Money Laundering through Internet Gambling Site Generates Indictments

William Scott and Jessica Davis, apparently operated an online casino and sports gaming site in order to launder funds. On May 18, 2006, the U.S. Department of Justice revealed indictments against both Scott and Davis who are now apparently fleeing to avoid prosecution.

The website, WorldWide Telesports, Inc. permitted gaming enthusiasts to call in bets using toll-free lines and place bets via the Internet through multiple web pages. In a total of twelve counts, the Justice Department charges that the two ran a $2.5 billion operation offshore the resulted in American gambling dollars being diverted to Antigua. The Justice Department seeks $250 million in compensation for the crime.

Additionally, Scott is indicted for failure to report accounts in foreign banks to the U.S. Internal Revenue Service.

While there is little government control on Internet gaming, the trend toward prosecuting illegal proceeds from gambling is on the rise. More indictments can be expected to be disclosed in the near future as the U.S. government cracks down on this extremely profitable criminal activity.

Moves toward establishing regulations for legal Internet gaming is in the works. Since many countries have made online gambling a legal, profitable tax base, and since many U.S. states have legalized gambling, it is clearly in the best interest of the gambling enthusiast and the government to legalize and establish controls and safe-guards on Internet gambling.

Of course, there is more at stake here than simple online gaming. Laundering money through foreign banking to avoid taxation is part of the reason Internet gaming in not technically legal in the U.S. today. Proper transactions of gaming business must be accounted for, winnings must be reported and taxed to avoid criminal charges.