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The indictments and subsequent arrests of several individuals connected with the Panama-based online gambling site, BetOnLine.com, has taken center stage in the New York media, painting everyone associated with the company as "Mob" connected.
"Everyone saw this one coming," said an operator based out of Costa Rica, where most online sports betting sites are based. Joseph Fafone, arrested while trying to fly out of Rochester Tuesday night, was well liked in the industry and maintained close ties with many other bookmakers. "Nobody could understand how or why Joe would fly in and out of the States on a regular basis. He was one of the only guys who did this."
Since passage of the Unlawful Internet Gaming Enforcement Act (UIGEA) in October 2006 and several high profile arrests, most industry operators made the decision not travel to and from the United States. Fafone had once operated out of the BetOnSports office complex in the Mall San Pedro, Costa Rica. Several principals in BetOnSports were indicted in July 2006 with that company's founder, Gary Kaplan, preparing to serve a multi-year sentence.
Queens District Attorney Richard Brown has said this latest series of arrests is essentially a victory against Internet gambling.
"It's highly addicting and easy to get hooked on," said Brown. "In this case, I believe that we will make a significant dent in the illegal gambling nationwide."
In some senses he would be correct. BetOnLine.com is more than the typical "credit shop" Brown has targeted in the past a la the James Giordano and 50KSports.com, among others. These businesses, however, were essentially "credit shops" that would later set up web accounts for their "agents" with little marketing to the general public. BetOnLine, on the other hand, markets heavily to recreational bettors and is one of the few offshore sportsbooks to continue utilizing mailers.
Fafone, who is a survivor of pancreatic cancer, set up shop in Costa Rica in 2000 as a means of "operating lawfully".
"I got tired of having my door busted in by the police all the time," Fafone told Gambling911.com.
Fafone set up a "legitimate" business in Costa Rica, BetOnLine.com (originally Best Line Sports), bringing in partners more astute at marketing. BetOnLine.com was one of the first online gambling businesses to set up in Panama City, Panama.
But BetOnLine.com still utilized "agents", most of whom were based in the U.S., and some of whom had turned "informants". One of these "informants" worked within the Panama operation itself. Last year, a former partner in BetOnLine committed suicide.
The New York media has already labeled Fafone as a "member of the Gambino crime family", which immediately conjures up images of legs being broken, horse heads appearing in one's bed, or worse. Actually, Joe Fafone is a nice soft spoken guy with a good reputation in the industry. He doesn't even seem like the type of guy who could hurt a fly.
Fafone also paid his clients as was evidenced by reports that he had personally delivered $553,000 to one gambler at a Garden City, New York hotel, a deed that ultimately got him nabbed.
"Everybody saw this coming though," admitted the Costa Rican bookmaker who spoke to Gambling911.com. "He was taking a huge chance going back and forth to the States."
Christopher Costigan, Gambling911.com Publisher
