In Wake of Betting Probe, Industry Prepares Strategy

In Wake of Betting Probe, Industry Prepares Strategy
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Regardless of the outcome of the probe into suspicious Breeders' Cup Ultra Pick Six wagers, the situation figures to trigger a review of how the pari-mutuel industry conducts its business. It also left National Thoroughbred Racing Association and Breeders' Cup officials to deal with public perception issues.

"This is going to get a thorough look," a top industry official said. "The net contribution to the whole thing is tote security. Will it be improved if it needs to be improved?"

NTRA commissioner Tim Smith and Breeders' Cup president D.G. Van Clief Jr. scheduled a teleconference for 3 p.m. EST Nov. 1 to discuss an industry initiative, perhaps an NTRA/Breeders' Cup task force, to deal with the situation. Details were not immediately available.

In 2000, the NTRA was negotiating with IBM Global Services on a broad technology venture largely tied to the acquisition or building of a tote system for the industry. Though the $100-million to $200-million proposal was linked more with streamlining and marketing to increase handle, there would have been other benefits, namely an upgrade of tote technology.

The proposal also called for the NTRA to operate a tote subsidiary, which led some NTRA members to say the NTRA would end up competing with its dues-paying members. The project was shelved in late 2000, primarily because of cost and complaints from members, so The Jockey Club began to examine the role it could play in a technology upgrade.

That continues today. Alan Marzelli, who will take over as president of The Jockey Club Jan. 1, 2003, said three of four action items have been addressed since an announcement made in October 2000: an enhanced Web presence and database marketing for the NTRA, enhanced communications within the industry, and integration of race-related information and financial transactions into a central database. The one item not addressed is centralization and upgrade of tote software platforms.

Marzelli said though the IBM project was "too ambitious," the centralization and upgrade of tote software platforms is a legitimate goal.

"Nothing changed the fact in my mind that the totes were undercapitalized," Marzelli said. "If that has anything to do with the situation today, it may be revealed when the investigation is complete."

Though not directly tied to tote integrity, comments made by IBM Global Services general manager Mark Elliott in 2000 indicated the Thoroughbred industry has some work to do. "I don't want to be overly abusive," he said. "But as an industry, you are as far behind in the use of technology to improve your business than any I have ever seen."

NTRA officials would not comment publicly on what they believe needs to be done to perhaps streamline the process. They did say public protection is paramount.

The case of the questionable Pick Six has drawn attention from outside the pari-mutuel industry. Investigative reporters with major newspapers are among those looking into the situation and the background.

The potential for the spread of misinformation and speculation the Breeders' Cup races themselves were fixed is a concern because, in the words of one official, "there are people who don't know a Pick Six from a six-pack." There is a damage-control plan for such situations, but NTRA officials would not discuss specifics.

"We're going to have to be vigilant," the official said, "because these things can take a life of their own in the media."

Indeed, a headline in the Oct. 28 edition of the Washington Post called the Pick Six a "Fix Six" even though it had not been determined the bet was bogus. The Post is considered one of the top newspapers in the country.

"We don't want anyone to overreact," said Chip Tuttle, a partner in Conover Tuttle, the Massachusetts advertising agency that is handling some public relations work for Breeders' Cup. "It's not like the outcome of races was manipulated, or there is rampant manipulation of wagering data."

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