17 Indicted in Bust of $32 Million Online Gambling Ring
A grand jury in Queens has indicted 17 people for operating an online gambling ring that allegedly used an offshore website and a toll-free telephone number to help book $32 million in illegal sports wagers placed by more than 2,000 bettors in the United States.
Prosecutors allege that the 17 people involved in the case used the website www.365Action.com and an 800-number to book bets and organize payments. The operation allegedly accepted credit card and bank deposit payments ranging from $5,000 to $270,000, as gamblers placed bets on college and professional basketball, football, hockey and baseball.
If convicted, the defendants could each face up to 25 years in prison.
The ring at the center of Tuesday’s bust laundered profits through a scheme of depositing and withdrawing cash from banks across the country, according to prosecutors. Some profits reportedly went to memorabilia and other trivia. In communications intercepted by investigators, for example, several defendants discussed plans to pay $10,000 for a classic Batman comic book.
The 126-count indictment was announced by Queens District Attorney Richard Brown and New York City Police Commissioner William Bratton. The charges stemmed from an investigation launched in February 2014 by the district attorney’s Crime and Rackets Bureau along with the New York Police Department’s Organized Crime Investigation Division. The FBI, the Nevada Gaming Control Board, and the Los Angeles Police Department also assisted in the investigation.
Investigators were given court-authorization to electronically eavesdrop on suspects, and claim to have collected hundreds of hours of incriminating conversations. Using these recorded conversations, as well as surveillance and intelligence, investigators traced the ring to Santa Clarita, Calif., where prosecutors allege that 37-year-old Cyrus Irani was controlling and overseeing the operation. Investigators believe that Irani acted as a “bookmaker,” deciding on wager limits, approving accounts and overseeing the operation’s finances.
The New York Times reports that the 365Action site used by the ring appears to be hosted on equipment in Panama that also hosts more than 200 other gambling websites. The site appears to reach the U.S. through an Internet link in Miami, according to public data examined by The Times. No representative for 365Action was available for comment when FRONTLINE called a telephone number listed on its website.
The details of the case follow similar patterns to other online gambling operations detailed in two reports published this month by The New York Times, in collaboration with FRONTLINE. The stories uncovered a dark panorama of online gambling rings across the world that use websites registered overseas and a technological infrastructure within the U.S. to move billions of dollars in bets. As The Times noted in the most recent report:
Because the websites are registered abroad, they have remained out of the reach of United States prosecutors. Each time investigators bust a ring based on one of the websites, a new cast of field agents springs up like weeds after a mowing.
Despite their foreign bases, many of the websites have secretly developed a digital presence in the United States, leasing hosting services in local data centers or signing contracts with so-called content delivery networks, which maintain clusters of servers in cities around the United States.
In a statement, Queens’ district attorney Brown dismissed claims that online gambling is a victimless crime.
“Internet gambling has been compared by some to the crack cocaine epidemic of the late ’80s and early ’90s,” Brown said in a statement. “It is highly addictive and easy to get hooked. It has been said of Internet gambling that you simply ‘click the mouse and lose your house.”