News

Tuesday, 16 November 2010 09:15

Shamed ex-payment processor boss of Intabill, Daniel Tzvetkoff has finally come clean to US authorities about $50 million he has buried in a defunct payday loans company.

It seems the incentives of a possible 75 year jail sentence coupled with the birth in June of his second child has loosened his tongue after he kept very quiet for five months about the missing millions while he was sitting in jail. The threat of the lengthy jail term, which he faces courtesy of the money laundering charge for his part in the $500 million scam affecting several top online poker companies and their customers, was the straw that broke this particular camel's back.

Arrested while attending an Internet billing conference in Las Vegas back in April this year, Mr Tzvetkoff was initially given bail but had it revoked days later as the court decided he was a flight risk. After languishing in jail for five months to contemplate his choices determining his ultimate fate, Tzvetkoff finally cut a deal and told authorities about the payday loans company he set up in Las Vegas in June 2008.

Named Hugo Services after his son, he got the finance company off the ground with a loan of $27 million from BT Projects, one of his other companies. It was a runaway success and within nine months had practically doubled its investment. Hugo Services was then shut down in March 2009 allowing its accounts to lay dormant to this day.

It is believed the FBI wants to seize the dormant funds before the major poker companies can start their legal claims, with Full Tilt Poker looking to recoup a debt of over $60 million from Mr Tzvetkoff.

It also turns out that Nicole Crisp, Tzvetkoff's partner and mother of his two children, controversially sold a Hedges Avenue apartment she owned in the Gold Coast for $1 million to pay for his legal representation in the case. This was less than half of the $2.3 million a trust that she controlled had paid for it 3 years earlier. The apartment's sale, which came just weeks after Tzvetkoff's arrest, was a major part of an ongoing liquidator's inquiry into one of his companies, BT Projects. The sale was pushed through quickly to raise the cash as an up-front-payment to his lawyer who demanded it to take the case.

Despite the allegations about millions of dollars Mr Tzvetkoff may have hidden away in offshore banks, many sources believe the former entrepreneur is in fact broke. It is also understood that due to the potential litigation's complexity, the liquidators for BT Project may not go after the missing money.