News released earlier today reported BetonSports CEO David Carruthers was detained by US federal authorities while he was in the US changing flights on his trip from the UK to Costa Rica.
No statement has been released regarding the reason for the detention; in fact very little at all is known about the reasons behind the actions by the U.S. The company BetonSports has not made an official statement, just saying an announcement will be made when appropriate.
After news broke on Carruthers, trading on BetonSports and other companies like PartyGaming PLC traded down.
Canaccord advised its clients the move is more than likely politically motivated although the broker followed this up by saying it’s too early to say if this is a new strategy on the part of the US to intimidate or if the US Department of Justice was ‘flexing its muscle and trying to influence legislation’. The legislation referenced is the Goodlatte/Leach bill prohibiting gambling over the internet (excluding horseracing or government run programs such as lotteries) which recently passed the US House and is slated for presentation in the US Senate.
Mr. Carruthers has recently been seen on CBS EVENING NEWS and written articles like the one in the BALTIMORE SUN on regulating and taxing online gambling. It’s possible his stand on internet gambling has made him a target of the Department of Justice.
The Amaya Gaming Group's rise to prominence in the online gambling industry has been a pretty big story over the past few years. Starting out as a relatively small company that seemed to specialize in buying up undervalued online gambling software companies like CryptoLogic and turning them around, they really broke out in 2014 when they purchased the Rational Group in mid-2014 for a huge sum of around $5 billion.
Norman Steinberg, co-owner of Millenium Group, a subsidiary of BetOnSports, which was shut down by federal prosecutors in 2006, came to the U.S. this week and was sentenced to 3 years’ probation which is to be served from his home on Costa Rica, a $10,000 fine, no restitution and is unrestricted to travel anywhere in the world.
This is a far cry from what the other people who were related with BetonSports got from the U.S. prosecution.
David Carruthers’ ordeal is finally over. Or soon will be in 33 months. That is the length of the sentence handed down to him by Judge Carol E. Jackson of the Missouri Eastern district Court following a plea agreement between David Carruthes and federal prosecutors yesterday. He has been confined to a hotel in St. Louis, MO. Since his arrest in 2006, he has been under electronic surveillance while waiting for trial.