BetonSports agreed to testify against Kaplan and Carruthers

BetonSports pleaded guilty to federal racketeering charges. The company, which is very popular in the online gambling world, stopped taking wagers in July 2006 after its former CEO David Carruthers was arrested.

According to Joseph Kelly, professor of Business Law at Buffalo State, the government is pleased with the arrest, and they don't intend to arrest any other directors of the corporation.

The company agreed to testify against Carruthers and Gary Kaplan, the company founder, and because of this U.S. Attorney Catherine Hanaway won’t bring any charges against the other directors of the company.

Hanaway said that this plea should put an end to the illegalities done by BetonSports, and also with this plea, the company has submitted itself to the U.S. justice system. By agreeing with this plea, the company admits that it has conducted illegal activities.

Now most likely the company will be fined and it will have to pay the money back to its customers, who have had their money frozen. One day after this announcement, Carruthers submitted a motion to dismiss his case related to a World Trade Organization ruling, which stated that the General Agreement on Trade in Services were violated by the U.S.A, because it allowed American companies to accept Internet wagers (horse races and lotteries).

A decision could be taken in months. Kelly said that the federal magistrate’s decision is surprising, since he never expected her to ask for these motions on her own. The company was created in Antigua and Costa Rica, after Kaplan had previously ran illegal sports betting operations in New York and Miami.

Carruthers made the company a trusted brand and he strongly opposed the Internet gambling regulation in the United States. Kelly said that he thought Kaplan was the mastermind behind all these activities, but now he believes that Carruthers was guilty too.