July 17, 2006
File Under "I Can't Believe This is Happening": The DOJ Arrests CEO of BetOnSports PLC While Changing Planes in Dallas
Posted by Christine Hurt

Growing up in Lubbock, the joke was that to get to heaven, you had to change planes in Dallas.  Apparently, Dallas is also the gateway to H-E-double toothpicks if you are the CEO of a successful online sports betting site that is headquartered in the UK and traded on the LSE.  On Sunday, the DOJ indicted three online betting sites and eleven individuals on charges of "racketeering, conspiracy and fraud."  Enforcing the Wire Act against online gambling sites has many problems (although most substantive problems are not present with sports betting sites, as with online casinos), the jurisdictional hurdle was jumped by arresting David Carruthers, CEO of BetOnSports, while he was changing planes in DFW on his way to Costa Rica. 

Now the puzzle is to figure out why now?  Does this new energy on the part of the DOJ spring from the House passing H.R. 4411 last week?

So, my question is this:  If millions of Americans are gambling online at offshore sites, why is this the problem of the offshore sites?  Casinos in Monte Carlo or the Bahamas attract Americans to take vacations there and visit the casinos, but we don't arrest the owners of foreign casinos should they take a vacation here in the U.S. or change planes in our airports.  Why is creating an online casino any different?  Why is the burden on the online gambling site to keep Americans out?  (Other than that burden being almost impossible to meet.)

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