Pressure mounts on Internet gambling firms

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“Being the director or senior officer of a public company accepting wagers in the U.S. has become a much more uncertain occupation in the near term,” Ayre said in a statement. “The fate of the future of public companies in this space is now open to question.”

An online betting conference in Las Vegas, where industry leaders like Ayre were expected to meet this summer, was canceled after the arrest of Carruthers, whose company was one of the world’s largest online gambling firms.

While the Justice Department has said it is being more vigilant in prosecuting illegal offshore betting, the department said Thursday’s arrest was not a coordinated effort with state authorities.

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“This is a separate state case. I can’t speculate if there will be federal charges, but there will be discussion,” said Louisiana State Police spokesman Dwight Robinette Jr. “Our troopers started taking bets (with Sportingbet) and creating an investigation on this company and Mr. Dicks.”

The warrant was issued in May and Dicks’ name was flagged during a routine customs check at Kennedy.

Sportingbet Web sites continued to operate Friday and company officials said they expected to continue unless told otherwise by authorities.

BetOnSports closed its U.S. Web sites on a judge’s order and fired Carruthers, who remains under house arrest on $1 million bond in the St. Louis area, awaiting trial. He faces 22 counts of fraud and racketeering charges. U.S. customers with gambling accounts have not had their money returned as promised by the company.

“More players with accounts are beginning to worry that they are gambling and depositing money into black holes,” said Sue Schneider, publisher of the online gaming magazine, Interactive Gaming News. “That’s been the biggest injury to the industry and the concern of most companies.”

Meanwhile, lawmakers on both sides of the issue are pushing for change, including a proposed law to prohibit U.S. bank and credit transactions with online gambling operations.

Senate Majority Leader Bill Frist, R-Tenn., says he’s committed to bringing legislation banning Internet gambling to the Senate floor for final passage in the coming weeks.

“He understands that this addiction is on the rise and wants to help beef up regulations and enforcement of an issue that affects some who don’t even have to leave the comfort of their own couch,” said Frist’s spokeswoman, Carolyn Weyforth.

There is some doubt in Washington as to whether the bill will be voted on by the Senate with other more pressing matters to decide on in this session.

Republican Nevada Congressman Jon Porter introduced a bill calling for an 18-month study of Internet gambling that could ultimately create laws to regulate, tax and legalize Internet gambling in the U.S.

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