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DOJ Settles With Betonsports

by Mike Godfrey, for LawAndTax-News.com, Washington

14 November 2006


The agreement between the US Justice Department and Antigua-based gaming firm Betonsports settling civil litigation against the company was approved by US District Judge Carol Jackson in the St Louis federal court last week.

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

The company 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 on July 18th 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 in 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 has been issued for Gary Kaplan. The indictments seek forfeiture of $4.5 billion from Kaplan and the other defendants.

A number of other UK-listed companies have said that they were ceasing US operations in light of the law passed in the Congress in September which effectively bans them from taking US bets; the law was signed by the President in October.


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