Digital Currency Business E-gold Indicted

Digital Currency Business E-Gold Indicted for Money Laundering and Illegal Money Transmitting
2007-04-27 21:39:19

WASHINGTON, April 27 /PRNewswire-USNewswire/ -- A federal grand jury in Washington, D.C. has indicted two companies operating a digital currency business and their owners on charges of money laundering, conspiracy, and operating an unlicensed money transmitting business, Assistant Attorney General Alice S. Fisher of the Criminal Division and U.S. Attorney for the District of Columbia Jeffrey A. Taylor announced today.

The four-count indictment, handed down on April 24, 2007, and unsealed today, charges E-Gold Ltd; Gold & Silver Reserve, Inc.; and their owners Dr. Douglas L. Jackson, of Satellite Beach,
Fla.; Reid A. Jackson, of Melbourne, Fla.; and Barry K. Downey, of Woodbine, Md., each with one count of conspiracy to launder monetary instruments, one count of conspiracy to operate an unlicensed money transmitting business, one count of operating an unlicensed money transmitting business under federal law and one count of money transmission without a license under D.C. law.

Subsequent to the indictment, the Department of Justice also obtained a restraining order on the defendants to prevent the dissipation of assets by the defendants, and 24 seizure warrants on over 58 accounts believed to be property involved in money laundering and operation of an unlicensed money transmitting business. The restraining order does not limit the E-Gold operation's ability to use its existing funds to satisfy requests to exchange E-Gold into national currency for customers of non-seized accounts, or its ability to sell precious metals to accomplish the same, once approval has been received.

According to the indictment, E-Gold's digital currency, "E-Gold," functioned as an alternative payment system and was purportedly backed by stored physical gold. Persons seeking to use the E-Gold payment system were only required to provide a valid email address to open an E-Gold account - no other contact information was verified. Once an individual opened an E-Gold account, he/she could fund the account using any number of exchangers, which converted national currency into E-Gold. Once open and funded, account holders could access their accounts through the Internet and conduct anonymous transactions with other parties anywhere in the world.

The indictment alleges that E-Gold has been a highly favored method of payment by operators of investment scams, credit card and identity fraud, and sellers of online child pornography. The indictment alleges that the defendants conducted funds transfers on behalf of their customers, knowing that the funds involved were the proceeds of unlawful activity; namely child exploitation, credit card fraud, and wire (investment) fraud; and thereby violated federal money laundering statutes. The indictment further alleges that the defendants operated the E-Gold operation without a license in the District of Columbia or any other state, or registering with the federal government, and thereby violated federal and state money transmitting laws. The indictment alleges that this conduct occurred at various times from 1999 through December 2005.

"As alleged in the indictment, the E-Gold payment system has been a preferred means of payment for child pornography distributors, identity thieves, online scammers, and other criminals around the world to launder their illegal income anonymously," said Assistant Attorney General Alice S. Fisher of the Criminal Division. "This indictment demonstrates that the Department of Justice, in cooperation with its law enforcement partners, will aggressively identify and prosecute those who knowingly enable and profit from transmitting the proceeds of criminal activity, online or offline."

"Douglas Jackson and his associates operated a sophisticated and widespread international money remitting business, unsupervised and unregulated by any entity in the world, which allowed for anonymous transfers of value at a click of a mouse," said U.S. Attorney Jeffrey A. Taylor for the District of Columbia. "Not surprisingly, criminals of every stripe gravitated to E-Gold as a place to move their money with impunity. As alleged in the indictment, the defendants in this case knowingly allowed them to do so and profited from their crimes."

"Today's indictment is the result of a two and a half year investigation by the U.S. Secret Service Orlando Field Office into an alternative payment system which has largely operated outside of normal banking industry regulations," said Secret Service Assistant Director for Investigations Michael Stenger. "This system has been exploited for more than 10 years by criminals who operate primarily via the Internet. Cooperation among investigators, including the IRS, the FBI and other state and local law enforcement, has enabled us to more effectively address emerging threats and evolving criminal methods, such as the use of electronic or digital currency to facilitate trafficking in illicit goods and services."

