UPDATE: Carruthers charged with racketeering and conspiracy. -eGaming

[SBR_John]

News Alert: Carruthers in court
David Carruthers, outspoken chief executive of BetonSports, has appeared in court in Fort Worth, Texas, in an initial hearing before a Federal magistrate on charges of racketeering and conspiracy.
At the brief hearing, the judge ordered a detention hearing for this coming Friday at which it will be determined whether Carruthers gets bail or stays in Federal custody.

The charges formed part of a sealed indictment that has come from the St Louis, Missouri and makes reference to co-conspirators.

According to one industry source, there are nine names on a list. The nine are all believed to be family members and associates of the company´s founder Gary Kaplan. "This is very much a company-specific issue, related to Gary Kaplan and his family" said the source.

As eGaming Review reported throughout Monday, July 17, Carruthers was detained at Dallas Fort Worth airport late on Sunday afternoon while on route from the UK to Costa Rica. He was detained by members of the Federal Bureau of Investigations (FBI) and the Internet Revenue Sercie (IRS). Hs is believed to have spent the night in the county jail.

Earlier in the day, One legal source suggested the arrest was "startling". "To arrest a UK citizen is a substantial deviation from known practice." Another legal source added: "The Department of Justice has gone too far. David Carruthers is a UK citizen and this is not illegal where he is: he is licensed, it´s a publicly traded company and we´ve got a crisis in the Mid East, another one in Korea and of this is what our government wants to spend our money on."

Susan Breen, partner at Misscon de Reya suggested the move against

The sector´s share prices were hit hard by the news, and in particular those with US sports betting businesses. At the close in London, BetonSports was down nearly 17% at 122.5p, Sportingbet was down 13% to 282p and Leisure & Gaming was down 17% to 92.5p. In comparison, PartyGaming was only down 5.5% to 103.

Analysts suggested it was unfortunate the other company´s in the sector had been embroiled in the matter.

[SBR_John]

Can someone explain and give an example of what you would do to be guilty of racketeering?

[Willie Bee]

John, racketeering is a pretty broad brush applied to certain crimes these days. People naturally assume it has to do with organized crime families since that's where the term, and the RICO laws, grew from to begin with. But the DOJ filed racketeering suits against tobacco companies and even that music file-sharing group Kazaa in the past few years.

Can't be sure what their basis is on the BOS group, and this is certainly going to create a sticky wicket since it involves UK citizens. Speculating here, but there's very likely some evidence of a conspiracy to commit fraud or deceptive business practices.

I think it's a bit of a smoke screen to draw some attention away from the Middle East, North Korea, etc., at the moment.

I'm not a lawyer, but I did stay at a Holiday Inn Express last night

[Ron E.]

Can someone explain and give an example of what you would do to be guilty of racketeering?

These laws are used in prosecuting organized crime

I would venture a guess that in this specific case, this would apply

2085 Syndicated Gambling

1. Syndicated Gambling: Sections 801-811 of the Organized Crime Control Act of 1970, which amended Title 18, United States Code, by adding Sections 1511 and 1955, are designed to combat "illegal gambling business" or syndicated gambling. Title 18, U.S.C. § 1511 is directed at the political and police corruption which makes widespread illegal gambling possible, while Title 18, U.S.C. § 1955 is directed at the illegal gambling itself.

http://www.usdoj.gov/usao/eousa/foia_reading_room/usam/title9/110mcrm.htm

[Sean]

Eleven Individuals and Four Corporations Indicted On Racketeering, Conspiracy And Fraud Charges
7/17/2006 5:34:00 PM

WASHINGTON - A federal grand jury in the Eastern District of Missouri has returned a 22-count indictment charging 11 individuals and four corporations on various charges of racketeering, conspiracy and fraud, the Department of Justice announced today. The indictment was returned on June 1, 2006, and unsealed today.

BetonSports PLC, a publicly-traded holding company that owns a number of Internet sportsbooks and casinos, was among the companies charged in the indictment. The founder of BetonSports.com, Gary Stephen Kaplan, 47, was charged with 20 felony violations of federal laws including: the Wire Act, Racketeer Influenced and Corrupt Organizations (RICO) Conspiracy, interstate transportation of gambling paraphernalia, interference with the administration of Internal Revenue laws and tax evasion.

More

[Sean]

In conjunction with the indictment, the United States has filed a civil complaint in federal court to obtain an order requiring BetonSports PLC to stop taking sports bets from the United States, and to return money held in wagering accounts to account holders in the United States. U.S. District Judge Catherine D. Perry issued the temporary restraining order today. A hearing in the civil case has been requested within 10 days. As authorized by federal statute, the FBI is issuing letters to four telephone companies, instructing them to stop providing phone service to the Internet sportsbooks and casinos operated by BetonSports PLC.

Source

[Chuck Sims]

I cannot tell you how broken up I am about this news. BetOnSports has made a fortune from stiffing people.

Message to David Carruthers: Time to Pay the Piper, Boy.

[Santo]

Big Picture Chuck, Big Picture..

[chano]

The United States of America has there priorities so out of order its not even funny anymore. Unbelievable!!

[Chuck Sims]

Big Picture Chuck, Big Picture..

Santo, I hear ya.

[SBR_John]

This is a terrible day for the industry. One reason it is terrible is because you have these thief types drawing the attention of law enforcement that would prefer to look the other way.

Now there is a rumor that the undercover agent was stiffed out of his bonus. How shocking is that?!

From my perspective any move that removes a thief from the industry is a good one. Future players will be safer after BoS is taken offline. Hopefully law enforcement will only focus on the dishonest operations but that's not a safe bet.

