The online gambling company BetonSports today sacked its chief executive after his arrest in the US on fraud charges.
David Carruthers was arrested last week at Dallas-Fort Worth international airport, Texas, while on his way from the UK to Costa Rica, where BetonSports is based.
BetonSports today issued a statement distancing itself from its former boss: “On July 24, the contract under which David Carruthers acted as CEO of the company was terminated … This action was taken as a consequence of Mr Carruthers’s continued detention by US authorities.
“Clearly, while he remains in the custody of the US government he is unable to perform his duties. Further, the company has been unable to speak directly with Mr Carruthers.”
Mr Carruthers and 10 others, including the founder of BetonSports, Gary Kaplan, were named in a 22-count indictment this week by federal prosecutors. The US government accused BetonSports of fraudulently taking bets from US residents by phone and the internet, and failing to pay excise taxes.
The London-listed company has been forced to shut down 85% of its business since the indictment.
The arrest of Mr Carruthers and the move against BetonSports sent internet gambling stocks plummeting.
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.
If you are keeping score, mark one up for the government. On Tuesday, BetOnSports, the giant gambling house brought down by federal prosecutors, was sentenced to probation and a fine of $28.2 million. However, BetOnSports is in debt up to it’s eyeballs, owing many millions more than it has, so it is doubtful it will pay any of the fine according to lawyers on both sides. It is estimated that it still owes seven to eight million dollars to U.S. gamblers; and that amount may be quite understated.
For anyone who has harbored any doubts whatsoever about the health of Big Brother, trust me, he is alive and doing very well. Point in fact: On Monday, Gary Kaplan, founder of BetOnSports, was sentenced to 51 months in prison on charges of federal racketeering.
He had been arrested on 20 felony charges in March of 2007 in the Dominican Republic. Those charges were for allowing American residents to place bets at BetOnSports.