E-gold and Operators Indicted: E-gold Hits The Wall Part Deux

Yesterday, I posted some information and opinions that ‘e-gold had hit the wall’.

It was clear early in the day that many large e-gold accounts had been frozen or blocked by a US government action. Additional information early in the day on why or how government authorities ‘froze’ the accounts was unknown.

Late yesterday afternoon the Justice Department put out a press release stating what action had taken place. This information enlightened us all on why the e-gold exchange agents’ accounts had been frozen and what may happen to e-gold Ltd. from this day forward.

Many facts are still unclear and everyone who reads this should remember that persons indicted are innocent until proven otherwise. So any mischief discussed here is only alleged to have occurred. Also understand that a grand jury is a tool of the prosecution. Grand jury indictments are not the final word they are the first word.

What happened?

Early Friday, it was reported on the 1MDC web site that major e-gold exchange agents’ accounts, including 1MDC, had been frozen by a US Government court order or similar document. Later in the day Friday, several news organizations released stories based on the Department of Justice press release.

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. *usdoj.gov

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. *prnewswire.com

What account were frozen?

The accounts that were targeted by the investigation and alleged to have been involved with the illegal activity were frozen and that appears to have been only accounts owned by some larger exchange agents and the 1MDC account(s)

“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.” * prnewswire.com

Is e-gold still in business?

There was no official information release from e-gold, Gold & Silver Reserve or OmniPay yet. Their web site is still up! No one knows yet.

Can I get the funds out of my e-gold?

It would appear YES, but no one is sure if you can liquidate immediately. I would think if you can transfer the digital money to an exchange agent and they are willing to pay you, do it.

The information reads that only the frozen accounts will be restricted, all other regular accounts are still open and contain value. Plus it seems the .gov is not limiting e-gold exchanges to agents when ‘cashing out’. It even goes further to say they[e-gold] are permitted to sell the gold bullion secured in the vaults to cover ‘cash outs’.

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.” *pr-inside

Not to fear….your funds look safe, however the last line above says, “…once approval has been received.” I’m not sure if that means the court has to approve the sale of gold and/or disbursements of funds. That’s unclear. It seem the funds are safe but may need approval from the .gov before they can be liquidated, its not clear.

It does NOT appear that OmniPay will be accepting any national currency for ‘inexchanges’ or buys if someone was so stupid to attempt a buy. It seems that they may be accepting e-metal for legal customer ‘outexchange’ but no one has confirmed it yet. But as the wording reads above, they[e-gold] will be allowed to convert e-gold back to national currency for the existing account holders. Until someone points out different I assume that is the case. And why wouldn’t they allow it, with the IRS and other law enforcement operations sitting waiting for clients to accept those funds:-)

Is 1MDC out of business?

Yes, 1MDC accounts that were backed by e-gold…..the e-gold was frozen/seized. That part of 1MDC is over. I don’t know how they are progressing with Pecunix or other currencies but perhaps we’ll get an update next week.

All funds that were in 1MDC, are they gone or can I get them back?

Good question, anyone know?

Where do we go now for our online businesses?

• Webmoney

• Liberty Reserve

• Loom

• eCache

• e-bullion

• Pecunix