First, federal prosecutors heavy-handed tactics generated a political firestorm with one of America’s closest allies over the NatWest Three case. Now this:

In a sharp escalation of their crackdown on Internet gambling, United States prosecutors said yesterday that they were pressing charges against the chief executive of BetOnSports, a prominent Internet gambling company that is publicly traded in Britain, and against several other current and former company officers.
Federal authorities arrested the chief executive, David Carruthers, late Sunday as he was on layover at Dallas-Fort Worth International Airport on his way from Britain to Costa Rica. In a hearing yesterday in Federal District Court in Fort Worth, he was charged with racketeering conspiracy for participating in an illegal gambling enterprise.

Let me get this straight. Carruthers is a UK citizen, legally runs a UK-based company with a UK-based website, and he gets arrested in the US because US citizens are gambling on his website?
Here’s hoping that the UK raises hell with the Bush Administration over this latest incident as well as the handling of the NatWest Three case (which, by the way, has not generated even a civil case in the UK, much less a criminal one). As Larry Ribstein has pointed out on many occasions, the remedy of granting federal prosecutors broad latitude to criminalize business interests is generating a wave of prosecutorial abuse that is far more troubling than the original “problem” that the remedy is supposed to address. Christine Hurt has more.