Last month we began to chronicle the sad tale of NETeller, an international money transfer and payment processing company and that of one of its founders, Stephen Lawrence. We want to use the plight of NETeller and of Lawrence as an illustration of the not so nice side of the Transaction Processing Industry.

To recap, Lawrence recently pleaded guilty to racketeering, but then had the audacity to tell the courtroom, "I came to understand that providing payment services to online gambling Web sites serving customers in the United States was wrong."

It is at this point that we pick up this saga.

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Calvin D. Johnson, Publisher
publisher@tpatlanta.com
Trans Atlantic Systems, Inc.

Now that the easy money in home mortgages is all but over, consumers may soon be caught in a financial squeeze with their credit cards. That's the worry among some economists and credit counselors as home lending has shifted abruptly into low gear this summer. That leaves homeowners owing big sums to Visa or MasterCard without an important escape hatch -- the ability to pay down the plastic by dashing off a check from their home equity line of credit or rolling the debt into a new, bigger mortgage.

"You're not going to be able to get that mortgage loan. You'll be stuck with the higher interest credit card debt," warns Carl Steidtmann, chief economist with Deloitte Research. "We will have to live within our means. I know it's a troubling phenomenon. But we're not going to be able to spend at levels well above our income levels."

Home mortgages have become much harder to get this summer as a wave of overleveraged homeowners, many of them with adjustable-rate loans, have defaulted on their home loans. As foreclosures soared, numerous lenders had difficulty raising new capital, and some have closed up shop. Others have tightened their requirements on borrowers and bumped up interest rates, which could decrease how much money a prospective buyer can borrow.

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