Twelve men face federal charges in the middle district of Florida for running at least two illegal sports gambling business, Player's Edge, Inc. and National Sports Consultants. The U.S. Department of Justice has already arrested most of the men and is in the process of pursuing the rest of them. The prosecutor's affidavit alleges that the men who ran the operation conducted an illegal gambling business in violation of state law (Title 18, U.S. Code, Sections 1955(a)) and violated the Wire Act (Title 18, U.S. Code, Section 1084), both of which would constitute a conspiracy to gamble domestically and internationally (Title 18, United State Code, Section 371).
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"When you're paying guys to throw the game, when you're paying officials to make bad calls, it costs a lot of money."
- Gino DeCarlo
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The 12 individuals engaged in a tout service that offered customers extensive inside intelligence and consultancy on the outcomes of future sporting events in exchange for money. Although that aspect of the business is not illegal, the prosecutor alleges that the individuals encouraged customers to place bets with specific offshore sports books and then later received a commission from those sports books on its referrals.
The FBI, Immigration & Customs Enforcement (ICE), Internal Revenue Service-Criminal Investigation (IRS-CI), Lee County's Sheriff's Office and the United States Secret Service are participating in the investigation, which has also received assistance from a cooperating source that worked with the individuals' company.
The investigators claim that Player's Edge and International Sports Consultants would encourage customers set up accounts and place bets with particular offshore books. An undercover agent for the Secret Service alleges that the company recommended that he place his bets with Internet-based Fair Deal Sports because they provide timely payouts to winners. The investigators also claim to have bank records showing deposits to the defendants' accounts from various banking entities in the Caribbean and Central American regions.
John J. Rodney incorporated Players Edge in 1993 and sold the business in May 2003. The new ownership changed the name of the company to International Sports Consultants and continued business as usual. Despite selling out of the business, Rodney faces the same charges as the other eleven defendants.
According to the affidavit, the businesses produced a radio show that aired on several sports stations across the country, and the defendants reportedly used several aliases when talking on the radio program and/or dealing with customers from different regions.
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". . . There is the possibility of targeting the radio stations that placed their ads, and even potentially some of the attorneys who were involved in drafting the mechanisms to manipulate the system."
- Ronald Blumberg
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The affidavit also casts some doubt to the legitimacy of the inside information the companies claimed to possess. The companies allegedly gave clients information that was seemingly only mildly important, and also informed them that some of the games were fixed and therefore smart gambles. Gino DeCarlo, one of a few aliases of one defendant, allegedly told a client in a recorded conversation, "When you're paying guys to throw the game, when you're paying officials to make bad calls, it costs a lot of money. There's a lot of money at stake here. Millions and millions of dollars. So, that's why the cost is so great."
Civil Action
The Player's Edge/National Sports Consultants handicappers have found themselves on the receiving end of civil complaints as well. A California man, Timothy Bronkhurst, settled a federal lawsuit with some of the defendants four months ago. Bronkhurst, who paid more than $2 million over the course of several months, claimed the consultation he received was fraudulent and led to betting losses.
David Harter of Kansas City is also irate after doing business with the defendants. He claims to have lost $15,000 because of bad information. Harter created a Web site, www.nationalsportsconsutantsvictim.com to organize enough disgruntled clients to file a class action suit.
Ronald Blumberg, the lawyer who would take Harter's class action case, said his office is waiting until enough clients come forward to make the case profitable enough on a contingency fee. So far, he said, 20 people claiming to have suffered losses totaling $400,000 are ready to add their name to the class. He estimated that by next week enough people should be gathered to file a suit.
The criminal charges in Florida could have a dual effect on the civil case(s). On the one hand, media attention could draw more people to join the class. But on the other hand, as Blumberg pointed out, the defendants are now less likely to have money to repay the victims. That could be countered by the class casting a wider net.
"We're going to be targeting other sources," Blumberg said. "For instance, there is the possibility of targeting the radio stations that placed their ads, and even potentially some of the attorneys who were involved in drafting the mechanisms to manipulate the system."
This would mark the first time civil actions are taken against entities that aid or promote or I-gaming businesses but have nothing do to with the operation of such businesses. A number of such entities for the last six months have been faced with the possibility of criminal charges related to aiding and abetting.