California man gets 27 months for a $4M illegal offshore gambling and money laundering scheme

Jason Noah Feinman of Calabasas, California, was sentenced Tuesday to 27 months in federal prison after pleading guilty to operating an illegal offshore gambling business, laundering money, and evading taxes on more than $4 million, according to the US Department of Justice. For PSPs and acquiring teams, the useful bit is not the sentence itself; it is the familiar structure: offshore setup, unlicensed betting flow, cash-out via ordinary business accounts, and tax exposure on top.

1. Feinman ran a Costa Rica-based company that operated a website used by unlicensed gambling operators to facilitate illegal betting activity. Prosecutors said the platform let customers place wagers through websites maintained by Feinman, which violated state and federal laws.
2. Authorities said Feinman laundered proceeds from the gambling operation by converting cash into checks issued by one of his businesses. Between May 2018 and January 2024, he gave a customer more than $1.5 million in cash and received the same amount back through 18 checks. In total, officials said he exchanged between approximately $1.5 million and $3.5 million in cash for checks during the scheme.
3. The tax case ran alongside the gambling and laundering counts. Prosecutors said Feinman failed to pay taxes on income from the illegal gambling business between 2018 and 2022, and that he earned about $1.8 million in 2020 while reporting no taxable income on his federal return and paying no taxes that year. Authorities said he ultimately evaded taxes on approximately $4.2 million in income.
4. The investigation was handled by IRS Criminal Investigation and Homeland Security Investigations. Tax Division attorneys John C. Gerardi and Charles A. O’Reilly led the prosecution. In April, the Justice Department also announced the National Fraud Enforcement Division, a unit focused on fraud targeting Americans, as part of President Trump’s Task Force to Eliminate Fraud.
5. During the trial, Feinman pleaded guilty to one count each of tax evasion, operating an illegal gambling business, and money laundering. The case is a reminder that offshore gambling operations can create exposure not just on the gaming side, but on payment flows and tax treatment as well.