BetonSports: Civil Elements Near Settlement

Published: Tuesday, October 17, 2006 Online-Casinos.com

CIVIL ELEMENTS OF BETONSPORTS CASE NEAR SETTLEMENT

But no news on the criminal indictments facing former CEO and others


Associated Press reported this week that the civil elements of the litigation between the US Department of Justice and online betting group BetonSports could be close to a settlement after some intensive negotiations with the prosecution (see previous Online-Casinos.com/InfoPowa reports)

The UK Internet gambling group was the subject of a temporary restraining order (renewed several times) preventing it from doing business with US residents and requiring it to pay back US player deposits. The company complied with the first part of the order, blocking play by American gamblers.

U.S. District Judge Carol Jackson in St. Louis this week granted the parties one week to complete what Assistant U.S. Attorney Michael Fagan said was a 21-page accord resolving a civil suit filed against the company in July by the Justice Department.

"My impression is there are no substantive disagreements,'' Fagan told Jackson on Tuesday. Neither side disclosed terms of the preliminary agreement in court.

BetonSports attorney Jeffrey Demerath told Jackson that difficulty in assembling the company's board of directors for a review of the proposal was the primary obstacle to completing the accord.

"We received it Thursday afternoon,'' Demerath told the judge."We just haven't had the time to get everyone together.''

Outside the courtroom, Demerath declined to comment on the status of the criminal case against BetonSports in which he is not involved.

Whilst the civil case may be nearing a resolution, the 22 count criminal indictment facing ex-CEO David Carruthers, founder and shareholder Gary Kaplan and others would appear to remain a live issue.

On July 17 this year, prosecutors unsealed a 22-count indictment charging BetonSports founder Gary Kaplan, former Chief Executive Officer David Carruthers and nine others with racketeering and violating federal interstate gambling laws. In 2003, the company's Web site, Betonsports.com, had 100,000 active players who placed 33 million wagers worth more than $1.6 billion, the U.S. has said.

Carruthers, 48, was arrested in July as he changed planes at a Texas airport on his way to Costa Rica. He pleaded not guilty and is currently under house arrest in St. Louis on a million dollar bail bond. Kaplan is still at large. Six other defendants have pleaded innocent.