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Judge Deals Setback To Government's Case In Illegal Betting Ring Case

 An FBI and Nevada Gaming Commission raid on an alleged illegal online betting operation at Caesars Palace could be headed back to court.

Police arrested wealthy Malaysian businessman and high-stakes poker player Wei Seng "Paul" Phua, 50, his son, Wai Kit "Darren" Phua, 23, and six other people last summer.

Federal authorities believe Phua was moving an illegal Internet betting ring taking bets on the World Cup from Macau to villas at Caesars Palace. But, investigators couldn't get inside because of the high-level of security at Caesars Palace.

Federal prosecutors in Las Vegas believe Phua's operation handled about $13 million in illegal bets, before he and seven others were arrested.

The problem, is a federal judge ruled last week that evidence found during a July 9 raid by the FBI shouldn't be used against the defendants due to "false and misleading statements" and one "material omission" in the government's search warrant application.

U.S. Magistrate Judge Peggy Leen in Las Vegas wrote in report dated Jan. 30 the evidence was obtained through deception. FBI agents, in a first-of-its-kind ruse, disrupted Internet service during satellite feeds of World Cup soccer matches, then agents posed as repair technicians to get inside.

"It's now up to the government to make a decision on how they are going to proceed," David Chesnoff, an attorney representing Paul Phua, told KNPR's State of Nevada. "They can proceed with the limited evidence that got from other searches or they can drop the case or appeal the judge's decision. The ball is in their court at this time."

The parties have until Feb. 16 to file any objections to the judge's recommendations.


David Chesnoff, attorney and partner with Chesnoff & Schonfeld
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David Chesnoff, attorney and partner with Chesnoff & Schonfeld

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