Law enforcement agents of the Port Authority of New York and New Jersey arrested Peter Dicks, the non-executive chairman of online gambling firm Sportingbet, in connection with a warrant issued from a tiny parish in the state of Louisiana.

The warrant accuses Mr. Dicks, 64, who was detained late Wednesday night after arriving at JFKAirport from London, of running an illegal Internet gambling business (see Second Gambling Exec Nabbed).

The arrest opens a new front in the United States’ war against online gambling, as one state, Louisiana, with its questionable jurisdiction in cyberspace, has made U.S. travel by executives of web gambling businesses even more hazardous.

Fighting Extradition

The charges against Mr. Dicks seem to be limited to activities related to online gambling, and are not as wide-ranging as those filed against David Carruthers, the former chief executive of BETonSPORTS, who was arrested two months ago (see Feds Deal Web Gambling Blow).

The federal charges filed against Mr. Carruthers, who was fired by his company after his arrest, include money laundering and tax evasion.

The fact that similar charges have not been filed against Mr. Dicks, who is fighting extradition from New York to Louisiana, augurs well for him.

“Over the years these kinds of narrowly defined cases have resulted in a slap on the wrist or a fine after a plea bargain,” said Christopher Costigan, president of Gambling911, a gaming, entertainment, and information site.

“The one person who has chosen to fight was Jay Cohen and he did about 18 months after a long trial,” Mr. Costigan added.

Executive Jailed

In 2000, Jay Cohen, 38, the former chief executive of World Sports Exchange (WSEX), was convicted of violating the Federal Wire Act for operating an online gambling concern.

He is still the only executive of a legal and regulated online gambling firm to be convicted by an American court for taking wagers from U.S. residents illegally.

Mr. Cohen, whose company is based on the Caribbean island of Antigua, was sentenced to 21 months and fined $5,000 after a Manhattan jury found the Long Island-born executive guilty.

“The executives that plea bargained got off a lot easier than Jay Cohen,” said Mr. Costigan. “Sportingbet’s case seems like it might be limited to illegally advertising online gambling services in the state, which is a lot less serious than BETonSPORTS’ case.”

Protecting the Racino

The warrant was issued from tiny St. Landry parish in Louisiana, which has a population of 87,000, according to the 2000 census. It includes cities such as Opelousas, Melville, and Grand Coteau.

St. Landry parish is home to Evangeline Downs Racino, a combination of the Evangeline Downs Racetrack and Casino located in Opelousas.

“There is usually a tie-in when a state has its own homegrown gambling business,” said Mr. Costigan. “They are usually aggressively protecting their casinos from online competition.”

Mr. Dicks is being held in New York pending extradition to Louisiana. Sportingbet issued a statement saying that Mr. Dicks was not in the U.S. to transact business related to the online gambling firm.

Mr. Dicks is a board member of SMCC, a semiconductor manufacturer based in Hauppauge, New York.

Contact the writer:CMedford@RedHerring.com

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