Feeds

Dotcom casino execs convicted of $32m Coutts bank fraud

GalaxiWorld.com gamble doesn't pay off

  • alert
  • submit to reddit

The essential guide to IT transformation

Execs at dotcom casino Galaxiworld.com got their wrists slapped yesterday for defrauding the Queen's bank of $32 million.

Company CEO Jack Banks and CFO Larry Weltman received fines totalling just $1 million, along with a five-year probation stint from a New York court. They were also banned from returning to the US and from serving as officers of a public company or holding nine per cent of stock in one, Rolling Good Times online reported.

Their crime stretches back to 1995, when they borrowed $32 million from the New York office of Coutts & Co - part of NatWest bank.

They secured the loan on stock from Laser Friendly - a predecessor company to Vegas-like site GalaxiWorld. But they artificially inflated the value of the stock by keeping the bank in the dark on one point - that they didn't have the licenses needed to operate one company Laser Friendly had bought.

The bank ended up losing $28 million of the amount loaned, and shut its New York office last year with losses of $100 million.

The GalaxiWorld site went live in December 1998 and in 1999 ceased being a public company. While Banks and Weltman apparently live in Canada, the company is based in Gibraltar and the casino is operated from St Kitts.

Although their gamble didn't pay off, the two seem to have escaped quite lightly - charges of fraud and grand larceny can apparently mean a 25-year stretch in prison. ®

Related Stories

$50,000 payout for lucky Net gambler
Las Vegas murder - juror's Palm Pilot misconduct
UK ISP offers £500k prize in online ad casino
Online gambling sites accused of rigging the tables

Gartner critical capabilities for enterprise endpoint backup

More from The Register

next story
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
No, thank you. I will not code for the Caliphate
Some assignments, even the Bongster decline must
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Banking apps: Handy, can grab all your money... and RIDDLED with coding flaws
Yep, that one place you'd hoped you wouldn't find 'em
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Primetime precrime? Minority Report TV series 'being developed'
I have to know. I have to find out what happened to my life
Netflix swallows yet another bitter pill, inks peering deal with TWC
Net neutrality crusader once again pays up for priority access
Judge nixes HP deal for director amnesty after $8.8bn Autonomy snafu
Lawyers will have to earn their keep the hard way, says court
Ex-IBM CEO John Akers dies at 79
An era disrupted by the advent of the PC
prev story

Whitepapers

Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Backing up distributed data
Eliminating the redundant use of bandwidth and storage capacity and application consolidation in the modern data center.
The essential guide to IT transformation
ServiceNow discusses three IT transformations that can help CIOs automate IT services to transform IT and the enterprise
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.