$28.2 Million Fine For BetOnSports

02 December 2009

If you are keeping score, mark one up for the government. On Tuesday, BetOnSports, the giant gambling house brought down by federal prosecutors, was sentenced to probation and a fine of $28.2 million.

However, BetOnSports is in debt up to it’s eyeballs, owing many millions more than it has, so it is doubtful it will pay any of the fine according to lawyers on both sides. It is estimated that it still owes seven to eight million dollars to U.S. gamblers; and that amount may be quite understated. It is believed that many gamblers did not make claims, fearful of repercussions from the federal government.

It is unlikely that any gamblers still owed money will see anything more than pennies on the dollar.

The company went out of business in 2006 after Gary Kaplan, its founder and several more executives were indicted in St. Louis, MO on federal charges accusing them of running an illegal gambling operation. Former CEO David Caruthers pled guilty in April 2009, but has yet to be sentenced.

In its prime, it handled more than $1 billion in bets a year through its many websites. It quit taking bets from U.S. players later that year, and in May 2007, pleaded guilty to racketeering conspiracy.

Gary Kaplan pled guilty to conspiracy, racketeering conspiracy and violating the Wire Wager Act and forfeited $43.65 million, and in November, was sentenced to 51 months in prison. His brother and sister pleaded guilty in June to felony conspiracy charges and turned over more than $6 million they had in Swiss bank accounts.