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- Cantor Fitzgerald gambling arm will pay $22.5 million
- In 2012, Cantor Gaming Sportsbook Director Michael Colbert arrested and charged with Enterprise Corruption, Money Laundering, Promoting Gambling and Conspiracy.
- Colbert faces up to five years in prison for assisting illegal gambling group known as the “Jersey Boys”
- Cantor Gaming avoided criminal charges by signing the nonprosecution agreement
Authorities on Monday announced that Cantor Fitzgerald’s gambling arm has agreed to pay out $22.5 million to settle allegations of illegal gambling and money laundering in a matter that had ties to offshore sports betting powerhouse Pinnacle Sports.
Now known as CG Technology, the company originally formed as Cantor Gaming and became one of the biggest sports book runners in the world, operating the books in such prestigious Vegas establishments as including the Venetian, the Hard Rock Hotel and Casino and the Cosmopolitan. Cantor has since distanced itself from that business.
From the New York Times:
The settlement, a nonprosecution agreement, resolves a yearslong investigation into the gambling affiliate of Cantor Fitzgerald, a financial firm that over the last decade moved deeply into the gambling business by applying Wall Street technology.
It was in October of 2012 Michael Colbert, then Sportsbook Director for Cantor Gaming, and two dozen others were arrested as part of a 259 page indictment charging each of the individuals with Enterprise Corruption, Money Laundering, Promoting Gambling and Conspiracy.
Prosecutors out of Brooklyn, New York accused Colbert and others of breaking federal and state laws by allowing sports bettors to place their wagers via proxy and across state borders.
Prosecutors also allege Colbert aided an illegal gambling ring known as the “Jersey Boys”. If convicted he faces up to five years in prison.
The terms of the Cantor settlement require the company to pay $16.5 million to settle the investigation by the US State attorneys in Brooklyn and Nevada and another $6 million to the Treasury Department’s Financial Crimes Enforcement Network.
Cantor Gaming avoided criminal charges by signing the nonprosecution agreement, which is akin to corporate probation, the New York Times reported.
“Cantor Gaming quickly grew into one of the largest race and sports book operators in the United States,” Robert L. Capers, the United States attorney for the Eastern District of New York, which includes Brooklyn, said in a statement. “Unacceptably, this growth came at the expense of compliance with the law, and as a result Cantor Gaming became a place where at least two large-scale illegal bookmakers could launder their ill-gotten proceeds.”
Chad Millman of ESPN.com revealed at the time that total payouts by Cantor Gaming were in the tune of $50 million with bets on horse racing, pro and college football, basketball and other sporting events. Pinnacle Sports, based out of Curacao, was named in the indictment.
- Jagajeet Chiba, Gambling911.com
