Las Vegas-based bookmaker CG Technology has tentatively agreed to pay the Nevada Gaming Control Board $5.5 million in what would be the state’s largest settlement involving a gambling company.
CG Technology, the gambling subsidiary of Cantor Fitzgerald and formerly known as Cantor Gaming, operates seven race and sports books in Las Vegas and Henderson, Nev. In October 2012 the company’s vice president of race and sports risk management Michael Colbert was indicted on multiple money-laundering charges, as well as charges of enterprise corruption and conspiracy in New York for his alleged involvement in a gambling ring.
Those charges followed an investigation by the FBI, New York Police Department, NGCB, and the Queens County, N.Y., District Attorney’s Office that led to a 259-page indictment charging 25 individuals with 225 counts related to gambling and money laundering. In August 2013 Colbert pled guilty to a felony charge of conspiracy related to an illegal gambling business in U.S. District Court, Eastern District of New York.
The NGCB contends that Cantor Gaming (CG Technology) and/or its president, Lee Amaitis, “either knew or should have known that Colbert was conducting the illegal activities described in the indictment.”
Based on the indictment, those allegations largely centered on Colbert accepting wagers from “messenger bettors,” which is illegal in Nevada. Messenger bettors deliver wagers to the book and collect debts and deliver winnings to and from the actual bettor.
Casino City Times reported that Colbert worked at CG Technology’s The M Race and Sports Book in Henderson.
According to the indictment, two of those messengers, Paul Sexton and Robert Drexler, placed 6,076 wagers totaling $29.9 million for high-volume bettor Gadoon “Spanky” Kyrollos in 2011 and 2012. Messenger Thomas Ludford allegedly placed approximately 900 wagers totaling $4.4 million, the vast majority for Kyrollos, from August through October 2012.
In September 2013 Sexton pled guilty to fourth degree money laundering and forfeited $600,000.
The NGCB also accused CG Technology of several other violations, including missing and incomplete records on account holders, record-keeping issues, and improper wagering by employees.
CG Technology self-reported accepting pari-mutuel wagers from a messenger, Trevor Price, on behalf of Mike Jelinsky for three days in September 2013.
Jelinsky has been involved in previous Nevada gambling scandals. He was sentenced to 21 months in prison after pleading guilty to illegal bookmaking in 2009 and allegedly was involved with offshore bookmaker International Racing Group.