Friday, August 04, 2006
Going After Web Gambling a Challenge
From AP
for the complete article:
http://biz.yahoo.com/ap/060804/online_gambling_prosecution.html?.v=2
Going After Web Gambling a Challenge
Friday August 4, 4:45 am ET
By Christopher Leonard, AP Business Writer
BetOnSports Case Illustrates Challenges of Going After Web Gambling
ST. LOUIS (AP) -- When federal prosecutor Marty Woelfle went before a judge this week to lay out her case against an online gambling firm, she faced a daunting legal challenge from the company. No one bothered to show up.
There would seem to be good reason for BetOnSports PLC to send attorneys to Missouri. The firm is facing a 22-count indictment on fraud and racketeering charges filed in St. Louis. The chief executive is in jail, and the company faces a restraining order barring it from operating in the United States.
But with headquarters in Costa Rica and other offices in Antigua, BetOnSports was advised it didn't have to respond to charges filed in a U.S. court, Woelfle told U.S. District Judge Carol Jackson.
Industry executives and legal experts are closely watching the prosecution in St. Louis as a key test case in the U.S. government's effort to crack down on Internet gambling, which collects roughly $6 billion domestically every year -- about half of the worldwide take.
"This may very well signal that the (U.S.) Justice Department is going to allow the U.S. attorneys to take this issue much more seriously than they have in the past," said William Eadington, director of the Institute for the Study of Gambling and Commercial Gaming at the University of Nevada, Reno.
If the BetOnSports prosecution is successful, it could change the industry landscape, he said.
"You basically have a very chilling effect on the entire U.S. segment of the market," Eadington said.
But the BetOnSports case also reflects the difficulties prosecutors face in going after a business that shuttles money from private computers to offshore bank accounts. If the prosecution stumbles, it could encourage online gambling firms based in countries like England, where the industry is legal.
"What has made it difficult is that these businesses have been structured to avoid prosecution," said U.S. Attorney Catherine Hanaway, who is leading the case against BetOnSports.
Taking the company to court is no simple matter. Executives live in countries like Costa Rica that make it difficult to extradite defendants to the United States. Even serving routine court papers is a headache involving international treaties.
Hanaway said she is pursuing the case against BetOnSports and other companies associated with online gambling because all those billions of dollars flowing out of United States escape excise taxes. Not only does that rob the U.S. Treasury, but it could foster other illegal activity.
for the complete article:
http://biz.yahoo.com/ap/060804/online_gambling_prosecution.html?.v=2
Going After Web Gambling a Challenge
Friday August 4, 4:45 am ET
By Christopher Leonard, AP Business Writer
BetOnSports Case Illustrates Challenges of Going After Web Gambling
ST. LOUIS (AP) -- When federal prosecutor Marty Woelfle went before a judge this week to lay out her case against an online gambling firm, she faced a daunting legal challenge from the company. No one bothered to show up.
There would seem to be good reason for BetOnSports PLC to send attorneys to Missouri. The firm is facing a 22-count indictment on fraud and racketeering charges filed in St. Louis. The chief executive is in jail, and the company faces a restraining order barring it from operating in the United States.
But with headquarters in Costa Rica and other offices in Antigua, BetOnSports was advised it didn't have to respond to charges filed in a U.S. court, Woelfle told U.S. District Judge Carol Jackson.
Industry executives and legal experts are closely watching the prosecution in St. Louis as a key test case in the U.S. government's effort to crack down on Internet gambling, which collects roughly $6 billion domestically every year -- about half of the worldwide take.
"This may very well signal that the (U.S.) Justice Department is going to allow the U.S. attorneys to take this issue much more seriously than they have in the past," said William Eadington, director of the Institute for the Study of Gambling and Commercial Gaming at the University of Nevada, Reno.
If the BetOnSports prosecution is successful, it could change the industry landscape, he said.
"You basically have a very chilling effect on the entire U.S. segment of the market," Eadington said.
But the BetOnSports case also reflects the difficulties prosecutors face in going after a business that shuttles money from private computers to offshore bank accounts. If the prosecution stumbles, it could encourage online gambling firms based in countries like England, where the industry is legal.
"What has made it difficult is that these businesses have been structured to avoid prosecution," said U.S. Attorney Catherine Hanaway, who is leading the case against BetOnSports.
Taking the company to court is no simple matter. Executives live in countries like Costa Rica that make it difficult to extradite defendants to the United States. Even serving routine court papers is a headache involving international treaties.
Hanaway said she is pursuing the case against BetOnSports and other companies associated with online gambling because all those billions of dollars flowing out of United States escape excise taxes. Not only does that rob the U.S. Treasury, but it could foster other illegal activity.
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