As expected, indicted gambling company BetonSports (BoS) pled guilty today to federal racketeering charges, according to U.S. Attorney Catherine Hanaway.
The company could now face $500,000 or more in fines.
Under the plea agreement, BoS will supply witnesses and evidence in the pending cases against the co-defendants, in exchange for immunity against future related charges being brought against BoS directors, past or present, not already charged.
Furthermore, by pleading guilty to the racketeering conspiracy charge, BoS admits to conducting an enterprise through a pattern of racketeering acts, including repeated mail and wire fraud, operating an illegal gambling business, money laundering, and multiple state-gambling felony charges, Hanaway said in a prepared statement.
BoS was indicted in July 2006 by a federal grand jury in St. Louis, Mo., on charges of racketeering, conspiracy and fraud. Besides the company's indictment, 11 individuals--including then-CEO David Carruthers and BoS founder Gary Kaplan--and 3 related companies were also indicted on the same charges.
After being arrested in the Dominican Republic in March and extradited to St. Louis, Kaplan, 48, pled not guilty earlier this month to 20 felony charges including violations of the Wire Act, Racketeer Influenced and Corrupt Organizations (RICO) Act, and tax evasion.
The company faces a fine of up to $500,000, possibly more, based on the financial gain or loss caused by the enterprise. The maximum fine can be doubled.
Furthermore, it faces possible forfeitures, and is subject to a permanent injunction that requires it to repay money received from U.S. gamblers held by the company as of June 1, 2006.
Following a shareholders meeting on May 16, the company is in the process of paying off customers, creditors and employees, with the help of the Financial Services Regulatory Committee in Antigua.
BoS settled in November a related civil suit by agreeing to permanently shut down U.S.-facing operations, including phone lines and Web sites, refund the money owed to customers and cooperate with government investigators.
Carruthers, who was arrested in Dallas while changing planes on his way to Costa Rica, remains on house arrest in St. Louis and awaits trial. Kaplan, who was a fugitive from justice for nearly seven months, was arrested in March in the Dominican Republic.
He was arraigned and pled not guilty on May 14.
All defendants are awaiting trial.
Click here to view a copy of the BoS plea agreement.