Minor leaguer ran the Major League sports betting business
April 2, 2022
Federal officials announced a series of cases emanating from an illegal gambling operation involving current and past professional players, some of whom helped the enterprise and others who gambled huge sums on games.
The principals of the organization decided to plead guilty to conspiracy charges and admitted to taking in millions of dollars in bets, many of which were enabled through a Costa Rica-based gambling website, according to records unsealed Wednesday in the United States District Court. One of the scheme's organizers also admitted to failing to declare roughly $1.5 million in gambling-related revenue to the IRS over a two-year period.
The proprietor of the online gambling business and website pled guilty earlier this month, admitting that the operation was illegal under California law since it employed at least five individuals, lasted at least six years, and frequently generated gross revenue of more than $2,000 per day.
Four new cases with linked plea deals were revealed against:
- Wayne Nix, 45, of Newport Coast, was charged with one count of conspiring to conduct an unlawful sports gambling company and one count of submitting a fraudulent tax return.
- Nix's longstanding partner in the company, Edon Kagasoff, 44, of Lake Forest, was charged with one count of conspiracy to conduct an unlawful sports gambling business.
- Howard Miller, 63, of Gardena, was charged with one count of aiding and abetting the operation of an illegal sports gambling business by assisting in the collection and payout of gambling proceeds related to the Costa Rica-based website;
- Celebrity Financial LLC, dba Sherman Oaks Check Cashing, was charged with failing to maintain an effective money laundering program in connection with its cashing at least $18 million in checks from the illegal sports gambling business.
Cases against two other individuals earlier this month
Kenneth Arsenian, 52, of Newport Beach, pleaded guilty to four charges on January 26: operating an illegal sports gambling business, filing a false tax return, money laundering, and accepting a financial instrument for unlawful internet gambling;
Joseph Castelao, 56, of Rancho Palos Verdes, the owner of the gambling website – Sand Island Sports – pleaded guilty to operating an illegal gambling business on March 15.
Nix started a bookmaking business approximately 20 years ago, according to court documents made public this week. Nix built a customer list of current and former professional athletes through his relationships in the sports world, and he hired three former Major League Baseball players to help with the firm.
With respect to the tax charge, Nix admitted to collecting $1,466,947 in income that he failed to record on his federal income tax returns for the years 2017 and 2018. Nix agreed to pay all back taxes due for those years — a total of $1,248,429, which includes back taxes, penalties, and interest – as part of his plea agreement. Nix also consented to hand over approximately $1.3 million to the authorities, which was confiscated from two bank accounts and two brokerage accounts he controlled in February 2020.
The investigation is being conducted by Homeland Security Investigations (HSI) and IRS Criminal Investigation. The El Camino Real Financial Crimes Task Force includes HSI agents. These cases are being prosecuted by Assistant United States Attorneys Jeff Mitchell of the Major Frauds Section and Dan Boyle of the Asset Forfeiture Section.