Announcing its withdrawal from the U.S. market earlier in September, 5Dimes has now reached a settlement with the U.S. government to pay $46.8 million as a result of a money laundering investigation.
5Dimes Settles Multi-Million Money Laundering Case with U.S. Government
Costa Rica-based sportsbook 5Dimes has reached a $46.8 million with the U.S. government, ESPN reported on Wednesday. The settlement followed a federal money laundering probe into the operator’s business over the past decade.
According to sources, the company agreed to pay $15 million upfront in cash and released $30 million in assets to foot the bill. At the beginning of September, 5Dimes announced that it was withdrawing from the U.S. market, a move that now has more context.
As part of the settlement, 5Dimes agreed to stop servicing U.S. customers out of Costa Rica. The U.S. Attorney’s Office for the Eastern District of Pennsylvania brokered the settlement
Laura Varela, the widow of the original 5Dimes owner, William Sean Creighton, was absolved from any criminal conduct. Varela stepped in at the tilt after Creighton was kidnapped in September 2018 and was found dead a year later.
Creighton was kidnapped by six men. Two were masked as Costa Rica traffic police and stopped him as he was driving through the neighborhood of Granadilla de Curridabat.
At that time, four nondescript individuals joined them and forced Creighton into a van. His family paid a ransom worth $1 million, but Creighton never returned.
In the settlement, Varela claimed that she had no day-to-day authority over the operations of the sportsbook.
Commenting on these developments, U.S. Attorney for the Eastern District of Pennsylvania Michael Lowe said that from the standpoint of authorities, the settlement has been a complete success.
Why Was a Federal Investigation Necessary?
William Creighton started 5Dimes back in 2000. A native to West Virginia, Creighton decided to relocate to Costa Rica and avoid complications with authorities. 5Dimes quickly rose to prominence, servicing Nevada, but quickly growing to accept sports bettors from all states.
5Dimes held the title as the best sports betting operator for a long while. With its growing popularity, it attracted attention from the federal authorities. 5Dimes used third-party payment processors to circumnavigate bans on specific payment methods. That way it allowed mainland U.S. residents to place and withdraw bets.
The website even advised bettors to use gift cards to make their bets, as it was the safest and most hassle-free way to complete a wager. All of that led to 2016 when the Eastern District of Pennsylvania and the Department of Homeland Security formally announced a probe into 5Dimes for money laundering.
Is 5Dimes Edging for a U.S. Entry?
The legacy of Creighton may live on with 5Dimes now having reached a settlement. The settlement effectively absolves it of any criminal conduct and allows the sportsbook to possibly seek a U.S. entry.
According to the settlement, Verela collaborated with the investigations from the start, and introduced significant changes to the 5Dimes business model. The settlement argued that the operator was no “suitable for participating in lawful gaming operations across the world.”
Maria M. Carrillo, assistant U.S. Attorney for the Eastern District of Pennsylvania, spoke to ESPN clarifying that Varela was in no conflict or violation of U.S. law, especially now that 5Dimes agreed to stop servicing U.S. customers.
Carrillo did clarify, though, that whether 5Dimes can transition to the legal sports betting market would be something that only regulators can decide. In a statement to ESPN, Varela said that she was excited about 5Dimes’ new chapter.