Feds Seize More Accounts in Maryland Tied to Online Gambling

Written by:
C Costigan
Published on:
Sep/24/2009

Six more bank accounts connected to online gambling have been seized by the Maryland US Attorney's Office.  These were all Wachovia Bank accounts held by a company called Forshay Enterprises, Inc., with authorities claiming the monies are related to money laundering activity.  Thus far, 15 accounts have been seized in connection to this ongoing investigation.  A company called Electracash, Inc. had its accounts seized in the last couple of weeks as well.   Accounts tied to processors owned by Edward Courdy and Michael Garone were targeted last year.

As Gambling911.com reported this past weekend, the Maryland office has joined forces with the Southern District of New York US Attorney's Office, the Louisiana State Police and the US Customs Office in a more expansive investigation into online gambling activities. 

Gambling911.com first reported last month that the Maryland matter was "getting heated" and quite possibly expanding into other realms.  The US Attorney out of Baltimore indeed set up a new task force placed in charge of going after money laundering activity and mortgage fraud, with online gambling also a key initiative. 

The new Assets Forfeiture and Financial Crimes task force was implemented by US Attorney Rod Rosenstein, a Bush Administration holdover. 

Rosenstein (pictured) has stated that he has "beefed up" his office's work on these crimes because the Justice Department has encouraged the U.S. Attorneys to "follow the money" in mortgage fraud and other financial criminal cases.  Those "other financial criminal cases" we learn involve online gambling.

he new section will be responsible for working with state and local authorities on potential federal forfeitures, handling civil forfeitures, assisting with criminal forfeitures and restitution, overseeing Maryland's Suspicious Activity Report Review Teams and providing advice about money laundering and other financial crimes cases.

The asset forfeiture and money laundering prosecutors are Stefan Cassella and Richard Kay, who are based in the U.S. Attorney's Baltimore office, and Christen Sproule, based in the Greenbelt office.

Cassella, who will serve as chief of the new section, earned a B.S. from Cornell University and a J.D. cum laude from Georgetown University Law Center.  He spent more than 20 years with the U.S. Justice Department's Criminal Division, serving as Assistant Chief of the Asset Forfeiture and Money Laundering Section from 1994 to 2002 and the Deputy Chief from 2002 to 2007. Earlier in his career, Cassella was an Assistant State's Attorney for Montgomery County and a Maryland Assistant Attorney General.  Cassella was sworn in today as an Assistant U.S. Attorney.

Kay earned a B.A. summa cum l laude from the State University of New York and a J.D. with honors from the University of Maryland.  Kay has been an Assistant U.S. Attorney for 19 years, specializing in asset forfeiture matters and serving as the coordinator for the Baltimore office. Sproule earned a B.A. from Cornell University and a J.D. magna cum laude from Georgetown University Law Center.  She served as a law clerk to U.S. District Court Judge Richard J. Leon and spent several years working for private law firms.  Sproule joined the U.S. Attorney's Office in January to handle asset forfeiture and victim-related restitution matters in the Greenbelt office.

On Friday, sources informed Gambling911.com that the task force had been conducting an extensive investigation into online casino powerhouse Golden Casino.  It was revealed that initial attempts to place wagers from within the United States first failed.  Golden Casino is represented by well known industry attorney Larry Walters out of Orlando, Florida.

Gambling911.com also broke the news that the US Attorney's Office out of the Southern District of New York had joined forces with the Baltimore US Attorney.  Costigan Media, parent company of Gambling911.com, filed a Motion to Intervene in the New York Circuit Court as a means of gaining access to sealed affidavit warrants filed by the New York US Attorney during the month of July resulting in the freezing of more than $40 million in funds belonging to both Full Tilt Poker and PokerStars.com.   Costigan Media was granted partial access to these court documents by the Honorable Judge Laura Swain Taylor whose landmark decision is considered a huge win for electronic media outlets as a whole.   Her decision also requires that the New York office notify in advance of upcoming indictments in order that additional information related to the investigation be made public to news organizations such as Gambling911.com. 

Both New York and Maryland have long been active in attempting to quash what is now a multi-billion dollar Internet gambling industry.

The Southern District of New York first indicted 21 online gambling operators in March of 1998 in what later became known as "The Internet 21".  A handful of those individuals still remain at large while World Sports Exchange co-founder, Jay Cohen, returned back to the US to face trial and eventually lost on appeal.  He served just shy of two years in a federal prison.

The Maryland office had been instrumental in ordering online gambling payment processor Neteller to stop catering to its state's citizens in 2004.  At the time, the state warned Neteller that they were "aiding and abetting" in criminal activity.  Three years later the US Attorney's Office out of New York arrested two of Neteller's founders.  Both men would plead guilty and pay fines in the millions of dollars.

Most of the accounts seized as part of the current investigation by Baltimore authorities are located in California cities near Los Angeles (La Habra, Anaheim, and Long Beach), though one is in Cherry Hill, N.J., and another in Sioux Falls, S.D.

The most recent seizure case, which was made public on Sept. 23 on the federal courts online service, PACER, involved the six Wachovia accounts in the name of Forshay Enterprises.

Little is known of the Louisiana State Police role in this cooperative investigation other than that they are fully involved.

In 2007, the state of Louisiana issued several seized arrest warrants for online gambling executives, information made public upon the apprehension of Sportingbet Chairman Peter Dicks while passing through Customs at New York's JFK Airport.  New York State refused to extradite Mr. Dicks and he was later released.  Dicks, who resides in the United Kingdom, returned to the United States to settle with Louisiana authorities in that matter.

Christopher Costigan, Gambling911.com Publisher 

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