07/14/2005 11:00PM

Bala gets 27-month sentence


Susan Bala, the founder and chief executive officer of the now defunct Racing Services Inc. in North Dakota, was sentenced on Thursday to 27 months in federal prison and two years of probation for conducting an illegal gambling business.

Bala was sentenced by U.S. District Judge Ralph Erickson in a courtroom in Fargo, N.D., where Racing Services was based. Bala was convicted Feb. 12 on 12 counts, including conducting an illegal gambling business, conspiracy to conduct an illegal gambling business, illegal wire transfer, and nine counts of money laundering.

According to the Associated Press, Bala told Erickson at the sentencing hearing that she did not intentionally break any law. "In my heart, I would never do anything illegal," Bala said, according to the AP.

Racing Services Inc., which Bala founded in 1990, became one of the most high-profile offtrack betting companies in the U.S. in the 2000's because of its recruitment of heavy bettors by offering rebates on its handle. In 2002, the company took in bets of $220 million through 10 sites in the sparsely populated state - $160 million of that total came from one bettor.

The state attorney general seized Racing Services and barred Bala from the company in late 2003 after alleging that the company failed to pay taxes of $6.5 million on handle of $98.5 million that was not reported to the state. Prosecutors later alleged that the bets were taken at an unlicensed site in Fargo.

After Bala's conviction in February, the jury ordered Racing Services to forfeit $99 million. Bala was ordered to pay $19.7 million of the total.