Utah Indicts Online Gambling Payment Processors
The U.S. attorney for Utah on Friday announced charges against various individuals and companies involved in the processing of payments for online gambling operations.
The news came as a shock that anyone with even the brain the size of a pea would be processing payments for online gambling operators in a state that does not even have a lottery.
None of the companies mentioned in the complaint were using the processors in question following the passage of the UIGEA (Unlawful Internet Gambling Enforcement Act) last October. In fact, one of the companies named, BetonSports, was shut down nearly a year ago.
The defendants live in Las Vegas, but two of the companies involved were based in Draper, a Salt Lake City suburb, according to the indictment.
"We now have a body of information technology and strategy that can cross many jurisdictions," U.S. Attorney Brett Tolman said at a news conference.
The indictment claims banks issuing Visa and MasterCard credit cards were fooled into processing Internet gambling charges. Defendants also channeled Western Union wire transfers through the Philippines.
The 34-count indictment includes charges of racketeering conspiracy, bank fraud, transmission of wagers and money laundering.
The seven defendants are accused of creating three companies to conduct fraudulent credit card and wire transfers for their clients - online gaming sites based outside the U.S., the indictment said.
The first company, CurrenC and CurrenC Worldwide, based in other countries including Korea, Jamaica and the United Kingdom, processed most of the credit card and wire transfers. But two companies, Hill Financial Services and Gateway Technologies, based in Utah, and are accused of providing accounting and technical services for the illegal business and were used to track transactions, Tolman said.
An investigation is ongoing to determine if employees at the Utah businesses were aware they were involved in criminal activity and therefore could also face charges, he said.
"There are layers of facade that have to be pulled back and uncovered," Tolman said.
The indictment seeks to recover $150 million from the defendants as well as real estate, vehicles and other assets under RICO, the federal Racketeer Influenced and Corrupt Organizations law.
None of the defendants is in custody, but all are scheduled to appear in U.S. District Court in Salt Lake City on May 30.
Tolman said the government is not seeking their detention pending the hearing because they are not considered flight risks or threats to the community.
Utah has made it clear that they believe all forms of gambling should be illegal, as opposed to Arizona Senator Jon Kyl who believes it is okay to gamble only if betting on horses.
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Christopher Costigan, Gambling911.com
Originally published May 11, 2007 10:46 pm ET
