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BetOnSports History

BetOnSports offered poker as a secondary product behind its bookmaking operation.  The site launched poker in 2004.  It used Dobrosoft software.  The poker site never reached critical mass.  It was more of an afterthought.  The U.S. Justice Department became interested in the sports betting segment of the operation.  Online poker players got caught up in the sting and lost most funds on deposit.

Officers Arrested

David Carruthers was the CEO of BetonSports. Carruthers started his career in gaming at Ladbrokes where he gave the company 24 years of service. Carruthers accepted the CEO position with BetonSports in 2000. On July 16, 2006, he was arrested while changing planes in Dallas, Texas. He was on his way back to Costa Rica, where the company headquarters was located, after attending the annual meeting in London. In April 2009, Carruthers pleaded guilty to racketeering and was sentenced to 33 months in prison.

Gary Kaplan was the founder of BetonSports. On March 28, 2007, Kaplan was arrested in the Dominican Republic based on charges that were unsealed in the Eastern District of Missouri related to racketeering and violating the Wire Act of 1961. In August 2009, Kaplan was sentenced to four years in prison.

On August 10, 2006, BetonSports announced that it would close. This was due to the pending legal action taken against its officers. It also found that many processors refused to do business with the sports book and had locked their ewallet processing accounts. In addition to the issues related to locked accounts, U.S. authorities sought $4.5 billion is asset forfeitures from 11 people associated with BetonSports.

Bailout

Betcris, a well respected sports book, entered into negotiations with BetonSports in an attempt to pay their Costa Rican employees as well as bailout players. A bailout for U.S. players was never successful. BetonSports did offer players outside the U.S. the chance of recovering their balances. Non U.S. player balances were transferred to Betcris. Players had the option of either wagering their existing balance 10 times to have the ability to withdraw or make a deposit matching their balance and have a five times wager requirement.

Liquidation Settlement

BetonSports players in the U.S. were forced to enter a remission process through Kurtzman Carson Consultants. The liquidation process took four years. In July 2011, players in the U.S. that applied for a refund were paid 4.63% of their available balances. That was all that was left after liquidating the BetonSports assets and paying attorney fees, court costs, and liquidation costs. Players were given until September 28, 2011 to cash their checks. All checks that were not cashed by that date were voided.

While BetonSports was publicly traded, it was not a well respected brand. The company was involved in several scandals. The company was accused of copying the sportsbook review site Sportsbookreview.com. They then created a recommended list of sports books that included their brands on their website Sportsbookaudit.com. The company was accused of slow paying customers as early as 2004. A marketing director was also accused of taking illegal kickbacks. There were also reports of fraud and embezzlement by senior management. In addition to these issues, there were many customer service complaints.

Lessons Learned From Failure of BetOnSports

BetOnSports had all the looks of a legitimate operation.  It was licensed in Antigua, one of the most respected jurisdictions at the time.  The company was publicly traded in London on the AIM, another sign that there should be no trouble.  BetOnSports opened in 1995 as a phone betting operation so it has more than 10 years in business before it failed.  The lesson learned is that there is never a time to keep life changing money on an offshore sports betting site, no matter how financially strong it appears.

Another important lesson for players outside the U.S. is to keep money away from sites that accept Americans without proper licensing.  This keeps players from jurisdictions where gambling is legal away from potential legal action.

BetOnSports did not have much of a reputation in the sports betting world.  The company was accused of plagiarism.  It also published a shill sports betting watchdog site that referred players to its sites.

What BetOnSports Was Like

BetOnSports was mostly a sports betting operation.  It included sites like MVP Sportsbook, BettorsTrust, EasyBets, V-Wager, Gibraltar, and Millennium Sportsbook. Many of these were well known books in their day.

The poker site that serviced these sportsbooks was distributed by Dobrosoft.  The software was simple and adequate.  Dobrosoft was the only platform on the market that had the functionality to allow players to straddle under the gun and chop blinds if everybody folded to the last two players.

The only games that received much action were fixed and no limit Texas Hold’em.  The limits were mostly in the micro limit area.  BetOnSports offered Big O, a five-card Omaha game.  It was available in high and high/low formats.  No other poker site offered the game at the time, even those powered by Dobrosoft.

The BetOnSports Dobrosoft poker platform is still in service today.  It operates the Winning Poker Network.  David Carruthers, the CEO that was imprisoned for his role at BetOnSports, currently lives in the United Kingdom. While the poker software is still alive, the Big O game never resurfaced.

Scandals Related to BetOnSports

The collapse of BetOnSports was not related to any other failed poker sites.  However, several failed sites used the same Dobrosoft platform.  Many licensees failed due to poor financial strength going into the online poker venture.

BetOnSports Player Impact

BetOsSports players had deposits stuck in limbo for five years.  CEO David Carruthers was arrested in July 2006.  Players did not receive checks until July 2011.  Players had to file an application for the funds.  The settlement only paid $.0463 on the dollar.  This made it so that most players did not bother to claim the lost funds.

Related Failed Sites

BetOnSports Timeline

• 1995
  BetOnSports launches phone sports betting operation.
• 1999
  BetOnSports unveils new sports betting website.
• 2004
  BetOnSports opens poker site.
• 2006
  CEO David Carruthers arrested changing planes in United States, site shutters.
• 2009
  BetOnSports founder Gary Kaplan pleaded guilty to role in BetOnSports, sentenced to four years in prison.
• 2010
  Carruthers pleaded guilty to part on BetOnSports.
• 2010
  Carruthers sentenced to 33 months in prison.
• 2011
  Carruthers released from U.S. prison after serving 14 months.
• 2011
  BetOnSports players receive 4.63% of funds, assuming an application was filed.
• 2011
  Kaplan released from prison.

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