BetonSports Sacks Arrested Ceo

The online gambling company BetonSports today sacked its chief executive after his arrest in the US on fraud charges.

David Carruthers was arrested last week at Dallas-Fort Worth international airport, Texas, while on his way from the UK to Costa Rica, where BetonSports is based.

BetonSports today issued a statement distancing itself from its former boss: "On July 24, the contract under which David Carruthers acted as CEO of the company was terminated ... This action was taken as a consequence of Mr Carruthers's continued detention by US authorities.

"Clearly, while he remains in the custody of the US government he is unable to perform his duties. Further, the company has been unable to speak directly with Mr Carruthers."

Mr Carruthers and 10 others, including the founder of BetonSports, Gary Kaplan, were named in a 22-count indictment this week by federal prosecutors. The US government accused BetonSports of fraudulently taking bets from US residents by phone and the internet, and failing to pay excise taxes.

The London-listed company has been forced to shut down 85% of its business since the indictment.

The arrest of Mr Carruthers and the move against BetonSports sent internet gambling stocks plummeting.

Net betting on many sports is illegal in the US, and numerous online betting companies are based offshore to avoid the restrictions. Last week the House of Representatives passed legislation to crack down on internet gambling.

In a separate statement, BetonSports sought to distance itself from others named in the indictment. The company said all its other directors - appointed after the company's flotation in 1994 - were not named in the charges.

"The board wish to make absolutely clear that none of the founders of the original business has any continuing role within the company," it said.

As for Mr Kaplan, its founder, BetonSports said he had a "consulting agreement with the company under which his role is non-management related which was an absolute requirement of the board for the float and thereafter".

BetonSports said it had operated in accordance with the "standards expected of a UK plc" since its listing, adding: "Some media reports have focused on alleged improper activity occurring at the group's Costa Rican business premises during VIP parties and other events. All these allegations relate to the time prior to the acquisition of the business by the company and its July 2004 float."