Internet Gambling Payment Company Caught Red Handed by US Government

A Canadian online payment company called Entertainment Systems, Inc (ESI) has confessed to a conspiracy to operating illegally with internet gambling businesses, for which it will pay the US Attorney’s Office criminal proceeds of more than $1.9 million, as part of a delayed prosecution agreement.

According to prosecutors, ESI’s wholly owned subsidiary, Citadel Commerce Corporation, illegally conducted financial transactions to internet gambling websites for US customers from 2002 to January 2007. Citadel’s operations included many forms of internet gambling transactions, such as casino gambling, sports betting and poker, yet the main goal of the company was to serve customers within the US, who had been cut out from the internet gambling world due to the UIGEA.

Approximately 80% of ESI’s profits were derived from Citadel’s operations in 2006, of which 90-95% were derived from payment processing services provided to customers living in the United States. It is believed that Citadel profited over $2 billion in payments made at internet gambling websites by US customers, which generated tens of million for Citadel in revenues. In the Statement of Admitted Facts, ESI confessed that Citadel’s operations with US customers violated the country’s law on internet gambling.

As part of the agreement made, ESI will pay $9.114 million to the US and cooperate entirely with the Government prosecution made against them. The prosecution has been delayed by 18 months, whereby if by December 2009 ESI has complied fully with the agreement’s terms, the information will be dismissed by the Government.

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Internet Gambling Payment Company Caught Red Handed by US Government

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