Canadian company Citadel fined $9.1 million in online gambling case

Canadian company Citadel fined $9.1 million in online gambling case The Canadian company ESI Entertainment Systems Inc. (ESY.T) will pay $9.1 million as part of a prosecution agreement with U.S. prosecutors in a probe of illegal online gambling. The company is part of an investigation of illegal online gambling through its subsidiary Citadel Commerce, which stands accused of processing over $2 billion in transactions with online gambling websites from the period 2003-2007. As part of the agreement with federal prosecutors, the online-payment company will avoid being prosecuted on a conspiracy charge if it avoids further wrongdoing for 18 months, as well as provide full cooperation to the authorities in the online gambling investigation. As part of a deal ESI has admitted to criminal wrongdoing, including failing to get a proper license and knowingly violating federal anti-gambling laws.

Citadel has been one of the top ACH processors for the online gambling industry, mainly for transactions with U.S. customers, but seized operations in North America, following the arrests of Neteller's co-founders John David Lefebvre and Stephen Eric Lawrence. U.S. prosecutors entered into a similar agreement with Neteller Plc., which agreed to forfeit $136 million.

Published on 06/05/2008