Antigua And Barbuda FSRC To Oversee BetOnSports Settlement

by Leroy Baker, Tax-News.com, New York

21 February 2007

The Antigua and Barbuda Financial Services Regulatory Commission (FSRC) has announced that it is assisting and supervising BoS (Antigua) Ltd (BOS), the operator of the BetonSports family of remote gaming products, in the process of the collection of funds owed to BOS and the onward payment of collected amounts to BOS creditors and employees.

In a statement, BetonSports said that the process has been implemented under the supervisory authority given to the FSRC, in order to give extra reassurance to organisations that funds returned will be properly used in the settlement of creditors in line with legal requirements, as well as ensuring that BOS creditors will be paid in a fair and balanced manner.

Presently, BOS has been unable to repay customers due to cash-flow constraints, along with legal and operational interruptions. A substantial amount of monies owed to BOS by payment processors and publishers have not been repaid, and it is anticipated that the oversight of the process by the Commission will give these organisations the transparency and reassurance they are seeking in order to return funds, so they may be distributed appropriately. The Commission, under an order received by the Eastern Caribbean High Court of Justice, will manage and supervise all funds remitted. The Commission and BOS Directors will be communicating with all account debtors directly. After evaluating, and verifying the obligations to creditors of BOS, these funds will then be paid in the legally prescribed order by the Commission.

Kaye McDonald, Director of the Financial Services Regulatory Commission, Division of Gaming noted: “We are pleased with the agreement of BOS’s Directors to cooperate with Antiguan and Barbudan authorities to ensure the proper discharge of creditors, namely players and employees in this difficult case. As regulators, it is our responsibility to ensure that licensees operate properly at all times even under adverse conditions. We expect that our involvement and the cooperation of BOS will encourage the prompt payment of amounts owed to BOS by payment processors and others, so that funds can be promptly returned knowing that they will be distributed properly.”

McDonald added: “We expect BOS debtors to cooperate with the process, and I am sure BOS is prepared to use all legal remedies available, to ensure that they do so.”

Director of BOS, Clive Archer, added: “We are pleased to be working with the FSRC to ensure that customers, staff and other creditors receive the money they are owed. We have been hampered by the slow return of funds owed to us and we hope that this process will give debtors the reassurance they need to swiftly pay, so that our creditors including our customers and staff can be paid. It is extremely sad that such a great business has been destroyed in this fashion but we are committed to ensuring to the best of our ability that it ends properly."

Archer concluded: "We are happy to cooperate with the supportive staff of the FSRC and believe that they are best suited, as the regulatory authority to ensure that all are treated fairly. We know that the business is all about customers and staff and we want to ensure they are properly looked after.”

An US court order has banned Betonsports from operating in the United States. "The defendant has no legally recognizable right to operate in the United States," wrote the judge. However, the agreement permits the company to refund stakes placed by US players; originally the Justice Department had wanted to seize those funds.

BetonSports and 12 individuals still face criminal charges including racketeering, mail fraud and facilitation of gambling across state and national boundaries. Trading of BetonSports stock in London was suspended in July 2006 at the company's request. The company ran its US Internet business from Costa Rica and Antigua.

Founder Gary Kaplan and British CEO David Carruthers are among those indicted. Carruthers, 48, was arrested last July as he changed planes in a Dallas airport. At a hearing in August, Carruthers pleaded not guilty to the charges of fraud and racketeering in St Louis. Under the terms of a bail agreement negotiated between defense lawyers and prosecutors, Carruthers was bailed under a $1 million bond and is under house arrest in the vicinity of St Louis. An arrest warrant was also issued for Gary Kaplan. The indictments seek forfeiture of $4.5 billion from Kaplan and the other defendants.

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