Risky business

Stephen Beard Jul 18, 2006

KAI RYSSDAL: The federal government’s getting serious about online gambling. Congress is trying to make it harder to place your bets over the Internet. And the Justice Department charged 11 people with racketeering and fraud yesterday for accepting sports bets from US residents. Prosecutors are trying to seize $4.5 billion from the accused. One is the British CEO of an online betting firm. From London, Marketplace’s Stephen Beard reports.

STEPHEN BEARD: David Carruthers, head of BETonSPORTS.com was arrested as he changed planes in Dallas. He was on his way to Costa Rica where his online gambling firm is based.

The company operates offshore because Internet betting is illegal in the US, but BETonSPORTS has directly marketed its services at American customers.

Analyst Tim Steer says Carruthers’ arrest has triggered a big sell-off in the shares of Internet betting companies listed in London.

TIM STEER: The vast majority of these stocks do most of their business in the US and these charges will raise a very, very big question mark over the sustainability of that business.

Following last week’s extradition of three British bankers to the US, the arrest in Dallas has also fanned a more general anxiety in Britain about the perils of doing business with America.

In London, this is Stephen Beard for Marketplace.

As a nonprofit news organization, our future depends on listeners like you who believe in the power of public service journalism.

Your investment in Marketplace helps us remain paywall-free and ensures everyone has access to trustworthy, unbiased news and information, regardless of their ability to pay.

Donate today — in any amount — to become a Marketplace Investor. Now more than ever, your commitment makes a difference.