SHARES in BetOnSports, the internet gambling company at the centre of a US federal inquiry, were suspended yesterday as the fallout from the arrest in America of its British chief executive sent share prices across its sector reeling.

It also emerged that one of BetOnSports non-executive directors, Lord Glentoran, is the Conservative Shadow Northern Ireland Minister and an Olympic bobsleigh gold medallist. The peer has been accused in Spain over an alleged altercation with border police about whisky and cigarettes said to have been brought in from Gibraltar. However, it was unclear last night whether Lord Glentoran, 71, a former sports minister, and other BetOnSports directors, might be drawn into the US investigation.

The biggest fallout hit Sportingbet, which derives about 50 per cent of its revenue from America. Its shares fell by 100p to 282p, almost half their level before BetOnSports announced on Monday that its chief executive, David Carruthers, had been detained at Dallas-Fort Worth airport.

Although it does not offer sport betting, PartyGaming, the internet poker company, fell 17¾p to 85¼p, down from a flotation price last year of 116p. Almost £1 billion has been wiped from its market value in two days. 888 Holdings, another internet gaming operator, fell 24½p to 168½p.

BetOnSports asked for trading in its shares to be suspended because of uncertainty over its future. It said that its lawyers were reviewing implications of a temporary restraining order to stop it taking bets from Americans and require it to return to punters’ money held in accounts.

City analysts were divided over implications for other internet gambling companies that have American customers. Some felt that the language of the US indictment amounted to a warning to the wider industry, but others said it appeared to be a company-specific issue relating mainly to BetOnSports’ American founder and former owner, Gary Kaplan.

Mr Kaplan, together with Mr Carruthers and nine other individuals, has been charged with 20 felony violations ranging from racketeering to tax evasion, wire fraud, running an illegal gambling operation and money-laundering.

The indictment claims that Mr Kaplan, who was first arrested in 1993 over illegal gambling, failed to pay excise taxes on more than $3.3 billion of wagers from the US. The Department of Justice is claiming $4.5 billion forfeiture from Mr Kaplan, who still has a 15 per cent stake in BetOnSports.

Companies contacted by The Times said that they were analysing implications with their lawyers. Unsurprisingly, no executives had any immediate plans to travel to America.

UK FALLOUT

• PartyGaming
  Market value: £3.41bn Change this week: –22%
• Sportingbet
  Market value: £768m Change this week: –44%
• 888 Holdings
  Market value: £568m Change this week: –16%

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