March 26 was D-Day for the next rash of criminal complaints against online
gaming operators. Another 7 individuals were targeted and IGN is offering
you the complaints against those folks as well as the full text of the US
Attorney's news release on the matter.
Approved:
JOSEPH V. DE MARCO
Assistant United States Attorney
Before:
HONORABLE HENRY B. PITMAN
United States Magistrate Judge
Southern District of New York
UNITED STATES OF AMERICA
-v-
TERRY PETERS, Defendant
SEALED COMPLAINT:
Violation of
18 U.S.C. 371
COUNTIES OF OFFENSE:
NEW YORK AND ELSEWHERE
SOUTHERN DISTRICT OF NEW YORK, ss.:
JOSEPH A. LA TORRE, being duly sworn, deposes and says that he is a
Special Agent with the Federal Bureau of investigation and charges as
follows:
COUNT ONE:
1. From in or about 1998, up to and including on or about March 17,
1998, in the Southern District of New York and elsewhere, TERRY PETERS,
the defendant, and others known and unknown, unlawfully, willfully, and
knowingly did combine, conspire, confederate, and agree together and
with each other to commit an offense against the United States, to wit,
to violate Title 18, United States Code, Section 1084.
2. It was a part and object of the conspiracy that TERRY PETERS, the
defendant, and others known and unknown, being engaged in the business
of betting and wagering, unlawfully, willfully and knowingly, would and
did use a wire communication facility for the transmission in interstate
and foreign commerce of bets and wagers and information assisting in the
placing of bets and wagers on sporting events and contests, and for the
transmission of a wire communication which entitled the recipient to
receive money and credit as a result of bets and wagers, and for
information assisting in the placing of bets and wagers, in violation of
Title 18, United States Code, Section 1084.
OVERT ACT:
3. In furtherance of said conspiracy, and to effect the object thereof,
a coconspirator not named herein committed the following overt act in
the Southern District of New York and elsewhere:
a. On or about March 12, 1998, an undercover FBI agent located in New
York, New York had a telephone conversation with a representative of
Grand Holiday Casino in Curacao, the Netherland Antilles, in which the
UC discussed opening a sports betting account.
(Title 18, United States Code, Section 371)
The bases for my knowledge and the foregoing charge are, in part, as
follows:
4. I have been an FBI agent f or 3 years. I am familiar with the facts
and circumstances set forth below from my participation in the
investigation and from my conversations with other law enforcement
agents and witnesses. Because this Complaint is being submitted f or a
limited purpose, I have not included details of every aspect of this
investigation. Where conversations or statements are related herein,
they are related in substance and in part only unless otherwise
indicated.
5. During the course of this investigation, I received information from
various sources that a business known as Grand Holiday Casino ("GHC")
was operating a sports betting business over the Internet. As a result
of this information, the FBI began an investigation to determine, among
other things, whether GHC was using the Internet or other forms of wire
communication facilities in interstate and foreign commerce to conduct a
sports betting business and, if so, who was responsible for that
conduct.
6. Based on knowledge I obtained by speaking with various FBI agents
involved in the investigation of crimes committed through the use of
computers, I know that the Internet is an immense worldwide computer
network used by millions of individuals daily. The Internet is
comprised of many smaller computer networks that are connected to each
other via telephone and other data lines. The World Wide Web ("WWW") is
a hypertext-based system that facilitates the ability to find and access
information on the Internet. Many businesses, including GHC, use the
WWW to advertise, promote, and provide information about their
services. Typically, communications over the Internet—including the
references in this Complaint to accessing WWW pages—take place over
ordinary telephone lines through the use of a modem. Those
communications travel over ordinary telephone lines between the points
of origin (such as a computer server that is used to store and transmit
WWW pages) and the points of reception (such as the Personal computer of
an individual who accesses a particular site on the WWW).
7. On or about March 12, 1998, using an undercover Internet account that
can be accessed at the FBI offices in New York, New York, another FBI
agent assigned to this case accessed the web site for GHC, at
http://www.ghconline.com. The GHC web site revealed, among other things,
the following:
a. GHC is a sports wagering service that accepts bets on various
sporting events.
b. GRC offers a toll-free telephone number, (800) 698-9088, to call for
information concerning sports betting, and to open a betting account.
8. On or about March 12, 1998, an undercover FBI agent posing as a
potential bettor (the "UC") called (800) 698-9088. A recorded message
confirmed that the UC had reached GHC, but stated that GHC's new
telephone number was (800) 730-5048. The UC then called that telephone
number, and spoke with an individual—later identified as "Jennifer"—who
confirmed that the UC had reached GHC. "Jennifer" stated that GHC
accepted bets for sporting events; that GRC requires a $500 minimum
deposit to open an account; and that $50 was the minimum wager amount.
