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US racketeer behind Betcorp boardroom exodus
By Colin Kruger
September 4, 2004

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After a boardroom exodus which left it with just one director, Australian wagering company Betcorp is understood to be in the hands of its largest shareholder, Bill Scott, who US reports say is a convicted racketeer and fugitive from authorities.

ASX-listed Betcorp is the nation's third-largest wagering company by turnover.

It owns the Darwin-based Sportsbet and World Wide Tele Sports, a US sports-betting business based on the Caribbean island of Antigua, with 120 staff and more than $1 billion in turnover.

The company did not return calls on Friday and statements released to the stock exchange offered no reason for the abrupt departure of its chief executive, Richard Barker, and chairman John Priest.

Mr Barker, who resigned on Thursday, was formerly the director of investment banking at N.M.Rothschild & Sons.

Mr Priest, who resigned last week, was previously finance director of Coca-Cola Amatil.

With the departure of another executive director, Simon Noble, in August, Betcorp is down to one director and was forced to suspend itself from trading on Friday.

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Mr Scott, the man believed to be instrumental in the boardroom exodus, is a bookmaker from Toledo, Ohio, who was jailed for racketeering in 1984, according to The Wall Street Journal.

Another US business publication, Business 2.0, said Mr Scott had been a fugitive from US authorities since being charged with illegally taking online sports bets in 1998.

Mr Scott has based himself beyond the reach of US authorities in Antigua, where he set up World Wide Tele Sports before Betcorp acquired it in January last year. The deal delivered Mr Scott a 27 per cent stake in Betcorp.

Antigua has become a haven for online gambling operations because of its relaxed regulations and extradition laws.

But, despite strong growth in online betting, Betcorp has struggled this year after downgrading its first-half results in April from a $12 million profit to a $2 million loss.

World Wide Tele Sports, which accounted for the majority of Betcorp's revenues last year, was blamed as the main culprit for the loss and led to Mr Noble's departure last month.

Betcorp said Mr Noble, also based in Antigua, had departed for "personal reasons".

Betcorp's local business, SportsBet, has not been without controversy either.

Kim David Faithfull, a former Commonwealth Bank manager in Karratha, Western Australia, gambled away $19 million of the bank's money on the service over five years.

The bank had no idea it was being robbed until Mr Faithfull gave himself up last year.

The recent changes are believed to be attempts by Mr Scott to win control of the business after a lacklustre performance.

Betcorp shares, which traded at 59c before the profit downgrade was announced in April, last traded at 16.5c on Thursday.

The company said that its shares would remain suspended until it had appointed at least two new directors and "additional explanatory information detailing the company's current circumstances can be provided to the market".

Betcorp said that it expected to make an announcement next week.