An offshore sports-betting operation targeted by U.S. prosecutors shut down its Web site Tuesday night, a day after a federal judge ordered the company to stop letting Americans place wagers.
BetOnSports PLC said it was temporarily stopping all transactions while it reviewed the situation.
Earlier on Tuesday, the site had appeared to be operating normally, offering bets on Major League baseball and season-opening college football games.
The company's founder, Gary Stephen Kaplan, the biggest target in the indictment, was somewhere in Costa Rica. He had nothing to say about the case, according to a spokesman.
Trading of the company's shares was suspended in London on Tuesday. They fell as much as 24 percent Monday following news that the company's chief executive, David Carruthers, had been arrested and closed down 17 percent at 122.50 pence ($2.24).
In the fiscal year ended Feb. 5, BetOnSports reported a 65 percent gain in operating profit on continuing operations to $20.1 million. The company said it handled $1.77 billion worth of bets for the year, up 25 percent.
On Monday, federal officials unsealed a 22-count indictment that charges 11 people and four companies with conspiracy, racketeering and wire fraud in taking sports bets from U.S. residents. Authorities said BetOnSports falsely claimed that Internet and phone wagering on sporting events was legal and licensed.
Five of the 11 individuals were arrested, including Carruthers, who remained in custody in Fort Worth pending a detention hearing on Friday. Carruthers was arrested Sunday at Dallas-Fort Worth International Airport as he waited for a connecting flight to Costa Rica.
The Justice Department is seeking the forfeiture of $4.5 billion, plus several cars, recreational vehicles and computers from the defendants. Prosecutors convinced a federal judge in St. Louis to order BetOnSports to stop accepting bets placed from within the United States.
BetOnSports hesitated for a full day before shutting down, however. A company spokesman, Kevin Smith, had said attorneys were deciding what to do next.
Americans accounted for virtually all of the company's business until recently, when it began aggressively courting bettors in Asia.
Even if BetOnSports shuts down permanently, there are plenty of sites to take its place. Costa Rica has become a haven for Caribbean online sports books and casinos in the past decade because of its light approach to regulation, experts said.
"There are probably at least 140 sports books operating down there," said Sue Schneider, president of a suburban St. Louis firm that tracks the industry.
Some online sports books might stop taking bets from U.S. residents, but only if the United States is a small part of their business, Schneider predicted.
The indictment is likely to have even less effect on online casinos — those that take bets on poker or other games, but not on sporting events.
In the past decade, federal officials have prosecuted many operators of online sports books with U.S. ownership or operations because federal law prohibits using phone wires to place those bets, said Anthony N. Cabot, a Las Vegas lawyer who has represented traditional and online casinos.
In a celebrated case from 2000, prosecutors won a conviction against Jay Cohen, a U.S. citizen who ran an operation in Antigua that took sports bets from Americans over the Internet. He was sentenced to 21 months in prison.
But the wire law doesn't cover other types of casino betting, a federal appeals court in New Orleans ruled. That has left some doubt about whether prosecutors can shut down poker and other casino games that target American players, Cabot said.
And unless the operators set foot in the United States — as Carruthers and Cohen did — it's difficult to extradite them, Cabot said.
with all the trouble in the world right now you would think that our government would other more pressing issues to deal with. I quess high energy costs, NorthKorea,Irag, and Iran , not to mention the mess in Israeland illegal immagratiion are not very imprtant. Prohibition should be a lesson that we cannot legilate peoples morals.... they will just use illegal bookmakers at home...tnwinner
Geez, I wonder how long this is going to last. I agree tnwinner, you'd think the government could focus their energies on something more important, like poverty or crime the war going on.
But the wire law doesn't cover other types of casino betting, a federal appeals court in New Orleans ruled. That has left some doubt about whether prosecutors can shut down poker and other casino games that target American players, Cabot said.
This may be the key to our problem with Pick 3 and Pick 4 betting. If the law doesn't cover it, we can't be affected by the Wire law the government is using to presecute the gentleman from Costa Rica. This is going to get very interesting.
oreangeman.its the financial way of getting money to and from the betting place.if the place you play is lottery and they deal with casino stuff in financial transactions they are still going to be shut down.you do have a point........
I just think that the goverment is getting ticked at the fact that they were making more money then them LMAO I dont know I dont like to bet on line like that for any reason ... I just been got to many times ya know what I mean! I know that people do and they get paid but I am just to leary of it .... I am not to sure about this one I will continue to read and learn :D
God help anyone who can be a target in an election year!
with all the trouble in the world right now you would think that our government would other more pressing issues to deal with. I quess high energy costs, NorthKorea,Irag, and Iran , not to mention the mess in Israeland illegal immagratiion are not very imprtant. Prohibition should be a lesson that we cannot legilate peoples morals.... they will just use illegal bookmakers at home...tnwinner
Geez, I wonder how long this is going to last. I agree tnwinner, you'd think the government could focus their energies on something more important, like poverty or crime the war going on.
Repeat, I love a politician like I love a thief and a liar. and I hate a thief and a liar. ..............Please don't get me wound up today
the whole thing is like a real bad joke.politicians are evil,corrupt,lying,backstabbing poseurs.at least most of them are.....
But the wire law doesn't cover other types of casino betting, a federal appeals court in New Orleans ruled. That has left some doubt about whether prosecutors can shut down poker and other casino games that target American players, Cabot said.
This may be the key to our problem with Pick 3 and Pick 4 betting. If the law doesn't cover it, we can't be affected by the Wire law the government is using to presecute the gentleman from Costa Rica. This is going to get very interesting.
Orangeman
oreangeman.its the financial way of getting money to and from the betting place.if the place you play is lottery and they deal with casino stuff in financial transactions they are still going to be shut down.you do have a point........
I just think that the goverment is getting ticked at the fact that they were making more money then them LMAO
I dont know I dont like to bet on line like that for any reason ... I just been got to many times ya know what I mean! I know that people do and they get paid but I am just to leary of it .... I am not to sure about this one I will continue to read and learn :D