A California resident has been handed a 27-month federal prison sentence after operating an unlicensed offshore gambling enterprise that pulled in over $4 million, federal prosecutors confirmed this week. Jason Noah Feinman from Calabasas ran the operation through a Costa Rica-based company and faces convictions for money laundering and tax evasion alongside the gambling charges.

How the Scheme Operated

Feinman’s setup was straightforward in its illegality. He maintained websites used by unlicensed operators to take customer bets, sidestepping state and federal regulations entirely. Between May 2018 and January 2024, he facilitated the operation and worked to obscure its income.

Here’s where it gets interesting from an enforcement angle: the money laundering. Rather than moving funds through traditional banking channels that might trigger alerts, Feinman converted cash into cheques issued by his own businesses. In one stretch, he exchanged over $1.5 million in cash for cheques with a single customer through 18 separate transactions. Across the full scheme, he cycled between $1.5 million and $3.5 million this way.

Tax Evasion Adds Weight to Charges

The tax side tells its own story about the operation’s scale. In 2020 alone, Feinman earned roughly $1.8 million from the illegal gambling business but reported zero taxable income on his federal return and paid nothing. Over the four-year period investigated, he evaded taxes on approximately $4.2 million in income.

The IRS Criminal Investigation unit and Homeland Security Investigations handled the probe, with Tax Division prosecutors John C. Gerardi and Charles A. O’Reilley leading the case. Feinman pleaded guilty to one count each of tax evasion, operating an illegal gambling business, and money laundering.

Broader Enforcement Push

This case sits within a wider federal enforcement effort. The Justice Department created the National Fraud Enforcement Division earlier this year to tackle fraud schemes systematically. And it shows something important: offshore gambling operations aren’t isolated ventures. They typically run alongside real financial crimes.