U.K. Web Gambling Company's CEO Held in U.S.

Miscellaneous and Personal Stuff I Must Share
1

For people who were wondering in this thread how a crackdown on Internet gambling might come about, today saw an interesting development: Betonsports Plc’s announcement that Chief Executive David Carruthers was detained by federal authorities while changing planes in the U.S. en route to Costa Rica from the U.K. No word yet as to whether he’s been charged with anything, but I saw a report on one gaming website that he would be charged with violating RICO statutes. Coming in the context of last week’s passage by the House of an anti-Web-gambling measure, I find it hard to believe he was called in to discuss overdue parking tickets.

As the company’s name implies, Betonsports gets most of its revenue from acting as a sports bookmaker, although it also offers Web casino games and poker. For those who may not be aware, sports betting triggered what AIUI is to date the only case in which someone has been tried and jailed in the U.S. for running an illegal Internet gambling business. Jay Cohen, the former president of World Sports Exchange, was among people charged in 1998 and was convicted in 2000; he served a 21-month sentence after appealing all the way to the Supreme Court.

2

And this is another example of why changing planes in the US when traveling between two other countries can be very inconvenient.

Was what he’s doing legal in the UK?

3

Ridiculous. He’s not engaging in illegal activity on American soil.

4

I believe so.

5

Actually, he’s been indicted by a grand jury in Missouri.

http://money.cnn.com/2006/07/17/technology/betonsports.reut/index.htm?cnn=yes

Carruthers was in custody in Fort Worth, Texas, after a federal grand jury in the Eastern District of Missouri returned a 22-count indictment charging 11 individuals and four corporations on various charges of racketeering, conspiracy and fraud, the U.S. Department of Justice said in a statement.

6

Okay, that makes more sense.

7

I don’t understand why the US authorities waited for Mr. Carruthers to land on American soil.

If they had sent a letter to the UK government requesting his extradition we would have sent him across the Atlantic by return of post.

8

Web gaming stocks today:

PartyGaming -7.3% @ 95.5 pence after dropping as much as 14%
Sportingbet* -12% @ 247 pence after dropping as much as 24%
888 Holdings** -10% @ 172.75 pence after dropping as much as 14%
BETandWIN.com - 8.3% @ 49.86 euros after dropping as much as 17%

*Web bookmaker that owns Paradise Poker
**World’s biggest Web casino company, owner of the Casino-on-Net brand

9

Wow, thats a huge swing. The economies that benefit from legal online gambling are not going to like that.

10

I doubt this, actually. The United States, as a rule, doesn’t extradite its own citizens to stand trial in foreign countries for nonviolent crimes*, and we don’t expect Britain to send crown subjects here.

*This may not be true for Commonwealth countries, so I may be talking out my ass. I know for a fact that you really don’t want to have a shitload of unpaid parking tickets in Canada, and we have an extremely congenial relationship with the Australians. I know they won’t ship my ass to France, though.

11

The Natwest Three.

12

Yes you do. The US signed an extradition treaty with the UK, but has not yet ratified it, though the UK has. See link above. Furthermore, the alleged crime the NatWest Three committed was done on UK soil - same, I presume, as Mr BetOnSport. It’s a dodgy state of affairs.

13

Like I said, I was talking out my ass. I do know they won’t shop my sister for not covering her hair. (Yes, that actually came up.)

14

An update on today’s share-price carnage now that European markets have closed:

PartyGaming fell 17% to 83.25 pence.
Sportingbet* fell 35% to 182 pence.
888** fell 13% to 168.5 pence
Leisure & Gaming*** fell 23% to 71.5 pence.
BETandWIN fell 24% to 41.42 euros.

*Web bookmaker that owns Paradise Poker.
**World’s biggest online casino, owns the Casino-on-Net brand.
***Owner of the VIPsports brand.

If I were a really brave investor, I might be tempted to take a chance on Gaming VC Holdings SA, a Web casino operator that fell a mere 4.6% to 287.5 pence today. The Luxembourg-based company’s main markets are Germany and Austria, it doesn’t accept bets from the U.S., and best of all, it paid out a whopping 42 pence a share in dividends last year, making for an eye-popping yield of almost 15% at the current price.