Cantor Fitzgerald Subsidiary to Pay $22.5 Million to Settle Illegal Gambling Probe

A branch of Cantor Fitzgerald, a well-known finance company that entered the realm of sports wagering, has consented to a $22.5 million payment to settle a probe into its prior participation in illicit gambling and money cleansing. This development, revealed by officials on Monday, arrives three years following a former leader at the branch admitting guilt to conspiracy accusations connected to the unlawful betting ring.

Federal legal representatives declared that CG Technology LP, previously called Cantor Gaming, agreed to a $16.5 million fine as part of a deferred prosecution arrangement. Furthermore, the Financial Crimes Enforcement Network (FinCEN) levied a $12 million civil fine against CG Technology, with $6 million of that sum being encompassed by the criminal resolution.

Cantor Fitzgerald has disassociated itself from the branch since 2014, asserting no ownership interest. Nevertheless, it’s crucial to recognize that the branch had become a significant participant in the American sports betting sector.

Brooklyn US Attorney Robert Capers stressed that this expansion, attained by disregarding legal adherence, was intolerable. He affirmed that Cantor’s gaming offshoot essentially transformed into a center for a minimum of two extensive illicit wagering enterprises to sanitize their earnings.

CG Technology operated sportsbooks in seven prominent Las Vegas casinos, encompassing renowned establishments like the Cosmopolitan, the Hard Rock Hotel and Casino, and the Venetian.

American legal officials claimed that a branch of Cantor Gaming not only provided special treatment for significant gamblers but also manipulated regulations to handle their substantial wagers. This involved granting these VIPs a direct connection to Michael Colbert, the firm’s Head of Risk Management, who possessed the power to personally modify wagering restrictions and odds.

Colbert deliberately managed enormous monetary exchanges, ignoring the illicit sources of the money. The ex-Cantor executive and his staff also enabled third-party electronic transfers and permitted representatives to place wagers or participate in “proxy betting” – actions strictly forbidden under Nevada regulations.

CG Technology confessed to breaching federal law, promising to collaborate with authorities and execute changes to guarantee future adherence.

In August 2013, Colbert admitted guilt to conspiring to manage an unlawful gambling enterprise and risked a maximum penalty of five years imprisonment.

The controversy also resulted in Cantor Gaming consenting to a $5.5 million resolution in 2014 with the Nevada Gaming Control Board, who had lodged a grievance regarding the illicit actions.

Chief Executive Lee Amaitis stepped down in August of that year after CG Technology agreed to pay an additional $1.5 million to settle a separate matter with Nevada authorities. This case involved problems with the company’s digital system that led to incorrect disbursements to patrons.