The ongoing saga of a group of former online casino operators with Gold Medal Sports continued this week with two new indictments and the sentencing of two of the previously indicted defendants.
David Howard, 49, of Las Vegas and Randy Moreau, 35, of Miami pleaded guilty on Monday in U.S. District Court in Madison, Wis., to violating the Federal Wire Act, the U.S. attorney's office said.
The sentencing for Gold Medal Sports' two primary owners, Duane Pede, 52, of Amherst Junction, Wis., and Jeff D'Ambrosia, 42, of Henderson, Nev., pleaded guilty to gambling and tax charges in December and were sentenced in their case on Tuesday. As part of their sentencing D'Ambrosia and Pede both face up to five years in federal prison.
As part of their plea agreement in December the corporation of Gold Medal Sports was ordered to forfeit $3,528,617.47. The court was advised on Tuesday that the money had been turned over to the federal government.
Gold Medal Sports is still in operation in the Caribbean Island of Curacao in the Netherlands Antilles. As part of their plea agreements, Moreau and Howard each have agreed to pay $20,000 fines. The charges were related to their ownership and participation in the site, which handled some $400 million in bets from August 1996 to April 2000.
This was the first Internet gambling case in federal court in Wisconsin to end in convictions. It came to light as part of a three-year undercover and financial investigation into illegal offshore sports bookmaking and sports handicapping telemarketing services.
In addition to the corporation forfeiting more than $3.5 million, Gold Medal Sports was ordered to discontinue participation in offshore sports betting and Internet casino gambling. The company was also ordered to discontinue the use of a direct mail program that uses false and fraudulent advertising practices and phone sale tactics to obtain clients.
As part of the plea agreement, Gold Medal Sports was placed on probation for one year under the condition that a disclaimer be published in USA Today. The disclaimer was to run for one day and the company had to provide a copy of the disclaimer to court officials. Upon completion of those conditions the term of probation would be determined. The court was advised that the disclaimer had been published, and the terms of probation were deemed ended.
In addition to their five-year prison terms, 36 month and 24 month sentences to be served consecutively, both men had a handful of additional penalties handed down to them by the court on Tuesday.
Duane Pede: After his time in prison he will be under supervised release for one year on both counts. He'll also pay an income tax payment of $410,859, a criminal assessment penalty of $200 and a fine of $100,000. His voluntary surrender date is March 29.
Jeff D'Ambrosia will undergo a one-year supervised release after his jail time. He will also pay an income tax payment of $1,018,706, a criminal assessment penalty of $200 and a fine of $100,000. His voluntary surrender date is March 29.
According to the U.S. District Attorney’s office in the western district of Wisconsin, Gold Medal Sports took bets both online and over the telephone from players in the United States. As part of the investigation, an undercover IRS Criminal Investigation Division (IRS-CID) agent placed a wager over the phone to Gold Medal Sports. The bet was for $1,000 on the Green Bay Packers to beat the Seattle Seahawks by more than five points on Monday Night Football on November 1, 1999. By accepting the bet Gold Medal was in violation of the Federal Wire Act of 1961, which makes it a felony to accept interstate sports wagers over phone lines.
U.S. District Attorney Grant Johnson said the investigation showed that Gold Medal Sports handled phone and Internet sports bets from U.S. customers in excess of $33 million in 1996, $167 million in 1997, $119 million in 1998, $78 million 1999,and $5.7 million in the first quarter of 2000.
As part of the agreement Pede and D'Ambrosia pleaded guilty to violating the Federal Wire Act and filing a false federal income tax return because they failed to let the IRS know that they had foreign bank accounts. The corporation, which is owned by Pede and D'Ambrosia, also pleaded guilty to racketeering and criminal asset forfeiture.