Internet gambling boss gets prison time

The former director and CEO of BetOnSports.com, a large offshore sports betting business, has been sentenced to 33 months in prison for his role in running the illegal gambling operation.

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The former director and CEO of BetOnSports.com, a large offshore sports betting business, has been sentenced to 33 months in prison for his role in running the illegal gambling operation.

David Carruthers, a British citizen, pleaded guilty in a US court to one count of racketeering conspiracy. He was the first major defendant in the prosecution to plead guilty, and he agreed to testify against the other defendants, the US Department of Justice said in a press release.

In November, BetOnSports founder Gary Stephen Kaplan was sentenced to 51 months in prison on multiple charges. Kaplan hired Carruthers as CEO of BetOnSports.com in about June 2000.

The DOJ has targeted BetOnSports, which was based in Costa Rica, for running an illegal Internet-based gambling operation. Online gambling is illegal in the US.

BetOnSports advertised "heavily" to solicit US residents to place sports wagers by telephone and over the Internet, the DOJ has said.

BetOnSports attracted a large number of US customers. By 2004, the company's headquarters in Costa Rica employed about 1,700 people. In 2003, BetOnSports had close to 1 million registered customers and accepted more than 10 million bets totalling more than $1 billion, the DOJ said.

“The prosecution and conviction of Carruthers is significant to the Government’s efforts at enforcement of US laws against offshore Internet and telephone sports wagering businesses, because Carruthers was both a foreign national and a top executive of BetOnSports,” Assistant US Attorney Steven Holtshouser said in a statement. “Previously, executives, owners and investors believed that they were immune from the reach of law enforcement; even their business plans were directly aimed at the US market."

"Both the conviction of, and sentence handed down against Mr. Carruthers should send a message to any foreign business conducting illegal activities in the United States, that geography does not render it untouchable.”

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