E-gold trubles again . It’s only matter of time.
Well, a lot of us knew it was coming… With all the rumours flying around about EGold Ltd; Gold & Silver Reserve, Inc, people knew deep down that something must be happening. Today E-Gold’s Owners: Dr Douglas L. Jackson, Reid A. Jackson and Barry K. Downing have been indicted for money laundering and illegal money transmitting. However, this sounds a lot worse than it actually is. The definition of Indict is: (of a grand jury) to bring a formal accusation against, as a means of bringing to trial. So basically the government has made an accusation against e-gold which they feel confident enough with to make it ‘formal’. This is one of the many ways of forcing a trial.
In my opinion, the US government wouldn’t make any sort of formal accusation unless they had some ‘dirt’ that is good enough to hold up in court. Nowadays, making an formal accusation is risky on the terms that if your wrong, you will probably get sued (remember this is in the USA). Even though the government knows E-Gold and what goes on, they haven’t been able to bring the owners to a court of law yet due to a lack of substantial, credible evidence. It became clear that the US government was out to shutdown E-Gold when the FBI began their first raids in 2005. Since then the US Government has been forcing its way inside E-Gold’s doors and been constantly monitoring the flow of Gold between accounts and agents.
The fact that 24 seizure warrants and over 58 e-gold accounts were frozen is a big red warning sign for me. Considering the likes of 1mdc, Icegold and Omnipay (a minority of the largest E-Gold agents) are all now enjoying frozen accounts means something big has gone down. Most of the large exchangers have been shutdown and those that remain are facing bankruptcy. 1MDC are making wild claims about how ‘the end is near’ for all Digital Gold Currencies as you can imagine… Icegold have simply made a new E-Gold number and carried on business as normal and the others have either packed up or suspended exchanges.
The impacts of the big seizures will be huge. The immediate impact was a sudden selling of E-Gold. It could have been the next black Wednesday. Luckily for E-Gold most of its users are quite used to ‘accusations here and raids there’ so many users were not vastly shaken by the event and retained some confidence. The long term affects are much larger. Hundreds of thousands of debit cards are funded via e-gold and their exchangers. Due to the credit becoming void lawsuits may arise if the agents haven’t covered themselves in the terms and conditions. One of the hard truths is that E-gold will perhaps become unable to cover costs due to the huge plummet in business – people will view this event as instability in E-Gold and many have started out exchanging their gold. Those who have strong loyalties to E-Gold may be the ones that loose out big time if E-Gold suffers. With E-Gold’s main agents out the game as well, a huge amount of income will be lost in commissions.
The beginning of the end of E-Gold’s reign may have just kicked off. As mentioned in a previous post, the FBI, secret service and IRS have been collecting huge amounts of data as evidence against E-Gold. Now they feel comfortable enough to finally begin taking legal action.
Additional information : here
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Wow, i never knew this about e-gold. Maybe i should withdraw all my money!