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December-23-2007,
Encores of Familiar Horse Racing Refrains Part II...By Nelson Lardner

In our earlier presentation, we touched upon recent disconcerting incidents occurring within the horse racing industry involving direct equine tampering (the "sponging" of a horse at Delaware Park, which apparently affected the breathing of a 4-5 shot sufficiently to cause a weak third-place finish in a five-horse field)and extreme-advantage wagering (during an annual industry symposium, a Kentucky-based player testified that he was able to make multiple bets at Keeneland on a New Orleans Fair Grounds race, several seconds AFTER the start).

Both incidents could conceivably be part of "bigger deals", if they're shown to be part of a broader pattern of behavior. But as noted in Part I, a sustained rash of "sponging" incidents hasn't been uncovered for more than a decade, and delayed locking of mutuel machines subsequent to a race's start happens occasionally, but does not appear to be a habitual industry flaw.

But then, there's the big one . . . still cause for concern . . . even with the acquittal handed down by Old Bailey Justice Thane Forbes. Champion jockey Kieren Fallon, brought to trial among others in connection with a bizarre series of 27 races held between December, 2002 and August, 2004, was cleared of race-fixing charges in London earlier this month at the conclusion of the two month trial, which caused a sensation "over there".

The prosecution couldn't connect Fallon with the fire, despite the fact there was considerable smoke . . . notably the substantial sums risked on the betting exchange Betfair against a significant number of Fallon's mounts in the names of certain closely connected individuals.

But of the seventeen horses Fallon rode which were allegedly part and parcel of the scheme during the time period specified, he finished first on five of them. . . and that fact - in conjunction with the sustained, steadfast denials of wrongdoing by all named -- made a conviction a remote reach, and in the end, it was not to be, thus thwarting a prosecution which is believed to have cost all involved some three million pounds, in toto.

As one Fallon representative put it, "There is simply no case to answer. None of the strands of evidence individually or collectively amount to a case to answer." Can't argue that. But when the gentleman in question (John Kelsey-Fry) followed up with, "The evidence presented by the prosecution when properly analyzed has demonstrated that Kieren Fallon was not a party to a conspiracy to defraud," this typist is personally not convinced to go along with that part of it, given the broad evidence of heavy play from the same handful of sources against heavily backed animals - over 70% of which didn't win.

Professional gambler Miles Rodgers became a focus of Betfair's attention in December, 2002, when Rodgers allegedly made a 70,000-plus-pounds lay against the horse Legal Set (owned by a Rodgers-controlled syndicate) in Betfair accounts Rogers controlled. Ridden by Darren Williams, another of the defendants in the Fallon case, Legal Set lost. But the incident clearly set inquiring minds on a certain course, for as Betfair lawyer David O'Reilly has noted on the record, the English Jockey Club (British racing's ruling body) threw Rodgers' name out there during subsequent discourse with Betfair personnel, and betting-exchange representatives acknowledged that Rodgers was a "person of concern". And away we went.

There hasn't been a sustained airing of a race-fixing investigation in North America since the late 70's, when Tony Ciulla turned government witness in a sustained investigation largely focused on the sport in the Northeast. You need multiple insiders to lose their nerve in any conspiracy case to make it stick, and it's difficult to induce that when defendants and lawyers all know that if everyone keeps their wits about them and sustains steadfast public denial, the prosecution's behind the eight ball.

Jawboning goes on and on about the integrity of the mutuels system, especially since those clever Drexel fraternity mates hit the jackpot by gaming the computer system in the 2002 Breeders' Cup Pick Six. But of greater current day-to-day importance is the optimal interval between the closing of betting on a specific race, and the event's start. The tracks and the simulcast parlors want "just in time" interval management, to maximize handle (and thereby, revenue). Many players find this odious, for multiple reasons, including (a) the associated inability of players to see final odds prior to the break, injuring confidence in the game when horses subject to steep odds declines after the start win easily, and (b) the advantage sophisticated system bettors blessed with state-of-the-art computer programs enjoy, when able to feed in multiple exotic-pools wagers at advantageous odds during the final seconds of wagering. To their credit, a number of tracks have bitten the bullet and no longer facilitate such custom, citing the sustained disadvantage the conventional on-track player endures, due to the practice. The different levels of access create an uneven playing field, and we're grateful that some tracks have displayed such sensitivity.

But wheeling back to the Delaware sponging incident, we'll cap today's presentation with another security story. Arguably the most renowned racetrack in the world, Louisville's Churchill Downs, sliced 34 dedicated security jobs off its in-house payroll, shifting the burden to contract service rent-a-cops performing for Brantley Security Services, long the supplier of Churchill's ushers.

The hue and cry of Churchill's horsemen when this came to light was ignored, as Downs management went on their merry way, the obligation to fund benefit packages for a loyal home-based security force receding in the rearview mirror.

Churchill's conduct, in the light of the munificent tax breaks the corporation received during the recent property renovation, for which costs ran into the low nine figures, hardly befits an operation for whom a dedicated security force eager to keep bad guys with sponges (among other nefarious tampering tools) away from the barn areas would seem a priority.

But, hey, Churchill's stock price is up, up and away. Place your bets.

But caveat emptor.

12-22-07
NelsonLardner
MajorWager.com
lardner@majorwager.com

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