Sign of the Times?

[rocketman]

or is this the U.S. trying to get a bigger piece of the gambling industry pie?


BETonSPORTS chief loses big
Authorities detain CEO David Carruthers, sending shares of the online gaming group down more than 20 percent.
July 17 2006: 7:06 PM EDT

LONDON (Reuters) -- David Carruthers, chief executive of online gaming group BETonSPORTS has been detained by U.S. authorities while changing planes, the company said on Monday, sending its shares down more than 15 percent.

"While changing flights in the United States en route from the UK to Costa Rica, David Carruthers, chief executive of BETonSPORTS Plc was detained by U.S. federal authorities," the company said in a statement.

"The board are currently seeking clarification as to the basis of the detention," it added.

A spokeswoman for BETonSPORTS which runs a large part of its operation from the Costa Rican capital, said the incident happened on Sunday night when Carruthers was on his way to San Jose, but could give no further details.

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.

The founder of BETonSPORTS.com, Gary Stephen Kaplan, 47, was also charged with 20 felony violations of federal laws, it said. A warrant has also been issued for the Kaplan's arrest.

Shares in the firm ended down 15.7 percent lower at 121.1 pence on Monday.

The news dragged down a raft of other Internet betting companies, including FTSE 100 share PartyGaming which lost as much as 5.5 percent. Midcap 250 stock 888 Holdings was down 3.5 percent.

The United States has also filed a civil complaint to obtain an order requiring BETonSPORTS to stop taking sports bets from the country and to return money held in wagering accounts to account holders in the United States, the Justice Department said.

U.S. District Judge Catherine Perry issued a temporary restraining order on Monday, with a hearing in the civil case requested within 10 days.

"Illegal commercial gambling across state and international borders is a crime," U.S Attorney Catherine Hanaway of the Eastern District of Missouri said. "This indictment is but one step in a series of actions designed to punish and seize the profits of individuals who disregard federal and state laws."

Last week Carruthers told Reuters he thought that a U.S. Republican-written, House of Representatives-approved bill to crack down on Internet gambling by banning banks and credit card companies from processing the payments was bound to fail due to the mountainous backlog of other U.S. legislation.

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[BuckarooBanzai]

Interesting article. Hadn't seen this before. I need to do a little more research before commenting.

Nice post.