OFFICE OF THE UNITED STATES ATTORNEY
WESTERN DISTRICT OF MISSOURI
Contact Don Ledford, Public Affairs ● (816) 426-4220 ● 400 East Ninth Street, Room 5510 ● Kansas City, MO 64106
FEBRUARY 18, 2010
FOR IMMEDIATE RELEASE
LIBERTY MAN PLEADS GUILTY
TO ILLEGAL GAMBLING
SPORTS BOOKMAKING OPERATION USED WEB SITE,
COMPUTER SERVER IN COSTA RICA
KANSAS CITY, Mo. – Beth Phillips, United States Attorney for the Western District of Missouri, announced that a Liberty, Mo., man pleaded guilty in federal court today to conducting an illegal gambling business that relied on a Web site with a computer server located in Costa Rica.
Charles J. Simone, 24, of Liberty, waived his right to a grand jury and pleaded guilty before U.S. Magistrate Judge Robert E. Larsen this afternoon to a federal information that charges him with conducting an illegal gambling business.
By pleading guilty today, Simone also agreed to forfeit $10,000 to the government, which represents his share of the profits from the gross wagers of the illegal gambling business. Simone agreed to pay $5,000 today and $5,000 prior to his sentencing hearing, which has not yet been scheduled. Simone also agreed to forfeit a laptop computer that was seized from his residence by FBI agents on March 31, 2009.
Simone admitted that he was involved in an illegal sports bookmaking business that began operating in the Kansas City, Mo., metropolitan area in March 2006. Simone began conducting business as a bookmaker on Dec. 21, 2008, and continued to March 31, 2009. Simone was responsible for multiple bettors, primarily located in Kansas City, Mo., who wagered a total of more than $147,287 during the course of this illegal sports bookmaking business. Bookmakers received a percentage of the winnings at the end of each sports season. For example, Simone received 25 percent of his bettors’ losses at the end of the 2008-2009 National Football League season.
Simone and other bookmakers provided their bettors with a 1-800 toll-free telephone number and a Web site. In order to place a wager on a sporting event, the bettor would call the number or access the Web site, then provide their account number and password. Simone and other bookmakers used a separate 1-800 toll-free telephone number, or the Web site, to track their bettors’ activities and account balances.
Both of the 1-800 numbers routed to a company located in Costa Rica that employed more than five people in the operation of this illegal sports bookmaking business. Under this scheme, the Costa Rican company acted as a virtual wire room for the illegal sports bookmaking operation – taking wagers and keeping electronic records of bettors’ activities and results on a computer server located in Costa Rica. The Costa Rican company did not have an interest in the outcome of the wagers, but charged the illegal sports bookmaking business a fee for managing each bettor’s account.
Simone and other bookmakers paid out or collected cash in person from their bettors, usually on a weekly basis.
In a separate but related case, Michael V. Badalucco, 26, of Kansas City-North, pleaded guilty on Feb. 10, 2010, to being a bookmaker for the same gambling operation.
Under federal statutes, Simone is subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Jess E. Michaelsen. It was investigated by the Federal Bureau of Investigation and the Kansas City, Mo., Police Department.
This news release, as well as additional information about the office of the United States Attorney for the Western District of Missouri, is available on-line at