A week after the arrest of the CEO of betonsports.com, executives at one of the largest online sportsbook for US customers are still trying to decide what the arrest will mean for the online gambling industry moving forward.

Sportsbook.com, one of the most well known internet sportsbooks around generated over 2 billion in sports wagers and over 5 billion in casino wagers last year alone. A huge chunk of sportsbook.com’s customers are use based and those same players seem to be quite nervous with recent events.

Last Sunday, David Carruthers, CEO of Betonsports.com was arrested in Texas while en route to Costa Rica to his companies head office. Carruthers was charged with rackateering and fraud along with a host of other charges. His company’s founder, two sons and media director were also arrested. On Monday, a 22-count indictment was brought forth to betonsports.com that charges Carruthers, 10 others and 4 related companies for taking bets to US residents as violation to the 1964 Wire Act which forbids these same actions.

The recent news of the arrest has sent shockwaves through the online gambling industry and their stocks, plunging to all time lows. The arrest also resulted in Betonsports being suspended on the London Stock Exchange and hasn’t come back to trading since the delisting on July 18, 2006.

Internet Gambling is a $12 billion per year industry worldwide, and growing. This business is technically illegal although not enforced in the United States. Congress has tried for years to pass a bill on banning online gambling but has failed to succeed. Last week, the US House of Representatives passed the bill to be voted upon in Congress in the fall, 317-93.

More recently, bodog.com has been forced to postpone their annual Bodog Conference in Las Vegas for fears of the authorities being on the watch. Calvin Ayre, CEO and founder of Bodog.com and also featured on Forbes.com was quoted saying; “Everybody, at least in the sports betting world, is definitely on notice that the U.S. is being extremely aggressive,” said Sue Schneider, chief executive of St. Louis-based River City Group, which publishes a daily interactive trade magazine. “It’s certainly going to keep people from coming to the U.S.”

One thing is for sure, the sportsbook world better be careful and the casino & poker industries might soon be next.

This entry was posted on Monday, July 24th, 2006 at 12:18 am and is filed under Casino News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.