Mashable has the story in some depth
here, picking up on a
piece in PC World.
The precis is: when PayPal took a dominant market share of internet payments it could then afford to adopt the moral high ground and turn away the seamy side of the marketplace. By default
E-Gold (based in Nevis) was forced to scratch about for customers and as a result became popular with various different flavours of internet scamsters.
Of course, e-Gold founders had a choice in this matter but weren't too discerning in their vetting of customers. Or, as they plead, a design flaw in the system made it tough for them to turn away the wrong sort of customers.
Now they are pleading guilty to money laundering charges and are facing fines and jail terms ranging from five to twenty years. E-Gold's own blog does its best to find a positive spin on the pending outcome
of the case and changes made to the business as a result.
Finextra
covered the initiation of proceedings back in April 2007.