BetOnSports Founder Pleads Guilty in Racketeering Case

The founder of the now-defunct Internet gambling firm BetOnSports pleaded guilty Friday to conspiracy and racketeering bills.

The founder, Gary S. Kaplan, admitted to numerous charges of conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act. He agreed to serve 41 to 51 months in prison and forfeit $43.65 mlln., in line with a Justice Department statement.

He entered the plea in U.S. District Court in St. Louis.

Mr. Kaplan and his firm were accused of violating federal laws banning the interstate transmission of wagers by wire. He was arrested in the Dominican Republic in March 2007, and has been in custody since then. He was indicted on the bills in 2006.

Now bankrupt, BetOnSports took in $1.25 billion in 2004, with 98 percent of that income coming from bets made by means of its Web site by purchasers in the U.S.. The firm, which is based in London, suspended trading of its shares on the London Stock Exchange on July 18, 2006, someday after the indictment was unsealed.

Mr. Kaplan entered a binding plea arrangement, which the judge must either accept or reject unaltered at Mr. Kaplan’s sentencing on Oct. 27.

“This brings to an end a markedly controversial enforcement action,” a Houston protection lawyer, Dan Cogdell, who accompanied Mr. Kaplan in court, mentioned in a phone interview. “Kaplan long believed that what he did was lawful; it was only in the last many years he recognized it wasn’t lawful. He’s produced every effort to make amends.”

Mr. Cogdell mentioned the government agreed to drop additional bills if the judge granted the plea deal. He mentioned Mr. Kaplan should receive credit at sentencing for the two years he has earlier spent in prison.

Since Mr. Kaplan’s indictment, BetOnSports filed for liquidation and, in May 2007, entered a guilty plea to racketeering bills.

The indictment named the company; Mr. Kaplan; the chief executive, David Carruthers; and 9 other people. Mr. Carruthers admitted to one count of racketeering conspiracy in April.

All of the other individual defendants, this includes the founder’s siblings, Neil Scott Kaplan and Lori Beth Kaplan Multz, pleaded guilty to criminal bills in the case, leaving their brother as the lone defendant facing trial.
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