Internet gambling executives in Britain were told yesterday that they are vulnerable to fast-track extradition to the United States because their businesses are breaking American tax law, following the detention in the US of David Carruthers, chief executive officer of online gaming group BETonSPORTS. 2

Internet gambling executives in Britain were told yesterday that they are vulnerable to fast-track extradition to the United States because their businesses are breaking American tax law, following the detention in the US of David Carruthers, chief executive officer of online gaming group BETonSPORTS.

Concerns are also growing that an anti-terror agreement by Europe to hand passenger flight lists to the US may have been used by FBI and tax agents to swoop on David Carruthers, the BetOnSports chief executive.

America’s clampdown on gambling highlights how legal and security arrangements in the War on Terror have made it easier to target British businessmen suspected of breaching American laws.

The US Government last night warned Britain’s online gambling industry that allowing its services to be used within the US could result in criminal charges.

“Internet gambling companies in Britain, in any country, anywhere, if they do business in the United States they do so today at their own risk,” a Justice Department spokesman told The Times. “This is a crime and it can be prosecuted.”

The threat to British online businesses was reinforced by Senator Bob Goodlatte, author of a tough new Bill that would further restrict internet gambling. He urged executives of overseas gambling companies to take note of the BetOnSports prosecution. “They should be wary of the United States exercising its treaty rights to seek extradition,” he said.

Britain will refuse to extradite suspects for breaking US laws against internet gambling. Extradition is available only if conduct is illegal in both the UK and America.

However, executives are worried because the indictment against BetOnSports includes allegations of tax evasion. The company is accused of failing to collect “wagering excise tax” on $3 billion (£1.6 billion) of bets placed by US punters.

British internet gambling executives are vulnerable to fast-track extradition for that offence because they take bets from Americans without charging tax on them. They could argue against extradition because Britain has abolished its own taxes on punters making bets, but they would have little prospect of success.

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