A federal grand jury indictment was unsealed Friday in Alabama, charging eleven defendants from across the United States in a multi-million dollar wagering excise tax evasion scheme.
A 114-count indictment filed in U.S. District Court charges the defendants stemming from their management of a multi-million dollar wagering excise tax evasion scheme involving an illegal sports-betting organization.
Below are the accused:
- Timothy J. Pughsley, 51, of Birmingham, Alabama, is charged with 38 counts of tax evasion, one count of conspiring to operate an illegal sports-betting organization, one count of conspiring to commit money laundering, and four counts of money laundering.
- Christopher Burdette, 30, of Chelsea, Alabama, is charged with six counts of tax evasion, one count of conspiring to operate an illegal sports-betting organization, one count of conspiring to commit money laundering, and one count of money laundering.
- Nathanael Burdette, 36, of Birmingham, Alabama, is charged with six counts of tax evasion, one count of conspiring to operate an illegal sports-betting organization, one count of conspiring to commit money laundering, and two counts of money laundering.
- Jonathan Lind, 44, of Birmingham, Alabama, is charged with six counts of tax evasion, one count of conspiring to operate an illegal sports-betting organization, one count of conspiring to commit money laundering, and two counts of money laundering.
- Thomas V. Zito, 57, of Vestavia, Alabama, is charged with six counts of tax evasion, one count of conspiring to operate an illegal sports-betting organization, one count of conspiring to commit money laundering, and one count of money laundering.
- Christopher Donaldson, 46, of Trussville, Alabama, is charged with one count of conspiring to operate an illegal sport-betting organization and one count of conspiring to commit money laundering.
- Gary L. Rapp, Jr., 44, of Lakeland, Tennessee, is charged with six counts of tax evasion, one count of conspiring to operate an illegal sports-betting organization, one count of conspiring to commit money laundering, and two counts of money laundering.
- Mark Giaquinto, 50, of Upton, Massachusetts, is charged with six counts of tax evasion, one count of conspiring to operate an illegal sports-betting organization, one count of conspiring to commit money laundering, and two counts of money laundering.
- Matthew D. Voorhees, 47, of Englewood, Colorado, is charged with six counts of tax evasion, one count of conspiring to operate an illegal sports-betting organization, one count of conspiring to commit money laundering, and two counts of money laundering.
- David Richards, 38, of Las Vegas, Nevada, is charged with six counts of tax evasion, one count of conspiring to operate an illegal sports-betting organization, one count of conspiring to commit money laundering, and two counts of money laundering.
- Joshua Gentrup, 36, of Athens, Georgia, is charged with six counts of tax evasion, one count of conspiring to operate an illegal sports-betting organization, one count of conspiring to commit money laundering, and two counts of money laundering.
According to the indictment, Pughsley began operating a bookmaking business at least 17 years ago. The organization eventually became known as “Red44,” and bookmaking and betting activities occurred online via an offshore server located in Costa Rica. Defendants named within the indictment are alleged to be senior agents in the Red44 organization or original founding members.
Regarding the tax counts against the defendants, the indictment alleges that the organization was estimated to have accepted hundreds of millions of dollars in wagers from bettors from 2019 through 2021.
In 2019, the Red44 Organization was alleged to have earned a gross profit of $14,930,787.00. The excise tax owed to the Internal Revenue Service, or two percent of total wagers placed by bettors, would be $6,882,460.46 for 2019 alone.
In 2020, the organization had an income of approximately $24 million. The excise tax owed to the IRS for this year would total approximately $6 million. Further, in 2021, the organization had an income of approximately $36 million. The excise tax owed to the IRS for 2020 would total over $7 million.
