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Trial of off-track horse-betting company in North Dakota
The high-rolling gamblers have left town, but prosecutors say the stakes remain high in the federal trial that began recently of a man and woman accused of handling $99 million in illegal wagers.
Prosecutors say Susan Bala and Raymundo Diaz Jr. set up an unlicensed parlor for off-track horse betting in Fargo and created an organization called "Brixcorp" to disguise the business and avoid paying taxes or fees.
Each faces 12 charges, including money laundering and conspiracy to conduct an illegal gambling business. Nine of the counts carry a maximum penalty of 20 years. Both have pleaded innocent.
"There's no denying when you're looking at the amounts of money in this case, it's a significant prosecution", said U.S. Attorney Drew Wrigley. "By any measure, when you look at the allegations of fraud, this case is significant not just in North Dakota, its significant anywhere".
Bala founded the now-defunct Racing Services Inc., and Diaz served as a vice president. The company was licensed to provide broadcast signals from out-of-state horse races, such as the Belmont Stakes and Kentucky Derby, to betting parlors in the state.
"But it was not licensed to run its own betting parlor", authorities said. Only charities and other nonprofit organizations may run such establishments in North Dakota.
According to the federal indictment, $99 million was wagered at the defendants' unlicensed betting site between Oct. 1, 2002, and April 28, 2003, resulting in $19.7 million in revenue.
Authorities said that gamblers were attracted to the parlor by cash rebates, which are legal in North Dakota but not in Nevada and some other states.
Lawyers for Bala and Diaz have said their clients made mistakes, but did not commit any crimes. Bala has said that she looks forward to having her day in court.
Mark Beauchene, Bala's lawyer, and Joseph Friedberg, Diaz's lawyer, did not return even after repeated telephone calls seeking comment.
The case is one that has already had a significant effect on North Dakota racing; industry insiders note big bettors moved to other sites in other states after the investigation into Racing Services.
Dean Meyer, who recently took over as state racing commissioner, said," He is working to restore the confidence of the regular horse players".
"The handle is down", said Meyer, referring to the amount of money wagered. "It has given us kind of a black eye, no matter how (the trial) comes out".
Bala, 50, helped find the state's first racing simulcast service in 1990, eventually taking over sole ownership of the company. She met Diaz in 1996, while Racing Services was doing business with a Mexican company licensed to operate sports betting books. Diaz, 39, a native of Mexico, was the chief financial officer of that company.
Last summer, a bankruptcy judge approved the liquidation of Racing Services. Lien Games has taken over simulcast wagering in North Dakota.
Bala and Diaz, who live together in Fargo, also face charges in a pending state case.
Source: BonusGambler.com Editors' Choice
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