The crack down on internet gaming in the US has shaken the industry

Betonsports said the decision to end David Carruthers' contract was "as a consequence of (his) continued detention by US authorities."

He was arrested last week as part of a US move to tackle internet gaming.

The 48-year-old is in a Missouri prison after earlier waiving his right to a bail hearing.

Betonsports said: "Clearly while he remains in the custody of the US government he is unable to perform his duties."

It added it had been unable to speak directly with Mr Carruthers, who was named along with 11 other people and three other companies in a Federal indictment.

A warrant also has been issued for the arrest of Betonsports founder Gary Stephen Kaplan, 47, who is charged with 20 offences including tax evasion and conspiracy.

On Tuesday Betonsports, which has temporarily closed its website, distanced itself from Mr Kaplan - saying that he has no managerial role with the firm and worked only as a consultant.

Legal concerns

Online gambling has been somewhat of a grey area in the US.

Gambling is illegal in many parts of the US, but internet gaming firms have hundreds of thousands of US customers as they are based offshore in countries that allow gambling and so were viewed as out of reach of US laws.

However, the US government believes internet gambling violates a law against placing interstate bets using telephone lines.

Betonsports estimates it has 1.2 million online gamblers worldwide, and says the US online gaming market is worth $12bn (�6.4bn) in annual business.

Many observers now expect the US to continue in its crackdown and some are even predicting that there may be growing support for an anti-gaming bill.

Mr Carruthers has been an outspoken opponent of US moves aimed at banning banks and credit card companies from processing internet gambling payments.