[Dark Horse]

A pretty reliable thermometer for political events is the Tradesports exchange. In the past this has proven to be much more accurate than polls. Guess what. The anti-gambling legislation passing is estimated at, tops, 25% right now. The general impression is that there isn't enough time left in the political year.

As to Carruthers, I find it quite encouraging that they seem to have known precisely who to pick out. But we could only know for sure if we had numbers on other sportsbook owners changing flights in the US.

[Donny]

Many people with money and bonus rollovers left there wishing they would have listened to guys like John and Chuck, instead of all the BOS shills at the RX, TOW etc etc...

Imo this would have never happened to a respected book, iam sure the FBI chose BOS because they know they are crooks.
Imagine the reactions if it was f.e. Bodog, they would take a lot of heat. But BOS? Many are happy about this.

Maybe even the SBR rating played a small role, who knows, and those are the times to thank the honest people who warned players to stay away from BOS.

[chano]

We work for our money (some of us do). We should be able to spend it anyway we like. If I choose to entertain myself by placing a wager on a football game, then leave me to it. They should spend our tax money on finding the motherfuckers who crashed planes in our towers. This is unreal. U.S at it again.

[SwampyJ]

I think it's a bit of a smoke screen to draw some attention away from the Middle East, North Korea, etc., at the moment.

As of right now, I do not believe it is a smoke screen for 2 reasons.

1) I have not seen this story mentioned in any of the national TV media.

2) The man arrested at the airport, I bet, just fell into their laps. I imagine when he came thru customs his passport was flagged. So, basically he determined the time for this raid.

[Willie Bee]

But we could only know for sure if we had numbers on other sportsbook owners changing flights in the US.

Excellent

But I disagree with the notion that players can relax because there isn't enough time left before elections. A bazillion things can change or take place between now and Nov 7th. Find a photo of Tom DeLay and Rick Perry fornicating farm animals on Nov 6th, and you could wind up with Democrat Tom Lampson winning one of the staunchest GOP Congressional Districts in the country and find Kinky Friedman in the by gawd Lone Star State Guv'nuh's Mansion.

If this administration and the GOP fat cats want to make passage of an anti-gambling bill a hot button issue, they could get some bill to the Senate floor before the midterm balloting. Thinking that it won't or can't get to the Senate floor in some form before then might be the best bet, but it's also dangerous to relax and just assume that. My only defense is that if someone votes for it and they're on the November ballot, pick the other guy.

[Chuck Sims]

"Many people with money and bonus rollovers left there wishing they would have listened to guys like John and Chuck, instead of all the BOS shills at the RX, TOW etc etc..."

Thanks Donny. If so called watchdog sites act irresponsible like they have been when they sold out to the crooks of the off-shore industry how can we not applaud the arrest of the crime family boss? Let the chips fall where they may.

Crooks need to be put out of business by any means neccessary.

[JoshW]

Many people with money and bonus rollovers left there wishing they would have listened to guys like John and Chuck, instead of all the BOS shills at the RX, TOW etc etc...

Imo this would have never happened to a respected book, iam sure the FBI chose BOS because they know they are crooks.
Imagine the reactions if it was f.e. Bodog, they would take a lot of heat. But BOS? Many are happy about this.

Maybe even the SBR rating played a small role, who knows, and those are the times to thank the honest people who warned players to stay away from BOS.

I really don't think it has to do with their conduct toward players, but would be great it if it was. In almost all cases it is about the government. Either they are pissed about them taking bettors from the US or they are pissed because someone isn't paying taxes when they shouldn't. If it was for anything else I would be shocked.

[drunkguy]

As of right now, I do not believe it is a smoke screen for 2 reasons.

1) I have not seen this story mentioned in any of the national TV media.

2) The man arrested at the airport, I bet, just fell into their laps. I imagine when he came thru customs his passport was flagged. So, basically he determined the time for this raid.

it is all over the place

Forbes and WSJ had it covered pretty decently today


It is now listed as the 5th "Top Story" on CNN's main page



while it is not a smoke screen, it is definitely a political move more than a singular prosecution

[isetcap]

This is a fundamental shift in the US policy against offshore gambling and we are only witnessing the first of more actions to come. In the same manner that the authorities went after organized crime units many decades ago (tax evasion), the FBI in conjunction with the IRS will put together as many cases as possible against the "gambling families" of today.

In light of some of his more recent interviews, I would strongly advise Calvin Ayre to plan any of his future travels around the US borders as opposed to through them.

[polarcita]

DOJ headline : Man Bites Dog

This investigation has been going on for years and principally is directed to Kaplan and his activities in the U.S. Nabbing the CEO of a publicly traded company in the UK makes for a lot more publicity. Wanna bet that they are merely pressuring Carruthers for more info and will let him go shortly?

DOJ news release:

http://www.usdoj.gov/opa/pr/2006/July/06_crm_443.html

Thanks for keeping this thread on target without all the BS in the other forums.

[BadAzz]

Could you help me to understand what the man is accused of? Is he arrested because he has done something fishy or is it because he is running a licenced online sportsbook?

[SBR_John]

Could you help me to understand what the man is accused of? Is he arrested because he has done something fishy or is it because he is running a licenced online sportsbook?

Thats a good question. I think Carruthers will walk. The real illegal activity, the bookmaking charges in the US, are well before his time.

[SwampyJ]

it is all over the place

Forbes and WSJ had it covered pretty decently today


It is now listed as the 5th "Top Story" on CNN's main page



while it is not a smoke screen, it is definitely a political move more than a singular prosecution

I stand corrected regarding the media coverage. However, it is being portrayed as business news rather than political news.