06/14/2003 - 7:45 PM ET

THE FUTURE OF COSTA RICA SPORTS BOOK INDUSTRY IN JEOPARDY

Christopher Costigan, Sports911.com
 

Having just returned back from Costa Rica I can report back to 911 readers that nearly every operator I have spoken to is – at the very least – in the early stages of contemplating a move out of this Central American country. (pictured here is Gamblers Avenue office in San Jose, Costa Rica).

What’s wrong with Costa Rica?  The government has implemented a licensing fee that, while not highly expensive, many of the sportsbook principals feel the license itself is completely useless.   

One of the major issues I have heard revolves around the banking system and its failure to accommodate sports betting businesses.  Two prominent brokerage houses also collapsed over this past year, leaving operators with a bitter taste in their mouths.  The situation in Costa Rica is --- to be perfectly blunt --- unstable. 

And it’s not just government issues that concern those running sports books out of this jurisdiction.  Crime has come a little too close to home from a couple of industry people this past year.  A partner in MVP Sportsbook averted a kidnapping attempt by fleeing in his bullet ridden SUV while BoDog’s CEO and three of his associates were robbed at gun point in broad daylight right along side a busy highway.   

There are also other more appealing options opening up, most notable among them being Panama with its clean bustling Miamiesque city and a highly skilled English speaking work force.  One of the sportsbooks moving to Panama City received a huge stack of applications after placing just one ad in the local paper for a job position that pays half of what it does in Costa Rica.  Your typical clerk in Panama City will be making $400 a month.     

Despite the questionable situation in Costa Rica, the majority of operators we spoke to are not ready to pack up and leave just yet.   

VO GROUP (MVP SPORTSBOOK, et al.) – The owners here have considered moving to Panama City, but opted not to at the moment.  They will continue to keep a close eye on the situation in Costa Rica, however.  VO-Group has quite a bit invested in CR with three floors worth of space in an old converted bank (complete with safe that can’t be moved).  (pictured above is a departmental office within the VO Group's large facility located in San Pedro, Costa Rica).

“I’d like our employees to think we are moving,” VO Group CEO, Dalton Wagner joked.  “Since the rumors started this is the first time in years nobody has asked for a raise.” 

BETONSPORTS – This is a huge operation employing more than 1500 people in close to a dozen umbrella betting companies.  Relocating to another jurisdiction would be a feasibility nightmare.  Still, the founder of BetonSports was recently spotted in Panama City while CEO, David Caruthers, and Operations Manager, Scott Kaye, were seen wandering around Antigua (looking desperate to go home we might add).  BetonSports is very likely to be setting up mirror operations in other jurisdictions, but a full move out of Costa Rica is highly unlikely unless they are pressured by the government to do so.  Right now the company maintains a commanding presence in Mall San Pedro.  Some estimates suggest that more than 50% of the mall’s revenue is derived from both BetonSports and its employees. 

SBG GLOBAL – The original SBG Global (then called SBD Global) did start out in Panama.  One day in 1996 the Panamanian Army entered their office and announced a new partnership with the sportsbook.  Too bad SBD Global had no choice but to go along with the new arrangement.  The owners packed up all the equipment in the middle of the night and high tailed it to neighboring Costa Rica soon thereafter.  Tradewinds experienced a similar situation when they opened up in Panama.  

BLUE MARLIN AND INTERNATIONAL DATA SOLUTIONS – Blue Marlin was one of the first five books to set up shop in Costa Rica and they were in the process of moving into another office across the street when we met them this past week.  Their main man Reggie has expressed no interest in moving from Costa Rica just yet, but like a lot of his colleagues, the door is always open and he will keep a close eye on things in the meantime. 

BETUS.COM (LITTLE NASA) – They will be moving their entire office to the Kahnawake Reserve outside of Montreal shortly, though all employees (including ex-employees/massage parlor hostesses) have been sworn to secrecy.  Employees of BetUs cannot wait for them to move from what we are hearing.   

BODOG SPORTS – This book also has expansion plans for Costa Rica and will only move if forced out. 

“It would actually be beneficial to us and the industry as a whole if a lot of books moved from here,” expressed Cole Turner, CEO of BoDog Sports.  “If this happens there will be an abundance of skilled workers and their value will go way up while salaries will become more stabilized.” 

CRIS – Since this book just spent a fortune constructed a new seven story complex that is now practically filled up, it is doubtful CRIS will even consider leaving Costa Rica at this point in time despite the fact that their office has been raided and one of the main principals in the company was shipped back to the States. 

FIRST FIDELITY – Rumor has it they are going to move to Panama City since outgoing calls are much cheaper there.   

GAMBLERS AVENUE – The owner has no intention of leaving Costa Rica just yet, though he is currently meeting with others to discuss expansion opportunities.  It is rumored he will also be scoping out Panama sometime next month. 

BETCBS – Here is a book that has spent time in Aruba, briefly the Dominican Republic and now Costa Rica.   

“We’re pretty settled here and a lot of us have families in Costa Rica so leaving here is not really an option right now,” a representative of BetCBS told 911.  “We just paid the licensing fee here (in CR) and the only way we’ll leave I think is if we are forced out.” 

SPORTBET – While the owners have quite a bit of money invested in condos on Costa Rica’s pristine Pacific Coast, the property values continue to plummet.  Therefore this might be an opportune time to sell and move out of Costa Rica.  We do not know their plans at this point in time.    

BEVERLY HILLS BOOKIE – They are slated to move to Panama City July 1.  Playboy Scott will love it down there from what I’ve been told.  Derrick Levy, who served as Marketing Manager for BHB has decided not to make the trek to Panama City.  He is pictured above with two MVP Bets employees during happier times. 

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