Wagering Insecurity: Organized Oversight Has Failed

This is Part 4 of the Thoroughbred Idea Foundation's (TIF) series “Wagering Insecurity.”

Faced with remarkable competitive pressure from the rise of legal sports betting, horse racing is at a crossroads.

Confidence amongst horseplayers and horse owners is essential to the future sustainability of the sport. Efforts to improve the greater North American Thoroughbred industry will fall flat if its stakeholders fail to secure a foundation of integrity, along with increased transparency of the wagering business and its participants over time. Achieving this is growing increasingly difficult after the sport has neglected its core base – horseplayers – for decades.

“Wagering Insecurity” details some of that neglect, and the need to embrace serious reform. Fortunately, there are examples across the racing world to follow.

PART 4 – CONFIDENCE

The Breeders' Cup Fix Six rocked North American racing.

In response, the National Thoroughbred Racing Association (NTRA) launched the Wagering Integrity Alliance and a separate entity, the Wagering Technology Working Group (WTWG).

In August 2003, a report published by the WTWG, in concert with the NTRA's security consultants, recommended three “primary measures”:

– Create the National Office of Wagering Security,

– Establish uniform, minimum security standards for wagering systems,

– Enhance the technology infrastructure of wagering systems to enable additional cyber-security measures.

The report was released in advance of that year's annual Jockey Club Round Table (full transcript).

Jim Quinn was the horseplayer representative in the WTWG that assembled the report and highlighted the interests of horseplayers emerging from the Fix Six:

“In regard to reform, what did the players want? Three things, primarily:

“One, the transmission of all wagering data from the simulcast outlets and hubs to the commingled pools should be state of the art, that is, as good as it gets.

“Two, as soon as possible, technology upgrades must be implemented, so that the late mergers of simulcast pools that cause the suspicious drops in the odds for unacceptably lengthy intervals after the horses have left the starting gates, would be eliminated, or effectively mitigated.

“Three, the players demanded to know, what is the scope of the problem, or how long has this been going on?”

Greg Avioli, then chief operating officer of the NTRA, recognized the need for a national response:

“A national office is our best means for detecting and responding to potential security threats across multiple jurisdictions or tote systems.”

Roger Licht, then chairman of the California Horse Racing Board, offered a regulatory perspective:

“Perception is often more important than reality. The perception is that people are betting after the commencement of a race.

“From what we have learned to date, that is not reality, but unless we upgrade our tote systems, we'll continue to have disgruntled horseplayers who feel that the odds on the winner – especially when we bet on him – are dropping after the commencement of a race.

“Let's change that perception – as fast as we can.”

Rudolph Giuliani, the former New York City mayor hired as an NTRA consultant through his firm Giuliani Partners, said:

“The idea of a wagering security office is very, very important.

“The only way in which you can assure yourselves and assure the public that there's a standard of integrity necessary for people to continue to invest in this sport in all different ways is to centralize the data and to have an office that focuses on accomplishing that mission and then making certain with tests along the way that integrity is maintained.”

Horseplayers in 2021 will be nodding their heads in agreement with all of these takes relative to betting on racing in North America 18 years after they were first shared. That should serve as a significant indictment.

Given the state of affairs at the time, the move to create the national office was met with optimism.

Horse racing's wagering business was changing. Bettors' perception was poor. The Fix Six scandal undermined confidence and discredited whatever controls the industry thought it had in place.

It did not go as planned.

ORGANIZED OVERSIGHT FAILED SLOWLY

Financial reports from the time show the NTRA spent almost $3 million on consultative work to form and launch the Wagering Integrity Alliance and a national office after the Fix Six through 2003.

Sharon O'Bryan, the initial Alliance director hired by the NTRA, turned-down the post one week before she was supposed to start. An interim director, Isidore Sobkowski, was hired a month later. But the project languished and NTRA annual reports from this period serve as reminders of the shifting interests of the time.

The Wagering Integrity Aliance became the National Office of Wagering Security but was soon rebranded as the Office of Racing Integrity (ORI). In its 2005 year-end publication, the NTRA indicated the ORI would be functional by the end of 2006.

In December 2005, Craig Fravel, then in the midst of a 20-year leadership role with Del Mar, highlighted the tough position of track operators being the only responsible entity for wagering integrity, with help from the shrinking TRPB.

After outlining a suspicious wagering outcome raised by a customer which he investigated with TRPB help, Fravel told an audience of industry professionals at the University of Arizona's symposium that self-oversight was not enough.

“I think to allow customers to have sufficient levels of confidence in us, we have to demonstrate that not only are we capable of reviewing things, but that there is a sufficiently independent and authoritative organization out there that can be the ultimate arbiter of those kind of decisions.

“And to a degree track management does have a vested interest in making sure that, [not only are we] at least portraying the game as on the up and up, but we are a little suspect simply because we are maybe overly confident at times, and I think the Breeders' Cup Pick-6 scandal was a classic case of that.

Craig Fravel - Alex Evers Photo.jpg
FORMER DEL MAR PRESIDENT CRAIG FRAVEL
PHOTO: ALEX EVERS

“I had said for years that, upon representations by various tote companies, there's no way anybody could get in and manipulate the mutuel pools.

“Well, in 2002 we found out that that was absolutely untrue and I had been told for years that there was no way that anybody could do past posting and found out about six months after that, that somebody was past posting in New York.”