"Jennifer" added that the UC could open an account with GHC using
Western Union to transfer the funds to GHC; and told the UC to direct
Western Union to wire the UC's funds to an individual named "Digyalgina
Dorregrosa" in Willemstad, Curacao. "Jennifer" further stated that
after the UC had obtained a control number from Western Uunion (I have
been informed that Western Union assigns a "control number" to every
transfer of funds so that a sender and recipient of the funds can
determine the funds’ whereabouts), it would be only approximately 5-10
minutes before the UC could begin placing bets with GHC. In addition,
"Jennifer" gave the UC a personal identification number ("PIN") which
would enable him to place bets.
9. Later that same day, the UC directed Western Union to send $500 to
"Digyalgina Dorregrosa" in Willemstad, Curacao. Thereafter, the UC
called GHC's toll-free number from the FBI office in New York City, and
provided the GHC representative who answered the phone—later identified
as "Jerry"—with the control number for the Western Union $500 transfer
and the PIN number with which he had been provided. In that same
conversation, the UC opened a betting account with GHC.
10. In a subsequent conversation later that same day, placed by the UC
to GHC's toll-free number from the FBI offices in ,New York, New York,
the UC bet on three National Collegiate Athletic Association ("NCAA")
basketball games scheduled to be played the following day.
Specifically, the UC bet $50 that St. John's University would not beat
Detroit-Mercy by more than 1.5 Points; $30 that Clemson would beat
Western Michigan by more than 8 points; and $50 that UCLA would beat
Miami-Florida by more than 6
points. In this conversation, Jerry provided the UC with GHC's
toll-free betting number, (888) 851-2541, and instructed the UC to call
this number in the future to place bets. The UC won one of the three
bets and lost the other two bets, and lost approximately $60 as a result
of these three wagers.
11. On or about March 13, 1998, the UC called GHC's toll-free betting
number, and, over the telephone, bet on one National Basketball
Association ("NBA") basketball game scheduled to be played later that
day. Specifically, the UC bet $50 that the Boston Celtics would not
beat the Detroit Pistons by more than 3 points. The UC won the bet, and
his GHC account was credited with approximately $50.
12. On or about March 16, 1998, the UC called GHC's toll-free betting
number, from the FBI offices in New York, New York, and spoke with an
unidentified woman ("C1"). Cl confirmed the UC's current account balance
at GHC, and transferred UC's call to an unidentified male ("C2"), who Cl
described as her manager. UC told C2 that he wanted to place a large
amount of money into his GHC account, but was concerned about doing this
because other Internet gambling houses had recently been shut down. UC
asked C2 to speak with the owner of GHC. In response to UC's concerns,
C2 told the UC that he was aware of the Shutdowns, and told UC to call
back the next day and ask for "Terry," who C2 described as GHC's
president.
13. On or about March 17, 1998, the UC called GHC's toll-free betting
number from the FBI offices in New York, New York, and asked the woman
who answered the telephone ("C3") if he could speak to the owner, which
the UC said he thought was "Terry." The UC also asked C3 for "Terry’s"
last name, which C3 refused to provide. Later that same day, the UC
called GHC's toll-free betting number from the FBI offices in New York,
New York, and asked the woman who answered the telephone ("C4") to speak
with the president, who he believed was "Terry." C4 told the UC to call
back in ten minutes. Shortly thereafter, the UC again called GHC’s
toll-free betting number from the FBI offices in New York, New York, and
asked the man who answered the telephone ("C5") to speak with "Terry."
After a brief wait, C5 connected the UC to another individual; the UC
asked this person if he was the "Terry" or "Jerry" who ran GHC; the
individual first stated that he was, but then denied that he was either
"Terry" or "Jerry" and Stated that his name was "Eamon Doran." "Doran"
told the UC that GHC could no longer accept bets from the UC,
purportedly because a law was recently passed in New York prohibiting
the placing of bets by individuals from New York State. In addition,
"Doran" told the UC that he recalled, based on the UC’s statements in a
previous conversation, that the UC had placed bets with other gambling
houses that had been shut down.
15. Later that same day, another FBI agent posing as a potential bettor
("UC2") called (800) 730-5048—referred to above in paragraph 8 as the
number provided by GHC's recorded message—from the FBI offices in New
York, New York. UC2 spoke to an unidentified male at GEC ("C6"), and
told C6 that he was calling from New Jersey. UC2 stated that he wanted
to talk to the owner of GHC because he was interested in placing bets of
approximately $50,000 per game on upcoming NCAA basketball games, and
asked C6 who the owner was. C6 stated that the owner was TERRY PETERS,
the defendant; that PETERS was visiting for two weeks and would be at
GEC the next day; and that 'UC2 should call back PETERS and talk about
placing bets.
WHEREFORE, deponent prays that a warrant issue for the arrest of TERRY
PETERS, and that he be imprisoned or bailed, as the case may be.
JOSEPH A. LA TORRE
Special Agent
Federal Bureau of Investigation
Sworn to before me this
20th day of March, 1998
HENRY B. PITMAN
UNITED STATES MAGISTRATE JUDGE
SOUTHERN DISTRICT OF NEW YORK