BetOnSports to shut down US operations

BetOnSports to shut down US operations

	Published : Fri, 11 Aug 2006 12:35 By : James Rowe Print this Story

LONDON - British online gaming website BetOnSports will be closing down its business in US after it received an order from court that it was breaking the federal law of the country. This announcement comes soon after it had to sack its chief executive after he was arrested on racketeering charges.

The company is under intense pressure as it faces as many as 22 charges in the US court of law relating to illegal gaming activities as it had catered to US customers online. Online gambling on sporting events is banned in the US.

Former chief executive of the website, David Carruthers was arrested last month in Texas and a search is on for the company's founder Gary Kaplan. BetOnSports however insists that all ties have been severed with Kaplan and it is not responsible for what its former directors do.

This decision comes as a huge blow to the gaming site as around 85 percent revenue generated by the company comes from the US operations, headquartered at Antigua and Costa Rica. BetOnSports released a statement saying, "By complying with the U.S. Department of Justice and not taking bets in the U.S., BetOnSports is hoping the Department will ease up on the payment processes to allow BetOnSports to gain more sales from outside the U.S. and help it pay creditors. The directors are taking steps to ensure that the company will not knowingly accept any wagering transactions from U.S. based customers".

The US authorities insist that the company owes money to it as it has not paid taxes for nearly £1.7 billion in bets made by US citizens. In a statement released, the US government said, "The company conspired to defraud and has defrauded tens of thousands of residents of the US nationwide by conducting a fraudulent scheme in violation of federal mail and wire fraud statutes".