DOJ’s New Fraud Division Shuts Down Offshore Sportsbook Operator: California Man Sentenced to 27 Months

The U.S. Department of Justice’s newly established National Fraud Enforcement Division has secured its first major victory by dismantling an illegal offshore sports betting operation. Jason Noah Feinman, a California resident, was sentenced to 27 months in federal prison and ordered to forfeit $3 million after admitting to operating an unlicensed sportsbook platform from Costa Rica while evading taxes and laundering gambling proceeds.

Feinman, 52, pleaded guilty to tax evasion, operating an illegal gambling business, and money laundering. Prosecutors revealed that Feinman ran an online sports betting service from 2015 to May 2024, facilitating bets for unlicensed bookmakers in the U.S. and Costa Rica. Despite generating over $4.2 million in income, he reported $0 in federal taxes for the years 2018 through 2022, even claiming a $75,503 tax refund in 2020.

The operation involved Costa Rican associates who laundered gambling proceeds for Feinman in exchange for a cut of the profits. Between 2018 and 2024, one associate, identified only as C.K., provided Feinman with 18 checks, including one for $200,000, in exchange for $1.5 million in cash. The checks often referenced loans to obscure the true nature of the transactions.

In a court statement, Feinman acknowledged his guilt, saying: “I am pleading guilty because I am guilty of the charges.” His sentence reflects a reduced term from the potential 3.5 to five years he faced, thanks to his cooperation with prosecutors.

The case highlights the DOJ’s intensified focus on combating illegal offshore gambling operations, particularly those exploiting jurisdictions like Costa Rica, which lacks a gaming regulatory authority. This victory signals the DOJ’s commitment to dismantling fraudulent betting platforms that undermine legal markets and evade tax obligations.