It’s no secret anymore: indictments against Legends Sportsbook have been unsealed and the owners have decided to cease operations. Legends operated on a few different domains over the years, most recently betlegends.eu, where the website appears to be running for non-wagering purposes.
The management has decided to transfer all player balances to another SBRForum.com “A Rated” sportsbook. This is a departure from the normal routine of simply paying out all players and closing doors. We speculate Legends does NOT have the money to cover all its USA player balances. Therefore, by transferring accounts to another sportsbook, the money becomes that sportsbook’s liability. Of course, USA based customers might decided to wager at the other sportsbook, in which case the account balances *might* become an asset. It will be interesting to see who takes Legends’ orphaned players and how many customers yank their money out for good.
This development isn’t surprising in the least, and is just another offshore sportsbook falling under the weight of USA law enforcement. It has now been revealed that Legends was offering some credit wagering, which isn’t standard operating procedure for post-up sportbooks that take money upfront before accepting a bet. Perhaps agents in the USA went state’s evidence under legal pressure. Additionally, Legends owners living in Florida were transferring money back to the state for living expenses, including a personal jet. This officially qualifies as money laundering in the eyes of the DOJ.
Although the news is breaking as a “Legends problem”, in reality others were snagged in the indictments. The owner of The Greek was also named, another top rated sportsbook with a solid reputation in the industry.
It seems odd that the DOJ has targeted sportsbooks that have – for the most part – done right by their customers. They have functional betting software, responsive customer service, and pay winners as fast as possible. Sportsbooks aren’t awared a “A” rating from SBR for nothing. Essentially, this case is not about ripping off Americans who willingly bet offshore, but more about economics. The DOJ claims in excess of $1 billion was taken by the indictees, and that money should have stayed in the USA where it could have been taxed and regulated. Once money leaves American shores it still must be reported by USA citizens, but it is beyond the reach of law enforcement unless the citizen or financial institution holding the funds is compelled to bring them back (also known as repatriating assets).
These developments naturally beg the question, who’s next? Bodog founder Calvin Ayre is already under indictment and has secured one of the best defense attorneys in the United States to argue his case in lieu of turning himself in. Ayre has no plans to set foot in the USA, and extraditing him from a friendly USA ally might be difficult given his crime is financial and not violent. In the eyes of most other countries, Ayre has done nothing wrong. The same holds true for every other sportsbook operator on the USA radar.
Will this spell the end of offshore sports betting? Not quite. While legalized online poker and casinos games will soon go live in Las Vegas, Delaware, and New Jersey, sports betting is not likely to become legal soon. We use “soon” as a relative term: if poker and casino games prove profitable, someone will suggest online sports betting become legal and regulated inside the USA. Unfortunately, strong lobbies for the NFL, NBA, NHL, and NCAA are diametrically opposed to ANY form of sports betting whether or not it is offline or online. Convincing these groups that legalized online sports betting in the USA would keep each respective league’s games clean would be an uphill battle, but not impossible by any stretch of the imagination.
It seems the DOJ lashes out at those thumbing their noses at USA law enforcement. Strangely, companies that were formerly accepting United States customers through 2006 have NOT been prosecuted. They left the USA market and perhaps made deals with the government behind closed doors. In fact, 888.com was just approved for an online operator’s license in Nevada, despite the fact it welcomed USA customers until 2006 when the UIGEA (Unlawful Internet Gaming Enforcement Act) was passed. They were wise to leave and bide their time, but aren’t exactly squeaky clean all things considered.
The fate of the Legends and The Greek owners really comes down to their own personal legal maneuvers. Those outside the USA might remain in their host countries until it is absolutely necessary to settle up with the DOJ. Those inside the USA are likely lawyering up and brokering deals. Among a group of indictees, the first to cooperate with the government get no penalties or reduced sentences. Hopefully the hubris that typically personifies offshore sportsbook owners won’t get in the way of their better judgment. It might be better to finish the show now and move on to other things, even if that includes a substantial forfeiture of assets and potential jail time.
Keep your ear to the rail, this case is still developing.
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