Nation’s first UIGEA prosecution and conviction
BOSTON - Two men were sentenced today on charges of racketeering and related offenses as a result of their participation in a large scale offshore gambling business which utilized an Antiguan Internet site and employed gambling agents in Mass. and Fla.
In December 2011, following a five week trial, Daniel Eremian, of Boca Raton, Fla. and Todd Lyons, of Beverly, Mass., were convicted of racketeering (RICO), racketeering conspiracy, operating an illegal gambling business and wire act offenses. Lyons was also convicted of money laundering, filing false tax returns and interstate travel in aid of racketeering. Both were found not guilty on several other charges related to their gambling business. Co-defendants Robert Eremian and Richard Sullivan remain fugitives in this case.
U.S. District Court Judge Patti B. Saris sentenced Eremian to 36 months in prison to be followed by one year of supervised release and $7.7 million in forfeiture. Lyons was sentenced to 48 months in prison to be followed by one year of supervised release and ordered to pay $24.5 million in forfeiture. Both men were ordered to surrender to the U.S. Marshal’s tomorrow morning at 9:00 a.m.
Lyons was the first defendant in the U.S. to be charged and convicted of violating the Unlawful Internet Gambling Enforcement Act (UIGEA). The statute was enacted by Congress in 2006 to deter the use of the U.S. banking system to pay Internet gambling debts incurred by U.S. citizens.
Daniel Eremian and Robert Eremian built a massive online gambling ring called “Sports Offshore,” based in Antigua. The ring employed approximately 50 gambling agents in the United States, who had hundreds of customers. The government presented evidence that this gambling business laundered more than $10 million in checks and wire transfers. Daniel Eremian and Lyons helped run “Sports Offshore” from at least 1997 to 2010. Daniel Eremian originally solicited gambling customers from a Peabody bar and eventually moved to Fla. where he continued to collect money from other gambling agents. Lyons acted as an agent in Mass., driving throughout the state to collect millions of dollars lost by gamblers. The defendants often used FEDEX to ship cash and checks back and forth to Antigua and also utilized a mail drop in Belize to receive proceeds of illegal gambling activities.
U.S. Attorney Carmen Ortiz; William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Colonel Marian McGovern, Superintendent of the Massachusetts State Police made the announcement today.
The case was prosecuted by Assistant U.S. Attorneys Fred M. Wyshak, Jr. and Robert Fisher of Ortiz’s Public Corruption & Special Prosecutions Unit.