Philanthropist John Lefebvre, known on the University of Calgary campus for his $1.2 million donation to the faculty of fine arts in 2005, has been arrested in the U.S. on money-laundering charges.
Lefebvre, a former U of C Students’ Union president, faces charges of conspiring to transfer funds with the intent to promote illegal gambling in connection with the operation of an internet payment services company called NETeller PLC, according to a release from the U.S. Attorney’s office in the Southern District of New York.
Both the operation of online gambling businesses and the transfer of proceeds oversees are illegal in the U.S.
According to the statement, U.K.-based NETeller has facilitated the transfer of billions of dollars in gambling revenue from U.S. citizens to banks outside of the U.S. since Lefebvre co-founded the company in 1999 with Stephen Lawrence. Lefebvre was arrested in his Malibu, California, house Mon. Jan. 15. Lawrence was also arrested in the U.S. Virgin Islands. Both are Canadian citizens.
According to NETeller’s 2005 annual report, the company posted a profit of over $91 million in 2005 alone, and provided services to over 80 per cent of online gaming merchants world-wide.
Lefebvre donated $1.2 million to the U of C’s faculty of fine arts in October 2005, after selling his approximate 13 per cent share in NETeller.
U of C vice-president external relations Roman Cooney refused to speculate on whether the $1.0.2 million could be in jeopardy pending the resolution of the court case, but said the donation has already been received and the projects it was meant to fund are underway. “The $1.2 million he gave us has already been provided,” said Cooney. “I have no concerns about that.”
Lefebvre’s donation was earmarked for funding student projects, setting up four new fine arts entrance awards and a distinguished professorship, as well as refurbishing a new rehearsal and presentation studio in Craigie Hall.
When Lawrence and Lefebvre took the company public, they acknowledged in investor documents that they were risking prosecution by the U.S. over their business practices.
“Stephen Eric Lawrence and John David Lefebvre knew when they took their company public that its activities, as well as those of the internet gambling companies it assisted, were illegal in the United States,” said U.S. State Attorney Michael Garcia in the statement. “Blatant violations of U.S. law are not a mere ‘risk’ to be disclosed to prospective investors.”
According to internet reports, Lefebvre was released on $5 million bail under the condition that he surrender his passport, and has been ordered to appear in court Fri., Jan. 26.