Part 2 of the Neteller complaint
a. Records of automated clearinghouse (“ACH”) transactions obtained pursuant to subpoena from an automated clearinghouse located in the United States demonstrate that Neteller processes a significant amount of customer
transactions through the automated clearinghouse system, including transactions from customers in Manhattan. The ACH system permits Neteller to handle internet-based customer transactions. These records further demonstrate that Neteller uses a payment service company (the “Payment Company”) to conduct its customers’ ACH transactions in the name of the Payment Company. By doing so, Neteller PLC conceals the nature of these financial transactions. The Payment Company receives funds in the United States on behalf of Neteller PLC, and then transfers the funds out of the United States to accounts controlled by Neteller PLC in Canada.
b. Records of wire transfers obtained pursuant to subpoena from a bank in the
United States (the “US Bank”) demonstrate that, from in or about January 2006 up to and including in or about March 2006, a total of approximately $98 million was transferred by wire from an account in the name of the Payment Company at the US Bank in the United States to an account in the name of JSL Systems Inc. at National Bank of Canada in Calgary, Alberta, Canada. Neteller PLC’s 2004 annual report states that JSL Systems Inc. is a related company that is owned by a director of Neteller PLC that processes transactions for Neteller PLC and is paid a nominal fee for its services. In the Neteller IPO Prospectus, the Board of Directors of Neteller PLC, including STEPHEN ERIC LAWRENCE, the defendant, collectively states that LAWRENCE and CC#1 are partners in and/or directors of JSL Systems Inc.
c. Records of wire transfers obtained pursuant to subpoena from the US Bank
demonstrate that, from in or about March 2006 up to and including in or about
April 2006, a total of approximately $50 million was transferred from an account in the name of the Payment Company at the US Bank in the United States to an account in the name of Cardload Inc. at National Bank of Canada in Calgary, Alberta, Canada. Neteller PLC’s 2004 annual report states that Cardload Inc. is a wholly-owned subsidiary of Neteller PLC.
10. I have reviewed various business records of Neteller PLC that provide
information regarding the involvement of STEPHEN ERIC LAWRENCE, the defendant, in the business affairs of Neteller Inc. and Neteller PLC, including the following:
a. In the Neteller IPO Prospectus, the Board of Directors of Neteller PLC,
including LAWRENCE, collectively states the following: LAWRENCE founded the
Neteller Group in June 1999; LAWRENCE participated in developing the online
payment services of the Neteller Group and participated in raising capital for
the Neteller Group; LAWRENCE served as Chief Executive Officer of Neteller Inc. until December 2002 and drew a salary and other compensation from Neteller Inc.; LAWRENCE served as executive director of Neteller Inc. from 2001 to August 31, 2003; LAWRENCE was Chairman of the Board of Directors of Neteller PLC and would continue to serve as Chairman upon admission of Neteller PLC to AIM; LAWRENCE owned approximately 42 percent of Neteller PLC prior to the IPO, and LAWRENCE would own approximately 36 percent of Neteller PLC after the IPO; and LAWRENCE advanced to Neteller PLC approximately $3 million in an interest-free loan.
b. Neteller PLC’s 2004 annual report states that Neteller PLC is the creation of
LAWRENCE who is a major shareholder of Neteller PLC; LAWRENCE served as Chief Executive Officer of Neteller Inc. until December 2002; throughout 2004,
LAWRENCE was the Chairman of the Board of Directors of Neteller PLC; on or about December 31, 2004, LAWRENCE was the largest shareholder of Neteller PLC, owning 21.94% percent of the outstanding shares of Neteller PLC; and during 2004, the Board of Directors of Neteller PLC granted LAWRENCE options to purchase additional shares of Neteller PLC.
c. Neteller PLC’s 2005 annual report states that LAWRENCE served as Chairman of the Board of Directors of Neteller PLC during 2005, but that LAWRENCE would step down from his position as Chairman at Neteller PLC’s annual general meeting in 2006; during 2005, the Board of Directors of Neteller PLC granted LAWRENCE options to purchase additional shares of Neteller PLC; and during 2005, Neteller PLC paid LAWRENCE compensation for serving as a director.
11. I have reviewed various business records of Neteller PLC that demonstrate
that STEPHEN ERIC LAWRENCE, the defendant, had knowledge that he was
participating in criminal activity in the United States. For example, in the
Neteller IPO Prospectus, the Board of Directors of Neteller PLC, including
LAWRENCE, collectively states that criminal laws exist in the United States that prohibit persons from promoting certain forms of gambling; criminal laws exist in the United States that prohibit the transmission of funds that are known to have been derived from criminal activity or are intended to promote criminal activity; that to date most of the criminal prosecutions related to online gambling in the United States have been limited to cases where assets or relevant individuals are located in the United States; that the Neteller Group does not maintain offices or assets in the United States; and that there can be no assurance that the government of the United States will not try to prosecute the Neteller Group under existing or future federal laws. WHEREFORE, deponent prays that a warrant be issued for the arrest of the above-named individual and that he be arrested and imprisoned or bailed as the case may be.
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MARYANN GOLDMAN
SPECIAL AGENT
FEDERAL BUREAU OF INVESTIGATION
Sworn to before me this day of January 16, 2007
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UNITED STATES MAGISTRATE JUDGE
SOUTHERN DISTRICT OF NEW YORK