David Carruthers

David Carruthers (born September 1957 in Edinburgh, Scotland) is a British businessman who was the CEO of online gambling company BETonSPORTS plc from July 2000 until July 2006.

Born in Edinburgh in Scotland, he attended art college before joining Ladbrokes Plc, the UK's largest retail bookmaker in 1976, where he became the youngest betting shop manager at the age of 19.

During a twenty-four-year career with Ladbrokes, Carruthers graduated with an MBA from the University of Wolverhampton and rose to manage business development strategy for Ladbrokes shops in West England.

He managed around forty of the business's then 1,900 high street betting shops, managing the Midlands and south Wales territories.

The Group generated a 276% increase in turnover over the period 1999–2004 and profits before tax rose from US$0.6m to approximately US$26m during the same period.

In July 2000, while it was still a privately held company, Carruthers was appointed as CEO of BETonSPORTS, and tasked with bringing the company to a stock market listing.

He was travelling with his wife, Carol, from the BETonSPORTS Annual General Meeting in the United Kingdom to his home in Costa Rica where the two lived since 2000.

This he achieved in July 2004 when BETonSPORTS plc successfully listed on the London AIM stock market, and raised £54.6 million (at the time US$101 million).

At the time of the initial listing 48.1% of the company's issued share capital was placed with institutional investors.

The offering was underwritten by Evolution Beeson Gregory.

It was the third largest IPO fundraising on AIM during 2004.

Carruthers oversaw rapid growth for the company, which more than tripled its operating profits during his tenure.

He was appointed to the board of directors on 18 June 2004.

BETonSPORTS had a turnover, for the year ended 31 January 2004, of US$1.6 billion.

In 2004, when leading Internet portals Google and Yahoo!

announced they would stop carrying adverts for online casinos, blaming a "lack of clarity" in US regulations, Carruthers told The New York Times:

Carruthers explained to The Wall Street Journal in a 2 August 2004 article: "What happened with alcohol [prohibition] was a disaster," he said.

"Nobody wants this business, which is flourishing offshore, being pushed back onto the streets and the back alleys of the U.S."

He also argues that "there's a huge missed opportunity here" for the US government to collect revenue.

As at 5 February 2005 Carruthers owned 1,185,567 ordinary shares in the company (1.46% of the company based on 81.15 million shares outstanding), and had options for 3 million shares exercisable at £1.40 per share between 15 July 2007 and 15 July 2014.

Carruthers is a noted and vocal advocate of online gambling regulation.

He has frequently engaged in public debate with opponents of online gaming (particularly in the United States), and has argued vociferously for government oversight and taxation of the industry.

He has lobbied for regulation on the basis that would help to protect against gambling abuse and underage gambling as well has provide much needed tax revenue to the US government, he sought support from the government in finding ways to protect consumers.

Carruthers publicly called for transparency among his industry peers and suggested that a good starting point for operators was a public offering of shares.

Carruthers has accepted numerous speaking engagements in which he has lectured on the benefits of regulation.

He has also written magazine articles, newspaper op-eds and a white paper on the topic.

But the cornerstone of his lobbying efforts was a grass-roots campaign encouraging American consumers to voice their disapproval of prohibition efforts.

He was arrested in the United States on 16 July 2006 on charges related to his role as CEO of the company.

He was subsequently convicted of racketeering conspiracy, and sentenced to 33 months in prison.

In the fiscal year ending 5 February 2006, the company reported a 65 percent gain in operating profit on continuing operations to $20.1 million.

The company said it handled $1.77 billion worth of bets for the year, up 25 percent.

Representative of his arguments for regulation is a 2006 article in The Baltimore Sun by Carruthers:

On 4 April 2006 Carruthers debated Rep. James A. Leach (R-Iowa), on the merits of Rep. Leach's Unlawful Internet Gambling Enforcement Act (H.R. 4411, part of which became part of the Safe Port Act).

In response to Rep. Leach's rhetoric, Carruthers presented the case for the regulation of the online gambling industry in the United States.

On Sunday 16 July 2006 Carruthers was arrested at Dallas/Fort Worth International Airport in Texas while changing planes.

(At that meeting held on Friday, 14 July, he had publicly announced that the chances of the Unlawful Internet Gambling Enforcement Act of 2006 (H.R. 4411) being passed by the US Senate were "remote".)

On 21 July Carruthers was still jailed in Fort Worth, Texas awaiting a bail hearing concerning federal charges filed in Missouri related to his company taking wagers over the telephone and Internet from US citizens.

While the indictment against the 12 defendants in the case includes 22 counts, Carruthers is only charged with count one, the Racketeer Influenced and Corrupt Organizations Act (RICO) charge.

Other charges include 'Mail Fraud', 'Transmission of Wagers/Wagering Information', 'Interstate Transportation of Gambling Paraphernalia', and 'Interference with Administration of Internal Revenue Laws', specifically the evasion of Federal wagering excise taxes.

Coming straight after the controversial extradition of the NatWest Three, to which it has been compared because both cases involve the indictment of non-US persons for actions taken outside the United States, the Carruthers case has attracted much media attention.