Another payment processor has (belatedly) fallen afoul of US law enforcement. Six individuals associated with Pennsylvania-based Payment Processing Centers (PPC) have been charged with illegally transferring $44m in funds to and from US citizens on behalf of international online gambling operators, including BetOnSports.com, Sportsbook.com and MySportsbook.com.
Charged with running an illegal gambling operation, conspiracy and money laundering are Donald Hellinger, Ronald Hellinger, Michael Weisberg, Randy Trost, Jami Pearlman, and Michele Quigley. If convicted, they face sentences of up to 91 years in prison and fines of $4.25m. Donald Hellinger, PPC’s former leader and past president of fashion magazine Nylon, has stated that he and his co-accused intend to fight the charges.
According to Zane D. Memeger, US Attorney for the Eastern District of Pennsylvania, the alleged gambling-related transactions occurred between Jan. 2005 and Feb. 2006. During this period, PPC allegedly moved gambling funds through DTX Solutions in the Caribbean, UK-based UC Safetx and a numbered company in Canada. The full indictment can be read here.
While the charges seem rather dated considering when the alleged offenses occurred, it appears PPC’s gambling business only came to light after four-years of grand jury proceedings involving a fraudulent telemarketing scheme in which PPC and another payment processor, Netchex, played pivotal roles. PPC was shut down in 2006 by a federal judge looking into the telemarketing fraud, which targeted mostly elderly Americans. In 2008, Wachovia Bank agreed to pay $178m to settle a class action RICO suit brought by victims of the fraud.
The fact that these charges stem primarily from online sports betting breaks the recent pattern of online poker-related fund seizures. But as noted, the company being charged ceased being a going concern five years ago, so this appears to be more a case of US law enforcement tying the ribbon on an already wrapped present.