"The advent of new electronic currency systems increases the risk that criminals, and possibly terrorists, will exploit these systems to launder money and transfer funds globally to avoid law enforcement scrutiny and circumvent banking regulations and reporting," said Assistant Director James E. Finch, of the FBI's Cyber Division. "The FBI will continue to work closely with the Department of Justice and our federal and international law enforcement partners to aggressively investigate and prosecute any, and all, persons or organizations that use these systems to facilitate child pornography distribution, to support organized crime, and to perpetrate financial crimes."

"This is a new twist on laundering money through unlicensed money transmitters but it is nothing new for financial investigators," said Eileen Mayer, Chief of IRS Criminal Investigation. "The combined investigative skills of the law enforcement partners under the St. Cloud IRS Criminal Investigation and Secret Service Task Force proved to be a brick wall for E- Gold. We are proud to bring our financial expertise to this type of investigation that ultimately unravels fraud."

The conspiracy charge in the case relating to money transmitting carries a maximum sentence of five years in prison. The federal law violation of operating an unlicensed money transmitting business carries a maximum sentence of five years in prison. The D.C. Code violation for money transmission without a license carries a maximum sentence of five years. The conspiracy charge relating to money laundering carries a maximum sentence of 20 years in prison.

The case is being investigated by the U.S. Secret Service with the assistance of the IRS and the FBI. The case is being prosecuted by the U.S. Attorney's Office for the District of Columbia and the Computer Crime and Intellectual Property Section of the Criminal Division. Assistance is also being provided by the Child Exploitation and Obscenity Section and the Asset Forfeiture and Money Laundering Section of the Criminal Division.

An indictment is merely an accusation and the defendants are presumed innocent unless and until proven guilty.

Source: U.S. Department of Justice


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E-gold Major Agents’ Accounts Seized By US Government and 1MDC Is No Longer Operational.


It now appears this morning that all large e-gold exchange agents doing business with US clients have had their e-gold accounts seized by US court order.

Here is what we know as of this morning.

Icegold, AnyGoldNow, 1mdc, Omnipay and other large exchange agents have all had their accounts blocked by a US government agency court order.
When attempting to log in on these accounts, the e-gold server responds that the account does not exist. It appears the accounts have been seized by the US authorities.
It is now not possible to unbail (withdraw) bars from e-gold Ltd.

From the 1mdc web site. http://www.1mdc.com/

ATTENTION
Friday Apr 27 2007 - 4AM UTC

It appears that a U.S. Government court order has forced e-gold® to close down or confiscate all of 1mdc’s accounts. All 1mdc account’s have been closed at e-gold by order of the US Government.

Please note that it appears the accounts of many of the largest exchangers and largest users of e-gold have also been closed or confiscated overnight: millions of Euros of gold have been lost or confiscated in this event. Many of the largest exchangers are shutdown.

Realistically, it is extremely unlikely that this action will ever be reversed.

If the action is reversed, your e-gold grams remaining in 1mdc will “unbail” normally to your e-gold account.

You CAN spend your 1mdc back and fore to other 1mdc accounts. However you must be aware that it is likely your e-gold will never be released from e-gold.

Ultimately e-gold® is an entirely USA-based company, owned and operated by US citizens, so, as e-gold users we must respect the decisions of US courts and the US authorities regarding the disposition of e-gold and the safety and security of US citizens.

Even though 1mdc has no connection whatsoever to the USA, and most 1mdc users are non-USA, ultimately e-gold is USA based.

1mdc thanks it’s users and technical staff and support staff. From 1mdc’s point of view, 1mdc had only just started to generate income from spend fees so five years expense and experimentation was wasted.

It is the opinion of your 1mdc team that:

The early era of DGC privacy is over.

USA citizens will simply never be able to use DGCs.

The only DGCs that operate from now on will:

(a) Have no connection to the US

( Have no USA users (exactly as Swiss banks have no USA users)

© Will have higher ID requirements than e-gold currently does.

