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Internet Gambling CEO Arrested by FBI
tightpoker writes to mention the news that several key individuals associated with online gambling site BetonSports have been indicted in a Missouri courtroom. Founder Stephen Kaplan, CEO David Carruthers, 9 other people and four corporations have been charged with crimes ranging from racketeering to fraud. The Sunday Time reports on the story as well, addressing fears this may be a prelude to a crackdown on all online gambling by U.S. law enforcement. From the article: "Nigel Parson, leisure analyst at Williams de Broë, said the move would 'throw online gambling stocks into a spin,' adding: 'David Carruthers is a prominent advocate of online gambling. The fear that this is an escalation of the anti-lobby will trouble markets.' Greg Harris, an analyst at Cannacord, said: 'It is too early to say if this is part of a broader strategy on prevention of internet gambling in the U.S. or if it is the Department of Justice flexing their muscles and trying to influence legislation.'"
The government gets a healthy cut from the earnings in Las Vegas and Atlantic City. Politicians get hefty contributions due to the earnings from Native American casinos. And lotteries like Powerball are the government's own game.
So it's no wonder that online gambling sites lose, and will continue to lose in court. You've got to pony up to the bosses if you want to work in this town. (Preferably, both Democrats and Republicans.)
That, and those poker chips block the Internet's tubes....
Also, with midterm elections looming, it doesn't hurt for the Republicans to crack down on some 'immoral' activity to appease their 'values' voters.
Right now, there is no such thing as legal online gambling in the US. Because of that, all online gambling businesses are breaking the law.
wait one minute there.... the absence of a law legalizing online gambling does not, in fact, make the activity illegal. There's no law legalizing mowing your yard (oh God, at least I hope there's not!), but it is legal to do so. IMO, gambling is something should remain regulated at the state level regardless.
On the other hand, I'm not a lawyer. Maybe the Federal government has a law criminalizing online gambling. But it seems like these guys are (like most of the "gambling bad guys" from yesteryear) getting hit with TAX law. That doesn't make online gambling illegal, the Feds have just make it impossible to run an online casino AND pay federal wager taxes on the income. Who's the real crook? Note they're dragging years of non-online gambling into this story as well, trying to make a case against online gambling by throwing traditional bookmaking in the mix.
For me, if they get these guys for not paying US wager taxes on gambling wages placed by US citizens, then any online retailer who only collects Sales Tax for the state their entity exists in should be charged with racketeering too.
The U.S just arrested a CEO of a foreign Corporation for doing internet business that was contrary to U.S law. Next time we complain about Google or Yahoo bending over backwards to adhere to Chinese law, we should take into account our own policies.