10/21/2007 11:00PM

Oregon may suspend rebate shop

EmailThe Oregon Racing Commission has put the offshore rebate shop International Racing Group under notice that its wagering license will be suspended unless the shop addresses problems related to an ongoing investigation by U.S. Immigration and Customs Enforcement.

The commission issued the notice late on Friday after a teleconference call. Randy Evers, the executive director of the Oregon Racing Commission, said on Monday that he could not comment directly on the order but said that the commission's concerns related to the ability of IRG customers to withdraw money from their accounts, a requirement for licensing under Oregon law.

IRG, which is owned by Youbet.com, a publicly traded company, was served with a search warrant on Oct. 4 by investigators with the U.S. customs agency on Oct. 4. According to Youbet, the investigators seized records related to several IRG customers and $1.5 million in three bank accounts maintained by IRG in Nevada for its U.S. customers.

On Monday, Hud Englehart, a spokesman for Youbet, said that IRG customers are not currently able to deposit or withdraw money from their accounts because the seizure by U.S. customs had forced those accounts to be closed.

Englehart said that Youbet is working with federal banking authorities to re-establish the accounts, but he said that the approvals would "take some time." In the meantime, current customers are still being allowed to bet on races, Englehart said.

Under Oregon racing law, Youbet has 21 days to appeal formally the notice to suspend IRG's license, at which point the appeal would be heard by an administrative law judge. The notice to suspend, however, could be rescinded before the administrative hearing if the company has addressed the commission's concerns.

Last week, Breeders' Cup Ltd. denied IRG a simulcasting contract for this week's Breeders' Cup event at Monmouth Park because of the ongoing investigation. IRG had come under scrutiny in 2004 when federal investigators charged 17 people with operating an illegal gambling business through several offshore rebate shops, including IRG, which was never charged with a crime.