Press Releases
NETeller sees FY results in line with market expectations UPDATE
By Staff Writer - hemscott.com
Jan 11, 2008, 11:57

(Update adds details on US settlement, Calgary property sale and settlement with third party vendor)

LONDON (Thomson Financial) - NETeller PLC said it is confident the full year results for the group will meet market expectations and added its operating businesses have traded in line with the management's expectations in the fourth quarter.

In its pre-close trading update, NETeller, which processes payments for online gaming companies including PartyGaming PLC and 888 Holdings PLC said it will make the final payment of 38.25 mln usd on Jan 16 to the US authorities as part of a settlement related to Internet gambling prosecutions.

Neteller had its shares suspended from AIM in January 2007 after co-founders Steven Lawrence and John Lefebvre were arrested in the US and, subsequently, pleaded guilty to criminal conspiracy. It agreed to pay 136 mln usd to US authorities, including the 57.7 mln usd that had been seized, after officials said the company had processed more than 10 bln usd in gambling payments for US customers between 1999 and 2007.

Under an agreement reached in July 2007, Neteller and the US attorney's office in New York signed a 'deferred prosecution agreement'.

The group has to date repaid about 81 mln usd of the 94 mln usd it needs to pay to US customers under the arrangements with the USAO.

In other developments, it added the sale of its principal property in Calgary, Canada has been delayed as a result of the lenders for the intended purchaser introducing significantly less attractive terms in the wake of the recent developments in North American financial markets.

The company said constructive discussions with the intended purchaser and its lenders are continuing but there can be no certainty that a transaction will be concluded. However, the group added it is optimistic about achieving a sale in due course given the current strength of the Calgary property market.

The group added it has also recently concluded a settlement with a third party vendor who had commenced litigation against NETeller for alleged breach of contract, paying about 1.75 mln cad to settle any potential claims.

During the first half of 2008, the group will introduce significant enhancements to its consumer services, including a new suite of highly secure and convenient card products, a new rewards program, and a range of new payment options, the company said.

The group added preliminary results for the year ended Dec 31 will be released on March 11.


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