TOC Takes Stand on Auction Reform
by Tom LaMarra
Date Posted: 1/19/2008 10:13:06 AM
Last Updated: 1/19/2008 5:10:50 PM

The Thoroughbred Owners of California would like to see national auction reform efforts taken to another level.

The TOC released recommendations Jan. 18 that call for a ban on anabolic steroids in all sale horses, full disclosure of ownership and medical records, and the licensing of bloodstock consignors and agents. The recommendations, which stem from a report by the TOC Medication and Integrity Committee, were endorsed by the TOC board of directors in December.

The recommendations suggest taking existing efforts around the country much further. The TOC said self-regulation policies adopted by the national Sales Integrity Task Force don't go far enough and have sent letters expressing their views to sale companies and the task force.

The TOC said its committee "undertook an assessment of existing practices before developing its recommendations, which aim to enhance the integrity and competitiveness of auction sales, from the purchaser's point of view, and to improve the overall health of the business."

As a condition of sale, the TOC supports a ban on the use of exogenous anabolic steroids in all horses within 45 days of a sale. (Currently, only the Ocala Breeders' Sales Co. plans to offer voluntary testing for 2-year-olds in 2008.) The ban includes the administration of naturally occurring anabolic steroids resulting in abnormal levels, and all exogenous anabolic steroids.

"The use of anabolic steroids can affect a horse's natural appearance and/or ability, which may or may not translate into racing performance," TOC chair Marsha Naify said in a statement. "Ultimately, this puts the buyer at a disadvantage and undermines the integrity of the sales transaction."

The TOC supports full mandatory disclosure of ownership details as well as a policy that any change in ownership, immediately prior to the sale of the horse, must be fully disclosed. "A voluntary policy simply is not enough," Naify said. "Consequently, a mandatory disclosure policy is required to address questionable bidding tactics that artificially inflate sales values and undermine the integrity of auctions."

The TOC also supports full disclosure of medical procedures and surgeries performed on any horse entered in a sale. It suggests that, when possible, full medical records should be made available to prospective buyers.

Consignors should be asked to disclose details on any corrective surgeries or other significant medical treatments or procedures performed on young horses, as well as any medical records, to prospective buyers, the TOC said.

Finally, the TOC supports the licensing of bloodstock consignors and agents and intends to pursue the regulatory changes necessary to license consignors with the California Horse Racing Board. Agents are licensed in California but not in many other states.

The Sales Integrity Task Force last year suggested such licensing could negatively impact foreign participation at auctions, but the TOC said "bloodstock consignors are responsible for facilitating transactions involving hundreds of millions of dollars annually, yet they are essentially unregulated brokers."

Naify said the CHRB licenses 26,000 people in 26 categories. "Why should consignors be excluded?" she said. "TOC believes that an essential step to improving the integrity of auction sales — and to attracting new buyers — is the elimination of any appearance of fraud or deceit. We are fully in favor of complete transparency in the marketplace."

The TOC said efforts by sale companies to offer tests for steroids in weanlings and yearlings this year are laudable but not enough. The organization also said the Sales Integrity Task Force recommendations "fall short of what is needed to address the legitimate interests and concerns of Thoroughbred owners who buy at auction sales. The lack of mandatory requirements for full disclosure is a key shortcoming."

Officials couldn't be immediately reached for comment the morning of Jan. 19. But representatives of the Sales Integrity Task Force have said self-regulation of the auction industry is the best option.

The task force, which falls under the Thoroughbred Owners and Breeders Association, stemmed from efforts in Kentucky to pass legislation that would regulate sales. A Kentucky legislative committee signed off on the task force plan, which since has been presented to legislators in Florida as a model.

During the recent National Council of Legislators from Gaming States winter meeting, lawmakers received an update on auction integrity. They didn't appear anxious to recommend passing laws but did ask whether it would be practical to make public reserve prices at auctions.


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