You are welcome to email “team@1mdc.com” but, again, the realistic view is that the e-gold® will never be released. Note that of all e-gold confiscated by US court order, none has ever been released.

http://digitalmoneyworld.com/

http://hyipblog.nobshyip.net/2007/04/27/e-...80%99-accounts/ - discussion

http://digitalmoneyworld.com/

http://www.pr-inside.com/digital-currency-...ted-r107629.htm or http://www.usdoj.gov/opa/pr/2007/April/07_crm_301.html

Ladies Beware Especially In Orchard Road

LADIES BEWARE ESPECIALLY IN ORCHARD ROAD
extract from other source...

"For those who have not read this yet.... good advice and take care"

Dear Friends,

PLEASE DO NOT DISCARD THIS MESSAGE ---- VERY IMPORTANT MUST READ...
Especially those who love to go Orchard Road !!!!

Beware, don't talk to strangers specially China men. Beware and alert
your friends, wife and family members.Be Alert At All Times ! This is
scary.....

My female friend encountered this incident in Orchard.
That time she was waiting for me at Orchard Tower.
She was approached by an Chinese 30 to 40yrs old man.
I saw the man talking to her while I am walking toward her. I was puzzled
when she suddenly walked off with the man .......and even stunned when
she walked pass me without looking at me...but I am standing in front of
her!!

Thinking something amiss, I called her handphone instead. She answered the phone and was shocked to realise she is no longer outside Orchard Tower. The man must have saw his charm being broken, immediately talked to her again..... This time I told my friend don't listen to what he said and not to look at his eyes.....juz RUN! She quickly ran off ......She called me again after 15mins..... and meet me at Takashimaya. She was shivering all over when I met her. She told me she really don't know what was going on..... I told her I heard of this kind of things before, ...... but nvr expected to see it myself too...... Well....... that day, she took almost half a day to calm herself down.

My friend sent me the following email yesterday, am forwarding to all of u
for info so that u would not be caught in that situation. Take care!

"While waiting for my husband at Tangs side entrance facing Lucky Plaza, a Chinese man suddenly approached me, disregarding my personal space, stood so close to me that I need to back off. Then he asked me where was a place, which I didn't comprehend. After repeating 2 times or so, he said the place was where they sell chicken rice, duck rice, making some innocent hand gestures like counting, so I thought he meant foodcourt, told him that he could go down the flight of stairs next to Mac to basement He appeared lost and asked me again if it was on left hand side or right handside. I was little irritated as we were facing the stairs,such a big stairway and u are asking me right or left!
Luckily my husband arrived at that time. The taxi behind him sounded the
horn, so I hurriedly pointed again to the stairway and asked him to go
down.

Later I was suddenly awaken with an uneasy feeling. Realized that he might be a hypnotiser. As I remembered that he was loitering near me for some time, but I just took it that he was another passerby at that moment. He spoke in a deliberate and slower manner, his hand gestures when mentioning chicken rice; duck rice, etc and his deliberate attempt in asking me if left or right. These people try to get us to conjure up images in our mind, that's how they hypnotise us.
The reason why I thought of a hypnotiser was because my KL friend shared with me 3 mths back that her friend had fallen victim when she woke up naked, not remembering what happened.

This also happened to an ex-colleague of mine. Her story was that she was at busy shopping center exit, saw flustered Chinese man speaking very loudly on HP, then the man approached her for help, told her that his
girlfriend from overseas came to look for him but was lost,so wanted to
borrow money from my friend, amount was quite a lot which my friend didn't have. After talking for a while, he even managed to ask her to follow him.


Fortunately her HP rang, she said she suddenly became more aware of what was happening, before that, she just wanted to follow him to help him. Immediately she told the man she didn't have money and left.

So beware of all foreign Chinese man! I can't descripe his accent but he
is definitely not S'porean. He is very decently dressed, normal guy on the
street, maybe late 30s, carrying a rather big shoulder sling bag.

Please alert your galfriends, sisters, mothers etc.

China And Gold

Below is an extract from a commentary originally posted at www.speculative-investor.com on 17th January 2006.

