been brought against the Group, its current officers or directors by the USAO. Nevertheless, there can be no assurance that the Group will not be charged in a criminal action at some subsequent time. The Group intends to work with the USAO to seek a negotiated resolution of any allegations relating to its US activities. Any resolution of this matter may lead to potential sanctions against the Group including material financial penalties, fines and forfeitures.

It is emphasized that in line with the Group’s standard business practices for all customers, funds held by the Group for US customers are held in segregated trust accounts. The Group’s own cash position remains strong and the Group currently has sufficient working capital to fund all its customers’ balances as well as ongoing requirements of the business.

NETELLER remains committed to developing its business in line with its stated strategic objectives including geographical and product diversification for all markets. The Group will focus on its continuing business and the opportunities available in the growing markets of Europe, Asia and the Americas outside of the United States.

Since the Group’s withdrawal from the US market on 18 January 2007, average daily new account sign-ups of new customers from non-US markets has been around 1,400. This compares to average daily sign ups of 3,303 for the year to 31 December 2006. Daily fee revenue since 18 January 2007 has averaged over US$ 200,000 per day (excluding any revenues from Netbanx, 1-Pay and interest income). These metrics demonstrate the resilience of the Group's ongoing business. NETELLER customers not resident in the US continue to be minimally affected by this withdrawal from the US market.

In view of the continuing uncertainty, the Group's shares will continue to be suspended from trading on AIM for the time being. Further announcements will be made as appropriate.

About the NETELLER Group

Trusted by millions of consumers in over 160 countries to move and manage billions of dollars each year, the NETELLER Group operates the largest independent online money transfer business in the world. The Group specializes in providing innovative and instant payment services where money transfer is difficult or risky due to identity, trust, currency exchange, or distance. Being independent has allowed the Group to support thousands of retailers and merchants in many geographies and across multiple industries.

The Group is quoted on the London Stock Exchange’s AIM market, with a ticker symbol of NLR. NETELLER (UK) Limited is authorised by the Financial Services Authority (FSA) to operate as a regulated e-money issuer. For more information about the Group visit www.netellergroup.com.

Media and Investor Contacts

Citigate Dewe Rogerson

Sarah Gestetner or George Cazenove

Tel: +44 (0) 207 638 9571

At least Neteller are trying to come to some arrangement so they can release funds owed to their US Customers.

[Amateur]

bunch of wusses!!

[vinism]

Here's the story we wrote this morning about NETeller. The intersting thing to note is the U.S. Attorney's office refuses to confirm any details.

NETeller explains U.S. withdrawal delay

February 08, 2007
by Ryan McLane NETeller is unable to pay U.S. customer withdrawals because American banks have refused to do business with one or more of the e-wallet's U.S. based automatic clearinghouses, according to a NETeller press release issued Thursday morning.


The NETeller release also states that the U.S. Attorney's Office for the Southern District of New York has seized funds of no more than $55 million that were destined for or coming from American NETeller accounts, further impeding the withdrawal process.

The NETeller group stated they are working with the U.S. Attorney's office to develop a mechanism to return money owed to U.S. customers, but that the withdrawals will continue to be on hold.

"The return of funds to our U.S. customers is a top priority for NETeller," Group President and CEO Ron Martin said.

The U.S. Attorney's office had no comment Thursday morning and would not confirm or deny details in the NETeller press release.

NETeller officials continue to state that American monies not seized by U.S. officials are held in segregated trust accounts. The release did not issue a timetable for U.S. customer withdrawals.

A group of NETeller legal advisers met with officials from the U.S. Attorney's office on January 19, three days after the FBI arrested NETeller co-founders Stephen Lawrence and John LeFebvre and charged them with money laundering.

The NETeller group pledged to cooperate with the investigation, initiate pertinent document production, and discuss a mechanism for returning money to NETeller customers located in the U.S., the release said.

"As part of these discussions, it is contemplated that the USAO will engage a forensic accounting firm, at the (NETeller) Group's expense, to assist in this process and to examine the Group's financial position."

The release stated that NETeller officials are continuing to operate under the assumption that no further charges would be filed, but added that there was "no assurances that the Group will not be charged in a criminal action at some subsequent time."

The NETeller financial position continues to be strong despite losing its massive stake in the U.S. market, according to the release.
New-account sign-ups, one measure of the e-wallets resilience, fell from a daily average of 3,303 new accounts per day in 2006, to 1,400 a day since January 18.

Still, the NETeller group claims they are fiscally sound with a daily revenue average of more than $200,000 per day from account fees produced by non-U.S. customers.

"These metrics demonstrate the resilience of the Group's ongoing business. NETELLER customers not resident in the US continue to be minimally affected by this withdrawal from the US market," the release said.
NETeller Group shares continue to be suspended from trading on the London AIM.

[Webzcas]

NETELLER customers not resident in the US continue to be minimally affected by this withdrawal from the US market," the release said.

I would say that having to wait two weeks or more for an actioned withdrawal to leave neteller and hit your bank account, is not minimal. This is not good enough IMO and is very worrying. As such I will not be using neteller until such a time this whole mess is resolved.