Handa-Lopez Indictment

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA

Criminal No.
VIOLATIONS: 18 U.S.C. § 371 --
Conspiracy to Gamble Domestically and Internationally 18 U.S.C. §§ 1955 and 2- Conducting an Illegal Gambling Business and Aiding and Abetting

UNITED STATES OF AMERICA,
Plaintiff;

v.

DAVID R. BROWN, and
RAYMOND L. CLARK,
HANDA-LOPEZ, INC.,
Defendants.

SAN J0SE VENUE

INDICTMENT

The Orange Jury charges:

Background

At all times relevant to this Indictment:

HANDA-LOPEZ, INC., World Wide Multimedia, Inc, and Scylinx, Corporation, A.V.V. (hereinafter "HANDA-LOPEZ"), were associated businesses with offices located at 457 E. Evelyn Avenue, Suite E, Sunnyvale, California. HANDA-LOPEZ was in the business of operating interstate and international lnternet gambling web sites and sold gambling software from its office in Sunnydale, California. At differing times, HANDA-LOPEZ employed approximately 10 persons.

2. DAVID BROWN was a partner and corporate officer of HANDA-LOPEZ. BROWN controlled HANDA-LOPEZ, Scylinx, Corporation, A.V.V. and Big Boy Toys, Inc. He became the chief technologist of HANDA-LOPEZ once RAYMOND CLARK joined the company in about March or April 1998.

3. RAYMOND CLARK became the president of HANDA-LOPEZ shortly after joining the company. CLARK also controlled World Wide Multimedia, Inc. and Pison Market & Consulting, Ltd. CLARK received compensation for his activities in HANDA-LOPEZ through payments to Pison Marketing & Consulting, Ltd.

4. HANDA-LOPEZ and its pricipals represented to the public that they hosted Internet gambling web sites in offshore locations. In fact, HANDA-LOPEZ hosted the sites from within the United States as its server was physically located at its office in Sunnyvale, California.

5. HANDA-LOPEZ hosted numerous web sites, which permitted interactive "Las Vegas style" gambling. Upon logging onto a HANDA-LOPEZ web site and paying a fee, a player was directed to the "Funscape.com," a portal which hyperlinked to other sites: (1) Cowboy Stud Poker (http://www.cowboystudpoker.com/); (2) Casino Royale (http://www.funscape.com/home.htm); (3) High Stakes (http://www.highstakes.com/); and (4) Casino Utopia (http://www.Casinoutopia.com). These sites permitted the playing of, among other games, blackjack, keno, roulette, lotto, poker, and slot machines.

6. In order to gamble, an Internet player first entered a credit card number to obtain "funbucks," which represented the item of value a gambler used to play a game. A "funbuck" equalled one-cent. The minimum playing amount was $19.95 which equated to 1,995 "funbucks." The playing amount was credited to a HANDA-LOPEZ merchant credit card account. If, at the end of a session, winnings exceed the initial credit card debit amount, the player could request a check from HANDA-LOPEZ or maintain the balance and use it to play at a later time. If the player lost, HANDA-LOPEZ would retain that amount in its merchant credit card account.

7. From July 1996 through May 1999, the credit card service company that managed the HANDA-LOPEZ merchant credit card account processed in excess of $6.2 million dollars of credit card transactions for HANDA-LOPEZ.

8. DAVID BROWN used proceeds from the HANDA-LOPEZ Intemet gambling operation to purchase items for personal use. The items included: a 1998 Piper Seneca V Aircraft, a home in Gilroy, California, a 1998 Lincoln Navisator and a 1998 Ferrari.

COUNT ONE: 18 U.S.C. § 371)

9. The allegations contained in paragraphs 1 through 8 of this Indictment are hereby realleged and incorporated by reference.

10. On or about and between March 1998 and May 1999, both dates being approximate and inclusive, in the Northern District of California, County of Santa Clara, and elsewhere, the defendants

DAVID R. BROWN,
RAYMOND L. CLARK
HANDA-LOPEZ, INC.,

did knowingly and intentionally conspire to conduct, manage, finance, supervise, direct and own an illegal national and international Intemet gambling business which permitted the playing of slots, blackjack and roulette in violation of California State law, and which involved five or more persons, was in substantially continuous operation for a period of more than thirty days and had a gross revenue of $2,000 in any single day, all in violation of Title 18, United States Code, Section 1955.

11. In furtherance of the conspiracy and to effect the objects thereof, in the Northern District of California, County of Santa Clara, and elsewhere, the defendants did commit and cause to be committed the following:

Overt Acts

a. In or about March or April 1998, DAVID BROWN recruited RAYMOND CLARK to assist him in operating HANDA-LOPEZ.

b. On or about March or April 1998, RAYMOND CLARK announced to employees that he was now the owner of HANDA-LOPEZ and that the name of the business would change to World Wide Multimedia, Inc. The entity nonetheless continued to do business also as HANDA-LOPEZ.

c. On or about April 15, 1998, HANDA-LOPEZ issued check number 2607 for $25.11, to a person in Hobbs, New Mexico for "Contest Winning."

d. On or about May 1, 1998, upon RAYMOND CLARK's instructions, HANDA-LOPEZ issued check number 23141 in the amount of $4,475,00, which was made payable to Pison Marketing & Consulting.

e. On or about September 15, 1998, upon RAYMOND CLARK's instructions, HANDA-LOPEZ issued check number 23327 in the amount of $5000.00, which was made payable to Pison Marketing & Consulting.

f. On or about October 27, 1998, RAYMOND CLARK applied to a credit card service company for a merchant account, indicating on the application that he was the president of HANDA-LOPEZ.

g. On or about November 18, 1998, HANDA-LOPEZ issued check number 3369 for $200.00, to a person in Merritt Island, Florida for "E-cash Reimbursement."

h. On or about February 26, 1999, upon RAYMOND CLARK's instructions, HANDA-LOPEZ, Inc. issued check number 23604 in the amount of $3050.00, which was made payable to Pison Marketing & Consulting.

i On or about March or April 1999, DAVID BROWN requested an increase in the Company's merchant credit card account limit to one million dollars per month.

j. On or about April 8, 1999, DAVID BROWN met with a credit card company representative and an undercover law enforcement agent.

All in violation of Title 18, United States Code, Section 371.

COUNT TWO (18 U.$.C, §§ 1955 and 2)

12. The allegations contained in paragraphs 1 through 8 of this Indictment are hereby realleged and incorporated by reference.

13. In or about and between March 1998 and May 1999, both dates being approximate and inclusive, in the Northern District of California, County of Santa Clara, and elsewhere, the defendants

DAVID R. BROWN,
RAYMOND L. CLARK, and
HANDA-LOPEZ, INC.

did knowingly and intentionally conduct, finance, manage, supervise, direct, and own all or part of an illegal gambling business, which permitted the playing of slots, blackjack and roulette in violation of California State law, and which involved five or more persons, was in substantially continuous operation for a period of more than thirty days and had a gross revenue of $2,000 in any single day.

All in violation of Title 18, United States Code, Sections 1955 and 2.

ROBERT S. MUELLER, III
United States Attorney

ELIZABETH DE LA VEGA
Chief, San Jose Branch

(Approved as to form:)
AUSA Carlos Singh