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http://www.fortwayne.com/mld/journalgazette/business/17274710.htm
BetOnSports pleads guilty to federal racketeering charges
CHRISTOPHER LEONARD
Associated Press
ST. LOUIS – Internet gambling firm BetOnSports PLC has pleaded guilty to federal racketeering charges, U.S. Attorney Catherine Hanaway announced Thursday.Hanaway’s office has been pursing a 22-count criminal indictment against the London-based firm and its top executives since July. Her office settled civil charges against BetOnSports in November that permanently bars the company from accepting any bets from gamblers in the U.S.
BetOnSports’ founder Stephen Kaplan and Chief Executive David Carruthers remain under arrest and the company’s plea deal will not end their prosecution, Hanaway said.
Under U.S. federal law, companies like BetOnSports can plead guilty and be penalized in the same way individuals can be, said Jeffrey Demerath, an attorney representing BetOnSports in St. Louis.
Now that the legal case is settled and access to the U.S. market is banned, BetOnSports is going out of business, Demerath said.
“It is going to be wound up and closed down,” Demerath said.
BetOnSports refused to send attorneys to criminal hearings in St. Louis federal court, claiming that Hanaway had no authority to charge the foreign firm. The company took a majority of its bets from U.S. customers, but processed the wagers in offshore offices in Costa Rica and elsewhere.
“This plea constitutes a submission by the company to the U.S. justice system,” Hanaway said in a statement. “This plea, combined with the terms of the civil junction, should put an end to the BetonSports illegal gambling empire.”
The case has been closely watched by the online gambling industry, which generates about $6 billion annually in the United States.
Hanaway agreed to drop any further criminal prosecution of the company. In return, BetOnSports must supply witnesses and evidence in the pending cases against Carruthers, Kaplan and some lower-level defendants in the company.
Sentencing for BetOnSports is set for Oct. 19.
The company faces a fine up to $500,000 and possible forfeitures. The company also is subject to a permanent injunction that requires it to repay wagers received from U.S. gamblers held by the company as of June 1, 2006.
Kaplan has a detention hearing scheduled for 9:30 a.m. Friday before U.S. Judge Mary Ann Medler in St. Louis. Kaplan was arrested in March in the Dominican Republic and is charged with felony racketeering and fraud.
The charges are filed using a 1960s-era law known as the Wire Act, which prohibits placing bets on sports events over the phone.
Carruthers was arrested in July, shortly after Hanaway unsealed the criminal indictment against the company, which is publicly traded.
ON THE NET
U.S. Attorney Catherine Hanaway: http://www.usdoj.gov/usao/moe
Just saw this broke AFTER I filmed the webcast…
:bullshit:When I read the news about BoS, I thought I would be physically sick. I’m trying not to be judgmental on this. Either these guys sold their soul and David’s life for a little security or these things actually did happen, they really are guilty and they have evidence to prove it. I find myself leaning toward ‘really is guilty’ because in my mind I just can’t believe all of these men would consign David to prison just so that their lives can get back to normal and they could take in the rays on Miami Beach without worrying they’ll be slapped in jail. Would they??
Siouxzee I feel your pain…
…and I believe David’s fate has been predetermined by the “judge” in this case long ago… and it makes me sick and enragged as well… but…
I have always been outspoken that some things BOS did were downright stupid. They waved the red flag at a bull: Toll free numbers from America for sports bets… direct mailers from US soil to Americans with phone numbers… RV’s in parking lots of college football games where Americans could go in and place internet sports bets with them…
I like David and hope he gets off… but they tempted that bull one too many times and fianlly got slammed. I support this industry with my whole heart, but if anyone is truly guilty of anything, BOS is probably the best candidate.
I don’t think David’s defense will be built on the same items.
The racketeering has a lot to do with the early charges against Kaplan in NY, and we don’t know what racketeering in specific they plead guilty too. It may actually be earlier stuff, which would leave David out of the loop.
I think we don’t know enough to be speculating here…
We heard that BoS agreed to work with the district attorney because there is basically nothing more that they can give them as far as evidence against Kaplan and Carruthers. Not sure of the full details on this yet so don’t quote this post.
If you remember the name Marc Rich, a guy that Bill Clinton pardoned on his last day in office; it looks bad for david carruthers. Marc Rich fled the US (to Switzerland where he was also citizen), after his corporation pleaded guilty and agreed to testify against him. He always contended that because the corporation had sold him out in it’s plea, he couldn’t get a fair trail. He was smart enough to stay away from the courtroom and now he is safe again.
It sounds like carruthers is going to be made the example for all the English folks who think they are “immune” to US law. Unfortunately his high public profile made him a perfect target, an example to be set and federal prosecutors love to set examples and get on television.
AmCan wrote:…federal prosecutors love to set examples and get on television.I would normally agree with you 100%, but I don’t think the Feds really want too many public eyes on this case. Industry eyes, yes… but not public eyes.
So much for David’s right to a speedy (almost a year since his arrest) and public (almost no coverage by media other than a few newspapers) trial, by an impartial jury (in St. Louis, Missouri? Ya right…) of the State and district wherein the crime shall have been committed (do I even have to go into this?)…
But silly me… we can’t just start throwing things like law and the constitution into the governments case… :rolleyes:
There is an interesting news post here regarding Kaplan:
