BetonSports faces mounting cash, legal issues

Cash-strapped BetonSports, Plc. is under the watchful eye of the Financial Services Regulatory Commission which is helping the sportsbook call in debts to pay its creditors and employees.

BetonSports made the announcement on the main page of its Web site Friday, saying the move was made to reassure organizations that funds would be properly used in the settlement of creditors in a fair and balanced manner.

The U.K.-based company has defaulted on payments to customers due to what it calls "cash-flow constraints along with legal and operational interruptions."

Partly to blame, the statement says, are payment processors and publishers who owe the sportsbook a "substantial amount of monies."

The commission's involvement in the matter offers transparency, as it has been ordered by the Eastern Caribbean High Court of Justice to manage and supervise all funds remitted. After its evaluation, BetonSports will pay its monies owed in an order outlined by the commission.

In other legal issues, the company's former CEO, David Carruthers, is calling out the U.S. government over the legal basis of its laws under which he is charged with racketeering and wire fraud.

In a letter to his former BetonSports advisors, Carruthers asks for help in lobbying the U.K. government to support his case. He points to a recent World Trade Organization ruling that sided with Antigua and Barbuda in the Caribbean country's complaint against unfair U.S. gambling legislation as support for his position.

"The U.S. decision to arrest me not only shut down BetonSports, but the actions by the U.S. government have destroyed nearly all the public online gaming companies in the U.K.," Carruthers wrote in the letter.

"Based on what the WTO has now called a treaty violation, more than $10 billion in equity of U.K.-listed companies were wiped away. Three U.K.-listed gaming companies have closed completely and other U.K. citizens have been arrested as well, victims of a policy that the WTO has now determined as unfair and violates their treaties."

courtesy of Erin Warner

News Added: 18 May, 2007

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