Agreeing that a decades-old U.S. law aimed at 789betting can be used in at least some instances to go after Internet gambling operators, a federal appeals court on Tuesday upheld the conviction of a former stockbroker who accepted Americans’ sports bets from the Caribbean island of Antigua.

IN UPHOLDING the first Internet gambling conviction under federal law, a three-judge panel for the Second Circuit of the U.S. Court of Appeals found no merit in the six legal points raised in Jay Cohen’s defense.

In a 23-page ruling, Circuit Judges John Keenan, Pierre Leval and Fred Parker said Cohen’s contention that he believed his sports-betting business, which was licensed by the Antiguan government, was operating legally was immaterial.

The court also rejected arguments that clients of World Sports Exchange were only transmitting betting instructions by telephone and over the Internet, since they were required to open bank accounts in Antigua before they could begin wagering.

Nor did the judges accept Cohen’s contention that it is not illegal to place a sports bet in the state of New York, or to receive such a bet in the sovereign nation of Antigua.


Cohen, a 34-year-old former stock trader, told shortly after the ruling was announced that he planned to appeal.

“I’m shocked but we’ll keep fighting,” Cohen said from San Francisco, where he has been living while free on bail pending a ruling on his appeal. 

Online gambling goes global – Big players join Net gambling gold rush; American bookies stranded in paradise; New challenges for ‘Cyberspace Vegas’; INTERACTIVES: A worldwide phenomenon; Sizing up Internet gambling       Melinda Sarafa, an attorney with the New York City law firm of Brafman & Ross, which represented Cohen, said his legal team would petition the Supreme Court to hear the case if it is unable to persuade the Court of Appeals to rehear the case.

“We’re very disappointed with the decision and don’t believe it has fully addressed the issues,” Sarafa said. “We think we submitted a very compelling case for reversal.”

Marvin Smilon, a spokesman for the U.S. Attorney’s Office for the Southern District of New York, declined to comment on the decision.

Cohen, who co-founded World Sports Exchange in 1996, was one of 21 U.S. citizens named in a series of highly publicized indictments in 1998 that charged them with illegally using interstate telephone lines to take online wagers from U.S. customers. The indictment said such wagers violate the federal Wire Communications Act, a decades-old statute aimed at bookies that prohibits use of phone lines to bet on sporting events. 

Internet Roulette: MSNBC’s report on the high-stakes showdown on online gambling

But while the other 20 entered guilty pleas prior to trial, were dropped from the case or are fugitives — including Cohen’s former business partners, Steve Schillinger, Spencer Hanson and Haden Ware — Cohen elected to return to the United States to fight the charges.

Prosecutors argued that language in the Wire Communications Act barring “use (of) telephone lines … for the placement of sports bets, or for the transmission of information assisting in the placing of bets on sporting events and contests” clearly applied to Cohen.



Social links:

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s