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September 14th was last Thursday, the day Peter Dicks had his arraignment in New York City to see if he would be extradited, or not, to Louisiana to stand trial. I expected to see a million follow up articles on this subject when I did my Google News search. His arrest seemed to get a mention everywhere I looked, so this was a natural assumption. Peter Dicks was a non-executive chairman of Sportingbet PLC when he was arrested on September 7th while in JFK airport in NYC. Dicks was being held on a warrant filed in May in Louisiana as part of an investigation of illegal gambling. After spending two nights in Rikers he was released on $50,000 bail. He had already surrendered his passport and tickets to reduce his flight risk. He stayed in the New York metropolitan area while awaiting his arraignment yesterday. Dicks has resigned from his job as chairman of Sportingbet PLC and with that loss he regained his freedom. The New York authorities decided not to extradite him to Louisiana and have returned his passport. Dicks has friends in high places. At the hearing in criminal court in the borough of Queens last week, a judge ordered Mr. Dicks’ passport returned. It's rather hard to extradite a man when the warrant for his arrest had been withdrawn. You see, New York Governor George Pataki withdrew the warrant necessary to extradite Mr. Dicks to Louisiana. While this is a relief for Mr. Dicks it doesn't say anything about the case Louisiana had against Dicks or whether it will affect internet gambling on the whole. One can assume not everyone in the online gambling industry has friends which can help them get out of a mess like this one. As such jurisdictional questions about online gambling remain. "Peter Dicks has never committed a crime in Louisiana and assuming that their statute barring online gaming is correct, he did not commit a crime in Louisiana," said Barry Slotnick, Mr. Dicks’ attorney. "Anybody in Louisiana can get on our web site and bet, and if that is a crime in Louisiana then they are committing a crime, not Peter Dicks," Mr. Slotnick concluded. "Mr. Dicks has never been to Louisiana." Sportingbet.com never took their site down and betting continued normally while Dicks was awaiting his arraignment. After the arraignment they did post two statements on their investors' website, the first announced that Dicks had resigned. "Further to its recent announcements regarding Mr Peter Dicks, Sportingbet confirms that, with great reluctance, at 2.25 p.m. today, the Board accepted the resignation of Mr Dicks as Independent Non-executive Chairman of Sportingbet with immediate effect. Mr. Dicks indicated that he wishes to concentrate on personal matters. The Board will announce a new Independent Non-executive Chairman in due course." The second explains Dicks's legal situation. "The Board of Sportingbet can confirm that it has been informed that at a hearing to consider the transfer of Mr Peter Dicks, its former Independent Non-executive Chairman, to Louisiana held at 3.00pm (BST), Mr Dicks was granted an extension to his bail permitting him to return to the United Kingdom. Further, today's hearing has been adjourned until 28 September 2006 after New York Governor George Pataki's office withdrew a governor's warrant necessary to transfer Mr Dicks to the State of Louisiana." In other words, the state of Louisiana still wants Dicks, but as he's now allowed to leave New York for England they may not be able to get him. I'm not sure what the point is of adjourning the hearing until September 28th. Dicks is wanted by the state of Louisiana, and to the best of my knowledge this is the first time that a state has gone after someone running an online gambling establishment who has not set foot in their state for years. Months ago New Jersey arrested and found guilty someone who was promoting and running an internet casino from their state. Washington is shutting down all websites used to promote internet gambling. If Dicks is arrested and actually tried in Louisiana he could be sentenced up to five years in prison or fined up to $25,000. Most cases like this plead out so that no one has to serve any jail time. The one case where the accused didn't plead out, and instead chose to stand trial rather than plea-bargain, ended up having the defendant serve two years in prison. Jay Cohen was the chief executive of World Sports Exchange (WSEX) when he was convicted by a U.S. court for taking wagers from U.S. residents and sent to jail for 21 months fined $5,000. Today he is still the only executive of an online gambling firm to serve jail time. Dicks has escaped the chopping block this time around and one might think that the industry as a whole will not be affected by this event. However, Dicks resigned as non-executive chairman and will not be giving his money or advice to any other internet gambling establishments soon. The message sent to business executives who are interested in the financially blooming industry is clear – be careful about traveling through the United States if you work in this industry. The US is on a witch hunt for anyone even related to internet casinos, sports books, or poker rooms. Investors are becoming paranoid on investing in the industry. They don't know what the magic stock ownership percentage is which will get them on some state or federal list. Stock analysts in the US are not sure whether they should continue trading in internet gambling stock on AIM (the London small stock exchange). Life at Sportingbet PLC continues. Their punters are betting and their company is moving forward. Their investors page has a small list of what their future holds: "Current Group Finance Director, Andrew McIver, to be appointed CEO from 17 October 2006. Nigel Payne to remain an Executive Director, responsible for regulation and business development. Process for appointing new Group Finance Director underway." Their stock went back up 10 percent when insiders speculated that Dicks wouldn't be extradited and rose another 15 percent when the warrant against Dicks was withdrawn. It's almost as if Peter Dicks was never their chairman, and his arrest didn't happen. Posted on: September 17, 2006
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