On July 4th, 2016 authorities managed to track down the owners of an online sports betting platform that is said to have been raking in about $927 million a year from just NFL games without even considering the other avenues of sports betting the service was offering.
The platform consisted of three websites – WagerABC.com, TheWagerSpot.com, and Hustler247.org. These were password-protected services that allowed users to place wagers on sporting events. The services allowed for wagers to be placed directly on the website or through a toll-free telephone line.
The head of the operation is California resident Gordon Mitchnick. It has been uncovered that he was spending over $200,000 a month to employ staff in the San Jose area, as well as in Costa Rica. The indictment also includes members Joseph Schneider, Claude Ferguson, and Arthur Rossi. Each of these defendants can face up to a total of 25 years in jail if found guilty on all 57 charges being presented against them.
Ken Thompson is the District Attorney for Kings County that will be presenting the charges against the defendants.
“Illegal gambling is not a victimless crime, it preys on peoples’ vulnerabilities and directly leads to money laundering, loan sharking and a host of other crimes,” Thompson publicly stated. “This huge gambling operation, possibly the biggest one ever to be dismantled by a local prosecutor’s office, allegedly moved millions of dollars around the United States and the world.”
The indictment is accusing that the defendants used a variety of money laundering methods to hide payments. This ranged from electronic wire transfers to new house purchases to hide funds. Mitchnick is personally accused of buying over 20 homes in the California area in an attempt to hide his earnings. Money laundering is a very serious crime that is generally used to hide money from the government to protect a person from either paying taxes or being caught in receiving funds for illegal activities.
Currently, Nevada is the only state that fully allows for sports betting legally. The United States Conference of Mayors used their 84th annual meeting in order to bring illegal sports betting to lawmakers. This group represents a total of 1,407 cities with a population of over 30,000. They claim that over the course of the last year there has been $149 billion earned through illegal sports betting, although this is just an estimate. Their goal is to bring about the legalization of sports betting in a way that it could be taxed and consumers could be protected, while also providing law enforcement with the tools needed to weed out illegal operations. They claim that this would not have a negative effect on the integrity of sport games or outcomes.
“The United States Conference of Mayors and the nation’s mayors believe it’s time for a new approach to sports betting in the United States that could include strict regulation, rigorous consumer protections, taxation of revenues to benefit local communities and robust tools and resources for law enforcement to root out illegal sports betting.”