China's State Administration of Foreign Exchange recently said that one of its targets for 2006 was to "improve the operation and management of foreign exchange reserves and to actively explore more effective ways to utilise reserve assets". This statement generated a great deal of discussion about the possibility of China selling some of its US$-denominated reserves and increasing its gold reserves, actions that would potentially have huge impacts on the currency, bond and gold markets given the enormity of China's US$ reserves.

China presently holds about US$800B of foreign currency reserves -- most of it US$-denominated -- and is likely to have at least one trillion dollars of reserves by this time next year. In comparison, the combined total of gold reserves reported by the world's central banks is around 30,000 tonnes, or US$530B of gold at the current gold price. Note, though, that about half of this gold has probably been loaned or swapped in order to generate income and/or keep a lid on the gold price, so the actual amount of physical gold in the vaults of the world's central banks might only be in the vicinity of 15,000 tonnes (US$265B worth of gold at the current gold price). In other words, if China's Government decided to make a shift in the way its reserves were allocated such that in 12 months time 25% of its reserves were gold, the amount of gold it would need to purchase would be equivalent to the sum total of all the gold currently held in the vaults of the world's central banks. Furthermore, even if China decided to convert only 5% of its dollar-denominated reserves into gold it would need to purchase the equivalent of one year of the world's total mine supply.

Obviously, if China attempted to shift only a small portion of its reserves from dollars to gold the effect on the gold price would be substantial to say the least. In fact, if China were to go into the market and convert 5% of its current foreign exchange reserves into gold it would probably have the effect of doubling or tripling the gold price. This, quite naturally, is a possibility that excites many gold bulls.

However, the dramatic effect on the gold price that would be caused by China making even a small shift out of dollars and into gold all but eliminates the possibility of such a shift taking place. If China held a lot less dollars and there was a lot more gold in the world then shifting reserves from dollars to gold might be feasible, but as things currently stand it's really not an option.

At this stage inflation fears remain surprisingly low, thus supporting a high average price/earnings ratio in the US stock market and low bond yields throughout the world, but the sort of gain in the gold price that would result from large-scale official-sector buying on the part of China would change everything. Bond yields would soar, stock prices would tank, and the US economy would plunge into recession. Knock-on effects would include a large reduction in the amount of Chinese goods purchased by US consumers, a recession and burgeoning unemployment in China, and, quite possibly, enough social unrest in China to threaten the survival of the current leadership.

What needs to be understood is that ALL of the world's central banks and governments have a vested interest in keeping the current monetary system going because it's a system that allows them to get something for nothing. As long as the vast majority of people have confidence in today's paper money, that is, as long as most people expect the money they use every day to do nothing worse than lose its purchasing power at the rate of 2%-4% per year, then the system will be viable and governments will be able to pay for their growth by creating money out of thin air.

The bottom line is that there are many good reasons to expect the gold price to move much higher over the next few years, but the buying of gold by China's Government is not one of them. And by the way, if China's Government ever did decide to break ranks and convert a meaningful portion of its US$ position into gold it would not publicise its intention.

'enron Of Spain' Fallout Ripples Into U.s. Markets

http://www.foxnews.com/story/0,2933,198526,00.html

Click on link to view full story.... shocking !!!

Smart Business Thinking

Before going to Europe on business, a man drives his Rolls-Royce to a downtown New York City bank and asks for an immediate loan of $5,000.

The loan officer, taken aback, requests collateral. "Well then, here are the keys to my Rolls-Royce," the man says.

The loan officer promptly has the car driven into the bank's underground parking for safe keeping and gives the man the $5,000. Two weeks later, the man walks through the bank's doors and asks to settle up his loan and get his car back.

"That will be $5,000 in principal, and $15.40 in interest," the loan officer says.

The man writes out a check and starts to walk away.

"Wait, sir," the loan officer says. "You are a millionaire. Why in the world would you need to borrow $5,000?"

The man smiles, "Where else could I find a safer place to park my Rolls-Royce in Manhattan for two weeks and pay only $15.40?"