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Baltimore feds target Internet gambling
Set up phony company to catch illegal betting businesses
Two Internet gambling businesses and their international owners were indicted by a Maryland federal grand jury as part of a lengthy, undercover investigation, details of which were released Monday after 11 associated bank accounts were seized in five countries and 10 Web domain names were shut down.
The indictments, returned late last month and unsealed Monday, are the result of a two-year sting operation by the Homeland Security Investigations in Baltimore, a division of U.S. Customs and Immigration enforcement. The agency set up a phony payment processing business in Atlantic City and spent two years infiltrating the world of illegal online betting.
Agents ultimately handled more than $33 million in transactions and uncovered a thriving criminal community in Maryland and beyond: "There are numerous individuals in Maryland who have authorized payments to these [foreign] businesses," claims one agent's sworn affidavit, filed with court records.
Charged in the indictments are ThrillX Systems Ltd. and owners Darren Wright and David Parchomchuk, both of British Columbia, Canada; and K23 Financial Services (known as BMX Entertainment), run by defendant Ann Marie Puig, of San Jose, Costa Rica. They're all charged with running an illegal gambling business and money laundering through various Web sites seized Monday, including Truepoker.com and Funtimebingo.com.
Banners saying the sites had been shut down were expected to replace the websites Monday, though they had not yet been posted by mid-afternoon.
The defendants did not return messages left with their respective companies Monday.
"It is illegal for internet gambling enterprises to do business in Maryland, regardless of where the website operator is located," U.S. Attorney Rod J. Rosenstein said in a statement Monday. "We cannot allow foreign website operators to flout the law simply because their headquarters are based outside the country."
Similar indictments were unsealed in Manhattan federal court in mid-April, charging 11 defendants, including the founders of the three largest Internet gambling sites operating in America. Earlier this month, the U.S. Attorney for the Southern District of New York announced that one of the defendants, Absolute Poker, had agreed to shut down U.S. operations and attempt to return player deposits.
The money made from illegal Internet gambling often funds organized crime, William Winter, the special agent in charge of the Homeland Security Investigations in Baltimore said in a statement.
"Together, with our law enforcement partners, we will disrupt and dismantle organizations that commit these crimes, regardless of their location," Winter said.
The indictments and supporting HSI agent affidavit claim that the defendants run illegal gambling businesses based outside the U.S. that mostly deal with American customers, relying on third-party "payment processors" to move money between their businesses and the gamblers.
Investigators launched such a processor — called "Linwood Payment Solutions Inc." — to unravel the Internet gambling web, giving it a website and a staff of Homeland Security Investigations agents tasked with gaining "person-to-person contact with top managers of gambling organizations," prosecutors said.
A call to the phony business wasn't answered Monday, though a recorded voice suggested we leave a name and call back number. The undercover company claims to have "over 10 years of team industry experience" on its web page — paymentprocessingsolutions.com — and to specialize in "global transaction processing" among other things.
Agents claim that Linwood processed gambling transactions for the defendants using banks in Portugal, Malta, Panama, The Netherlands and the United States — more than 300,000 transactions in a two-year period worth more than $33 million. The accounts were seized along with the Web pages.
If convicted of running an illegal gambling business, the defendants face a maximum of five years in prison. Money laundering carries a maximum sentence of 20 years.
The following internet domain names were seized pursuant to federal court order:
Bookmaker.com
2Betsdi.com
Truepoker.com
Betmaker.com
Betgrandesports.com
Doylesroom.com
Betehorse.com
Beted.com
Baltimore feds target internet gambling sites - baltimoresun.com
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