Online gambling stocks crash

[griswold]

The head of BetOnSports was arrested yesterday while making a connection on his flight back to Costa Rica. The plane stopped in the U.S. and the feds were ready for him.

Most of the owners of the online gaming stocks are unable to come to the US EVER because of the likelihood of arrest (the government claims online gaming is illegal but won't charge gamblers; just the operators).

Following the incident, most of the online gambling stocks melted down today. BOS dropped nearly 25 percent and the firm that owns Party Poker got crashed as well.

If you have an account with BOS, be careful right now and consider withdrawing money if you have gotten way ahead of them.

[cd329]

heres why, the guy was indicted and our government once again used the US attorney in missouri to get these indictments. The guy in charge their is a complete religious nutcase and he is constantly using his power to shove his beliefs down our throats. Every single time their is some kind of case with porn, gambling, peoples rights etc etc our government uses the good ole boy from missouri to do it.
welcome to the taliban in the good old U.S.A.

Justice Department Cracks Down
On Overseas Online Gambling Site

A WALL STREET JOURNAL ONLINE NEWS ROUNDUP
July 17, 2006 6:39 p.m.

The Justice Department charged BetOnSports Plc and some of its top officials with racketeering, conspiracy and fraud, as the U.S. government fired a salvo in its campaign to crack down on overseas Internet gambling sites.

The government said 11 people and four companies were indicted by a federal grand jury in the Eastern District of Missouri. Among the defendants are Gary Kaplan, the founder of BetOnSports, and David Carruthers, the U.K. company's chief executive.

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Should Online Gambling Be Banned: David Carruthers debates the issue with U.S. Rep. Jim Leach (4/4/06)Mr. Carruthers was detained Sunday by federal authorities while changing flights in Dallas en route from the U.K. to Costa Rica, where the company has much of its operations. Mr. Kaplan resides in Costa Rica and the Justice Department said it has issued a warrant for his arrest.

"Illegal commercial gambling across state and international borders is a crime," said U.S. Attorney Catherine Hanaway of the Eastern District of Missouri in a press release. "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."

BetOnSports, which is publicly-traded on the London Stock Exchange, owns a number of Internet sportsbooks and casinos. The company operates in the U.K., Costa Rica and other locales where online betting is legal, but much of its revenue comes from U.S. bettors.

Along with the indictment, the government filed a civil complaint seeking an order requiring BetOnSports to stop taking sports bets from the U.S., and to return money held in wagering accounts to account holders in the U.S. A federal judge in St. Louis issued a temporary restraining order Monday to prevent BetOnSports from accepting bets from the U.S.

According to the indictment, BetOnSports misleadingly advertised itself as the "World's Largest Legal and Licensed Sportsbook." The indictment also alleges that Mr. Kaplan failed to pay federal wagering excise taxes on more than $3.3 billion in wagers taken from the U.S. and seeks forfeiture of $4.5 billion from Mr. Kaplan and his co-defendants, as well as various properties.

The racketeering conspiracy alleges that the defendants agreed to conduct an enterprise through a pattern of racketeering acts, including repeated mail fraud, wire fraud, operation of an illegal gambling business and money laundering.

The three other charged companies, all Florida-based, were Direct Mail Expertise, Inc., DME Global Marketing and Fulfillment Inc. and Mobile Promotions Inc. Several of their owners were in custody, the Justice Department said.

Earlier Monday, BetOnSports disclosed Mr. Carruthers had been detained by U.S. authorities. The news rattled investors, who dumped online gaming stocks. Shares of BetOnSports fell 17% Monday, PartyGaming Plc slipped 4.4% while SportingBet Plc dropped 13%. All trade on the London Stock Exchange.

[vinnyvegas]

Unbelievable...

[bover1]

wow thats not right.....poor bastard...

[SNOWMAN]

http://money.cnn.com/2006/07/17/tech...ex.htm?cnn=yes