Apr.17, 2010, 9:44PM

An Australian man faces up to 75 years in jail on charges of helping US gamblers and internet gambling websites launder $US500 million ($A535 million).

Daniel Tzvetkoff was arrested early on Friday for bank fraud, money laundering, conspiracy and other charges that carry a potential penalty of 75 years in prison.

Prosecutors said the 27-year-old defendant in 2008 began disguising transactions to banks on behalf of gamblers so they would appear unrelated to gambling.

They said he bragged in an email that his system was "all perfect!"

Prosecutors say he stopped processing gambling transactions in March 2009 after gambling websites accused him of stealing about $US100 million ($A107.02 million).

The Queensland IT entrepreneur appeared in a federal court and was detained until a bail hearing on Wednesday, News Ltd reported.

Ipswich-born Tzvetkoff was distraught and planned to apply for bail, his lawyer Mace Yampolsky told News.

Mr Yampolsky said the allegations were certainly fantastic but were only allegations at this point.

"At this stage of the game, it's difficult to know exactly what type of evidence is out there, Mr Yampolsky told Dow Jones Newswires.

"They are only allegations. I can't comment any further on the veracity of them."