Off-shore betting CEO pleads guilty

Apr 7, 2009 5:06 PM
The Insider by Ray Poirier |

The head of an online gambling enterprise – BetOnSports – has agreed to plead guilty to a federal racketeering conspiracy charge and to testify against others involved with the Costa Rica-based company.

Federal prosecutors have arranged a plea agreement for David Carruthers, 51 of Great Britain, in which he admits that the Internet gambling company he operated falsely portrayed Web-based gambling as legal and caused customers to lose millions of dollars they’ll likely never get back.

Carruthers also agreed to cooperate in the case being brought in September against company founder Gary Kaplan and six other associates.

In return for the plea agreement, Carruthers is expected to be sentenced to no more than 33 months in prison.

Noting that Internet gambling is illegal in the U.S., John Gillies of the FBI office in St. Louis, Missouri, remarked, "While BetOnSports operated offshore their illegal activities were not outside the long arm of the law."

The FBI said that when the company ceased operations in 2006, customers lost more than $16 million.