BetOnSports fined $28 million, gets probation

Dec 02, 2009

(AP) -- Defunct online gambling site BetOnSports.com has been sentenced to probation and a $28.2 million fine that lawyers on both sides say probably will never be paid.

Company founder Gary Kaplan was sentenced last month to 51 months in prison and he agreed to forfeit $43.65 million. He pleaded guilty in August to conspiracy, racketeering conspiracy and violating the Wire Wager Act for running what once was one of the world's largest offshore sports companies.

On Tuesday, a placed BetOnSports on probation for five years and issued the fine. But the company says it has more liabilities than assets, and its lawyer says it still owes U.S. gamblers $7 million to $8 million.

Assistant U.S. Attorney Steve Holtshouser told the St. Louis Post-Dispatch that the real amount of money owed to U.S. gamblers probably is much higher. He estimated that only about half of those gamblers went through the steps to verify money owed to them.

Others, he said, may have been concerned about whether their bets were legal or were skeptical of ads and e-mails asking the gamblers to provide the company with proof of what they were owed.

In 2006, Kaplan, the company and other employees were indicted in St. Louis on federal charges accusing them of running an illegal gambling operation. Prosecutors said the business handled more than $1 billion in wagers a year through Web sites and phone lines.

In a civil settlement that year, the company agreed to stop taking U.S. bets. In 2007, the company pleaded guilty to a racketeering conspiracy charge.

Former CEO David Carruthers pleaded guilty in April to racketeering conspiracy, but hasn't been sentenced. Kaplan's brother and sister pleaded guilty in June to two felony conspiracy charges and were sentenced to 10 months house arrest. They also agreed to turn over more than $6 million held in Swiss bank accounts.

Federal prosecutors had been investigating offshore sports gambling since 1997 and BetOnSports since 2001.

Online gambling is illegal in the U.S., but prosecutors said BetOnSports misled gamblers into believing that money transferred to the company was safe and available to withdraw at any time.

Instead, investigators said, the money was used to expand operations, including the purchase of a rival betting firm.

©2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Explore further: Study shows role of media in sharing life events

add to favorites email to friend print save as pdf

Related Stories

Ex-CEO of BetOnSports pleads guilty

Apr 01, 2009

(AP) -- The former chief executive of BetOnSports pleaded guilty Wednesday to federal racketeering conspiracy, admitting that the Internet company falsely portrayed Web-based gambling as legal and caused customers to lose ...

BetOnSports.com founder gets 4-plus years

Nov 02, 2009

(AP) -- The founder of the online gambling site BetOnSports.com was sentenced Monday to more than four years in prison, ending a lengthy investigation and prosecution into one of the world's largest offshore sports gambling ...

Accused spam scammer pleads guilty in Detroit

Jun 23, 2009

(AP) -- A Michigan man described as one of the world's most prolific senders of spam e-mail has pleaded guilty to charges accusing him of defrauding people by manipulating Chinese stock prices.

California company fined for pollution

Jun 15, 2007

A California refinery has been fined $1 million for threatening groundwater supplies by dumping oil refinery waste into its wells, U.S. officials said.

Recommended for you

Study shows role of media in sharing life events

2 hours ago

To share is human. And the means to share personal news—good and bad—have exploded over the last decade, particularly social media and texting. But until now, all research about what is known as "social sharing," or the ...

UK: Former reporter sentenced for phone hacking

9 hours ago

(AP)—A former British tabloid reporter was given a 10-month suspended prison sentence Thursday for his role in the long-running phone hacking scandal that shook Rupert Murdoch's media empire.

Evaluating system security by analyzing spam volume

9 hours ago

The Center for Research on Electronic Commerce (CREC) at The University of Texas at Austin is working to protect consumer data by using a company's spam volume to evaluate its security vulnerability through the SpamRankings.net ...

Surveillance a part of everyday life

10 hours ago

Details of casual conversations and a comprehensive store of 'deleted' information were just some of what Victoria University of Wellington students found during a project to uncover what records companies ...

European Central Bank hit by data theft

10 hours ago

(AP)—The European Central Bank said Thursday that email addresses and other contact information have been stolen from a database that serves its public website, though it stressed that no internal systems or market-sensitive ...

Twitter admits to diversity problem in workforce

13 hours ago

(AP)—Twitter acknowledged Wednesday that it has been hiring too many white and Asian men to fill high-paying technology jobs, just like several other major companies in Silicon Valley.

User comments : 0