Sportsbook.com Execs Discuss BetonSports.com Blowup
Sportsbooks.com, one of the largest online
sports wagering sites for U.S. customers is still trying to discern what the arrest of the CEO of a rival Web site by the FBI earlier this week will mean for their profits.
"It's been a tumultuous week," said Alex Czajkowski, marketing director for SportingBet PLC, which operates Sportsbook.com.
Sportsbook.com, the company's flagship brand, generated over $2 billion in sports wagers last year and over $5 billion in casino wagering. A vast majority of its business are American customers. "A lot of people are nervous."
Last Sunday, David Carruthers, the chief executive of BetonSports.com, was arrested in Texas and charged with racketeering and fraud. Carruthers was detained at a Dallas airport while traveling from Scotland to his home in Costa Rica, where BetonSports.com is based. His company's founder and media director were also arrested.
On Monday, a 22-count indictment was unsealed that charges Carruthers and 10 others as well as four companies in connection with taking sports bets from U.S. residents.
Carruthers' online enterprise, which included poker and casino sites, was shut down as part of the FBI sting, a first in the online gambling industry. BetonSports has been ordered to return deposits from U.S. customers, who accounted for almost three-quarters of the $48.3 million in deposits taken in during its first quarter.
The news sent share prices of the U.K.-listed BetonSports and other similar Web sites plunging. Trading in BetonSports was suspended July 18, the day after the indictment was unsealed. It's shares have not resumed trading.
Several online gambling companies listed on the London Stock Exchange have seen their share prices decrease. Wednesday, PartyGaming PLC lost 7 British pounds to 87.25 pounds. SportingBet closed at 174.75 British pounds, down 5.50 pounds. In contrast, the shares of Interactive Gaming Holdings PLC, which says it does not accept wagering by Americans, closed at 5 British pounds, up 25 pence.
July 23, 2006
Posted By Larry Rutherford
Staff Editor, CasinoGamblingWeb.com
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