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Betonsports, Prosecutors Strike Tentative Deal, Lawyers Say

Betonsports Plc., the British Internet bookmaker indicted in the U.S. for
illegal gambling, has reached a preliminary deal with prosecutors to end a
civil suit seeking to ban the company from doing business in the U.S. U.S.
District Judge Carol Jackson in St. Louis 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 today. A temporary order barring
Betonsports from doing business in the U.S. has been in place since July 17.
Neither side disclosed terms of the preliminary agreement in court. On July
17, prosecutors also 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. He pleaded not guilty and is currently under house arrest in
St. Louis. Kaplan is still at large. Six other defendants have pleaded
innocent. President George W. Bush on Friday signed legislation making it
illegal for credit card companies to collect payments for transactions with
online gambling sites. Gambling on the Internet has become a $12
billion-a-year business that’s growing rapidly offshore.
Betonsports attorney Jeffrey Demerath told Jackson today 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. He doesn’t represent the individual
defendants.