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US Attorney says offshore betting "could" be used to fund terrorist attacks
US Attorney for Missouri Catherine Hanaway is becoming an increasingly well known name as the BetonSports crisis rumbles on, and this week the UK newspaper The Guardian fleshed out this colourful personality with an interesting biographical piece written by its reporter in St. Louis.
Hanaway appears to not be aware of the FATF adherence on money laundering and transfer controls widely used in the industry, or independent studies that have given the industry a clean transaction record, for she claims rather dramatically that offshore betting could be used to fund terrorist attacks on America if allowed to continue unchecked.
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The Guardian describes Hanaway thus: "A leading light of the Republican party with close ties to the White House, Missouri's US attorney Catherine Hanaway is the woman behind a crusade against gaming which has put BetonSports' former boss David Carruthers in leg irons and prison clothes.
"Her appointment last year was described by the St Louis Post-Dispatch as the '.....the most politicised in recent memory'. The six-foot, cigar-smoking conservative's political career includes sponsoring a bill to ban bestiality and opposition to tax rises for the wealthy. She backed an attempt to put the 10 commandments in every classroom."
In an interview with the Guardian, Hanaway said BetonSports' practice of taking American bets from its base in Costa Rica caused an unacceptable outflow of money from the US.
"This is a very large amount of money flowing on an unregulated basis out of the US. Any time that much money's flowing outside the US, there are concerns about its destination. Under US laws, legitimate large flows of money are required to be subject to suspicious activity reports, she says"
Although the government had made no specific allegations about the destination of the $125 million of US bets taken annually by BetonSports, it was essential for the American authorities to keep tabs on such cash, Hanaway told the reporter. "We need to check it is not being used for money laundering, drug financing or terrorism. Because it's flowing out of the country in an unregulated way, we simply don't know the ultimate destination."
The Guardian says that Hanaway (42) led George Bush's presidential campaign in Missouri and was rewarded by the White House with the US attorney's job even though she had not practised criminal law for a decade. Her previous role was as the first woman speaker of the Missouri house, where some Democrats described her as "contentious" and "bludgeoning". One electoral opponent dubbed her "the bully of Jefferson City".
Gaming is a rancorous issue in Missouri - bets are allowed on only a few river boat casinos, where punters may lose no more than $500 in a two-hour session. Hanaway has been reported by local media as comparing BetonSports' book-running to the illegal smuggling of pornography or drugs into America. She insists she was referring to the views of others and is being purely pragmatic. "In no way are we making any judgment about whether this should be illegal. It is illegal. This company avoids paying a significant amount of wage tax and excise tax that would be due if it were legally operating."
She adds: "Imagine if something were legal in the US but the UK has decided to make it illegal - and we were importing it into your country via the internet, getting round legal practices, and representing it to your people as legitimate. BetonSports did that."
The evidence against BetonSports includes radio advertisements in which the company describes itself as "legal and licensed", marketing material sent to an address in the suburbs of St Louis and an undercover sting operation that targeted a van used by the company to solicit bets outside big US sports stadiums.
According to the US government, the company "conspired to defraud and has defrauded tens of thousands of residents of the US nationwide by conducting a fraudulent scheme in violation of federal mail and wire fraud statutes". Betonsports has further infuriated the authorities by declining to send an attorney into court, in effect ignoring the proceedings.
The case was deemed sufficiently important for Britain's deputy consul-general to travel from Chicago to attend arraignments on Monday.
Hanaway insisted that she is far from a "way-out conservative", pointing out that, in her congressional career, she reformed the state's adoption laws to protect abused children and she set up a special fund for life science research.
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