Self-oversight remains the status quo and is insufficient for the modern gambling marketplace in 2021.

Despite the initial impetus to promote wagering security, the national initiative floundered.

After spending nearly $3 million in its first two years, NTRA outlays on wagering security initiatives dropped to just $1.1 million across 2004 and 2005 combined. The NTRA's five-year strategic plan for 2006-2010, published in June 2005, indicated the NTRA was budgeting $1 million annually for each of the next five years to support the Office of Racing Integrity. Instead, spending fell to just $28,531 in 2006 and $125,040 in 2007, about $1.8 million less than projected spending announced 18 months earlier.

The NTRA reported the ORI mission was to take “a lead role in the Wagering Transmission Protocol project to improve the technological infrastructure of the pari-mutuel wagering system.”

By 2008, ORI was gone and the hope of independent oversight of wagering was fading.

In December 2008, three executives from different spheres of the business addressed the topic of wagering security in Arizona. All three abandoned their work in racing soon thereafter.

Coming Tuesday, April 27 – Part 5 – Bingo

Miss a previous installment? Click on the links to read more.

Part 1 – Expectations

Part 2 – Intertwined

Part 3 – Volponi

Want to share your insights with TIF? Email us here.

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Horse-Handling Skills Helps Keep Equine Vets Safe

Being a large-animal veterinarian is fraught with danger—vets are often placed in precarious positions where they can be kicked, bitten or worse by the patients they're trying to help. It's estimated that about 80 percent of equine vets have suffered injuries from a difficult horse and 37 percent of those injured have had ongoing pain or a disability from the injury.

It's difficult enough to entice vet students to consider large animal practices; the risk of injury is just another strike against the profession. Gemma Pearson, Melanie Connor, John Keen, Richard Reardon, and Natalie Waran, all students at the University of Edinburgh's Royal (Dick) School of Veterinary Studies, are working to create a program to teach vet students horse-handling methods that are based on equine learning theory. It's hoped that this program will reduce the number of vets who don't consider large-animal work or who leave the profession early.

The research team tested the effects of a single lecture that focused on practical learning theory tips for equine vets on pre-final-year vet students. The 45-minute lecture focused on how horses learned; videos were shown that demonstrated how to apply that theory to equine patients.

Examples shown included overshadowing, where the horse is asked to do a task it knows (like stepping backward) to draw attention away from the action the vet is performing, like administering a shot. Using negative reinforcement to get a horse to enter stocks by lightly tapping him with a whip, and stopping as soon as he took a step forward was also included in the lecture .

Students watched videos of “difficult” horses both before and after the lecture; they were also asked questions. After the lecture, the students were more likely to suggest learning theory-based solutions on how to hand the horse. The vet students also indicated that they had greater confidence in their horse-handling skills after the lecture.

The study group concluded that just one lecture had the potential to positively alter students' perception of how to handle “difficult” horses; it may also influence how they deal with difficult horses, thus creating a safer work environment.

The researchers went on to note that horse owners play a key role in keeping vets safe; by teaching their horses to stand still unless asked to move, and to respond to leadrope cues to go forward or backward, they can help veterinarians remain safe on the job.

Read more at Horses and People.

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$107,000 Grant For Veteran-Focused Horses Helping Heroes Program

Polk County Conservation is pleased to announce that Jester Park Equestrian Center's (JPEC) Horses Helping Heroes program (H3) was awarded the US Department of Veteran's Affairs Adaptive Sports Program for Disabled Veterans and Disabled Members of the Armed Forces Grant in the amount of $107,000.

The Horses Helping Heroes program is an equine-assisted therapy program facilitated by Jester Park Equestrian Center in partnership with the Veterans Affairs Central Iowa Health Care System. The program's mission is to build a Veteran's confidence through a relationship with the horse by creating opportunities to develop skills that can be used in their daily life.

To date, the program has helped over 300 Veterans from the VA Domiciliary collaborate with horses to identify relationships, practice communication, manage challenges and recognize peace. This grant will help the Horses Helping Heroes program expand to meet the needs of the many Veterans who are outpatients in the region and is designed to address trauma and other mental health needs, including substance abuse, depression and improving family relationships.

VA Recreation Therapist Megan Trimble shared the following statement expressing her excitement. “We are so thankful for being considered and awarded this grant, giving us the opportunity to reach Veterans on an inpatient and outpatient basis. Past participating Veterans have shared a quote we use in the session that sums up the positive impact they have felt; 'There are things that the horse did for me that a human couldn't have done. – Buck Brannaman.' I cannot contain my excitement to be able to expand the JPEC partnership and the H3 program to outpatient Veterans and continue assisting them through an array of mental health challenges! I would like to express an insurmountable amount of thanks to everyone involved within the Horses Helping Heroes Equine Assisted Therapy program, to include Sierra and the whole Jester Park staff, VA staff, and all the volunteers and donors that keep this amazing program running.”

In closing, Equestrian Center Manager Claudia Starr adds, “We are so grateful to everyone who helped us secure this grant. There is nothing more gratifying than knowing the peace that our service men and women find through interacting with horses. Our EAGALA certified professional Sierra Carmichael, along with VA Recreational Therapist Megan Trimble and our equine therapists, are helping Veterans find positive ways to navigate the many challenges they face.”

Learn more about Jester Park Equestrian Center's Horses Helping Heroes program here.

Read more here.

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