Bartiromo, who friends described as an avid sports memorabilia collector with his father, told investors he was betting on professional football games and other sporting events.
"He would list the positions he had on upcoming games on the forum," Terry said. "He would say how much he was betting on a team and that he was covering his bets in various ways, sometimes making two or three bets on the same game."
Bartiromo would paste copies of betting forms from a Las Vegas sports book on the Web to convince investors that he was putting money into wagers, Terry said. But it isn't known whether any bets actually were placed.
Teen's Family Had Financial Problems
Bartiromo used a system of juggling funds between numerous e-commerce sites to evade regulators, according to an e-mail he sent to one investor.
The funds "are almost always in transit, being transferred from a sports book and back," Bartiromo said in the e-mail. "When they are transferred back, even then, we hold all the funds in a 'unknown' account to the public to protect the funds from hacking attempts which could freeze accounts and delay the program. Also, this protects us against Big Brother or the SEC or what have you ever being able to freeze funds, as they will not be able to get to them."