BetOnSports Online Gambling Kingpin Takes US Plea Deal

BetOnSports founder Gary Kaplan accepted a plea arrangement with the US government, costing the online gambling magnate over $40 million and another year or two in federal prison.

Gary Kaplan, the man who founded the BetOnSports online gambling empire, brought years of investigation to a close today by accepting a plea deal arranged with the US Department of Justice. Kaplan pled guilty to federal racketeering and conspiracy charges, and will forfeit $43.6 million as well as serving a likely two more years in prison.

Kaplan specifically pled guilty to violating the Wire Act of 1961, which forbids the transmission of sports betting. Prosecutors charged Kaplan had advertised his business in such a way as to deceive US residents into thinking his service was legal. The US attorneys handling the case asserted that Kaplan assured players their money was safe, but patrons lost over $16 million when the site shut down in 2006.

Online gambling observers say the lost money was a case of self-fulfilling prophecy by the US government, who told players their money was at risk and then made it so by hounding BetOnSports out of business.

Kaplan admitted to violating federal law, but did not accept the validity of the law.

"Nevertheless, I do not agree with the U.S. stance against offshore telephone and Internet sports betting," said Kaplan. "But I do accept full responsibility for my decisions."

A judge will decide how much time Kaplan must serve. The recommend guideline would be between 41 and 51 months, with Kaplan having already been held for 29 months.