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  #1 (permalink)  
Old 08-15-2003, 10:17 PM
gradysfalcon gradysfalcon is offline
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Default Investigation taking toll on North Dakota betting service

An ongoing investigation into the tax practices of Fargo-based off-track betting company Racing Services Inc. has resulted in a dramatic drop in wagering in the state for the company.
Total race wagers for the week ending August 3 came in at $650,408, a startling drop for the all-time state high of $10.25-million that was wagered during the final week of May, Fargo-Moorhead's The Forum reports.

The wagering figures have been in a steady decline since news of the investigation became public on July 3 after the North Dakota Racing Commission demanded that Racing Services Inc. get caught up on the special tax funds it owes the commission.

The commission told Racing Services on July 2 that it must pay February, March, and April taxes by Friday after the company already missed deadlines for May and June taxes. The Bismark newspaper has reported that Racing Services could owe the state approximately $5.5-million in back taxes.

After recording handle of $8.43-million for the week ending June 29, the companyís figure fell to $4.38-million for the week ending July 6 and has continued to plummet ever since.

Ken Maloney, who recently took over as president and chief operating officer for Racing Services, said that while the decline in handle comes as a significant blow to the company, it is not a shock.

"The North Dakota handle has dropped drastically because of all this media," Maloney said, adding that news reporters are only doing their jobs. "Weíre taken a 90% drop in handle."

Maloney added that former president Susan Bala was currently out of state trying to drum up new business for the company.

"Thatís her strength, the sales side of the business, and thatís what sheís doing right now," Maloney said. "And Iím working on a payment plan for the state."

Racing Services, which owns the only license to conduct simulcast wagering in North Dakota, operates four OTBs in Fargo and additional sites in South Dakota, Nebraska, Idaho, and Oregon. In 2001, the company allowed one of its major clients a direct computer link to its totalizator service, drawing criticism from racing officials around the nation and prompting an investigation by the North Dakota Racing Commission.

The commission is set to meet on August 20 and a discussion of Racing Services license is expected.

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Old 08-15-2003, 10:36 PM
Holy Bull Holy Bull is offline
Join Date: Feb 2002
Posts: 2,740

Looks like they are calling the states bluff [img]i/expressions/face-icon-small-smile.gif[/img]
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Old 08-18-2003, 03:16 PM
maria sharapova maria sharapova is offline
Join Date: Aug 2002
Posts: 121

a further indication that this company is
basically owned -- except in writing--by this one
whale fellow.
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Old 08-18-2003, 11:02 PM
niltes niltes is offline
Join Date: Dec 2001
Posts: 1,015

referring to the alledged owner as a whale fellow would imply he'a fish which i think is hardly the case.
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Old 08-19-2003, 12:02 AM
The Actuary The Actuary is offline
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ANy publicly held companies going to benefit or suffer enough to matter because of this?
In 1998 the Department of Justice brought charges under the Wire Act against 22 American citizens involved in managing foreign-based sites. "You canít hide online," Janet Reno, the attorney-general, warned Internet betting operators, "and you canít hide offshore."
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Old 08-21-2003, 08:50 PM
gradysfalcon gradysfalcon is offline
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Posted on Thu, Aug. 21, 2003

Back taxes haunt Fargo horse-betting company
By James MacPherson
Associated Press

BISMARCK - A Fargo-based horse-betting company wants to set up an installment plan to repay $6.5 million in overdue taxes, but Attorney General Wayne Stenehjem says the state wants its money now.

Racing Services Inc., the state's only licensed simulcast operator for horse betting, underreported wagers from Oct. 1, 2002, through April 30 by $98.9 million.

Stenehjem told the North Dakota Racing Commission on Wednesday he would meet privately with Racing Services officials to discuss the back tax.

Later, Stenehjem said he made an offer to the company, which has until today to accept it.

Stenehjem declined to give specifics on the proposal.

"The public interest demands a quick resolution to this matter," Stenehjem said.

In a prepared statement, Chief Executive Officer Susan Bala said her company will repay the state, but it needs time.

Racing Services is under investigation by state and federal authorities. The company provides 10 sites for bettors to watch and wager on out-of-state horse racing.

U.S. Attorney Drew Wrigley said a federal criminal investigation is ongoing, with agents from both the FBI and IRS involved.

Wrigley said he could not talk about the investigation, or why the near $99 million was not reported by the company.

The company made a $1.4 million payment to the state last week, and $254,000 payment Wednesday.

Taxes from horse betting go to the state's general fund and to the Racing Commission.

Stenehjem said the recent payments "do not justify the failure of the amount due."

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Old 08-22-2003, 06:51 AM
Inside The Pylons Inside The Pylons is offline
Join Date: Nov 2002
Posts: 3,418

This is actually fvcking hilarious if you have an understanding of what is going on here and what they think will happen.[img]i/expressions/face-icon-small-shocked.gif[/img]

Posted: 8/21/2003 6:47:00 PM ET

North Dakota to assume management of Racing Services

Susan Bala, owner and president of Racing Services Inc. in Fargo, North Dakota, has reached an agreement with the stateís attorney general office to turn the management of the pari-mutuel wagering company over to a state-appointed receiver that will manage the company.
North Dakota Attorney General Wayne Stenehjem announced the arrangement during a teleconference on Thursday afternoon. Bala will retain ownership of Racing Services but will not involve herself in the day-to-day operations of the company, and state bankruptcy trustee Wayne Derwes will act as receiver of Racing Services.

"The state sought appointment of a receiver to seek management of [Racing Services] because of past due taxes and the negative publicity surrounding the corporation because of both the state and federal investigations," Stenehjem said.

Racing Services owes North Dakota approximately $6.5-million in back taxes, Stenehjem said earlier this year. When Bala told him that Racing Services could not afford to pay the amount upfront, Stenehjem rejected her proposal to pay the money back on a payment plan, recommending the receivership instead.

Bala and Stenehjem met Wednesday when the attorney general told Bala that he would not seek the revocation of Racing Servicesís license if she agreed to voluntarily give up her management position in the company.

Stenehjem said that Bala considered his proposal overnight and agreed to the terms on Thursday.

A North Dakota judge appointed Derwes to the receivership position on Thursday afternoon under the recommendation of Stenehjem and Special Assistant Attorney General Robert Minch.

"[Derwes] will continue operation of business and acquire income to meet all financial obligations in coming months," Stenehjem said. "This is the best opportunity for the state of North Dakota to collect the money its owed and continue to receive taxes."

Stenehjem said that he hopes this arrangement will entice one of North Dakotaís biggest bettors in recent years to return wagering through Racing Services.

Stenehjem said that one of the reasons the individual stopped using the service was because of integrity issues surrounding the operation. Stenehjem confirmed that his office was in talks with the gamblerís business manager in California and Fargo-based attorney.

All employees of Racing Services except Bala will retain their jobs under the agreement, which Stenehjem said would last until the companyís finances are in order.

"Itís not permanent, but it is indefinite," Stenehjem said.óEd DeRosa

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Old 08-23-2003, 07:54 PM
maria sharapova maria sharapova is offline
Join Date: Aug 2002
Posts: 121

another article from the crack journos at drf we still can't mention his name
american race wagering regulations sure are quite diverse.

Fbi & Irs investigations still ongoing.probably the usual
tax fraud, money laundering etc.
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