NETeller bounces back after US gambling crackdown

The online payment processor, NETeller, has claimed it is on the road to recovery after a torrid 2007 when it was found guilty of handling billions of dollars in illegal gambling proceeds by US authorities.

Last July, the company had to pay the U.S government $136 million (£68 million) after pleading guilty to the charges.

Its co-founders, Stephen Lawrence and John David Lefebvre, were arrested in January 2007 as the U.S authorities began their clampdown on internet gambling.

That tumultuous year resulted in a pre-tax loss of $185.7 million for 2007.

The company has relocated its headquarters from Canada to the Isle of Man and cut staff from 1,100 in 2007 to 425. This has resulted in a reduction of costs between eight to ten per cent.

Chief executive Ron Martin believes the future for the company is a lot rosier.

“I am certainly comfortable with forecasts (for 2008) and would expect some upward revisions from analysts,” Martin told Reuters.

"We see margins moving significantly north over the next couple of years ... the low 60's in 2008 and the mid 60's in 09.”

In the long-term, Martin wants to reduce the company’s dependence on the online gambling market, which currently makes up 80 per cent of their business.

More: NETeller founders arrested

Editor, Jackpot.co.uk - 2008-03-12 11:33:32




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