SAN FRANCISCO - The waiting game for thousands of U.S. patrons with money tied up in an online payment service under federal investigation just got longer.

The U.S. Attorney's Office for the Southern District of New York late Wednesday said it extended the deadline until March 16 to decide whether to indict the co-founders of Neteller, an Internet money-transfer service popular among gamblers. Stephen Lawrence and John Lefebvre were arrested in January on a charge of conspiracy to transfer funds with the intent to promote illegal gambling

For U.S. customers of the site, it was another delay in their efforts to recoup their money, which remains in Neteller accounts until the legal matter is resolved.

Neteller says U.S. authorities have frozen access to about $55 million in U.S.-based accounts.

"As a result of the restrictions placed by third parties, court-ordered seizures and related legal concerns, (Neteller) is unable to make payments to U.S. customers," says a posting on the company's website.

FBI agent Neil Donovan has said funds are being held in court as potential evidence. He did not provide a timetable on when customers may get their money back.

Though money-transfer companies such as Neteller do business with financial institutions and merchants, many also allow gambling companies to transfer money collected from U.S. gamblers to bank accounts outside the USA. Neteller last month closed its U.S. Internet gambling services, erasing about two-thirds of its business.

A law signed by
President Bush in October bans the use of credit cards, checks and electronic fund transfers for Internet gaming. U.S. residents place more than half of all bets to major offshore casinos in an estimated $10.6 billion industry. However, most online gaming sites are based offshore, outside the reach of American law enforcement.

With Neteller's financial future teetering in the balance, consumers might choose less reliable money-transfer services instead, says Ken Dreifach, an Internet attorney.