Scientific Games Still Reviewing Calif. Error

Company tells board that cause of "stop betting" failure has not been determined.

Scientific Games Racing has not determined the cause of a system glitch that caused its "stop betting" order on the Los Angeles Handicap (gr. III) at Hollywood Park May 16 to go unheeded at 33 off-track wagering locations, a company representative told the California Horse Racing Board.

"It is not uncommon that a site does not respond" to the transmission of the stop-betting command, Dave Haslett told the board during a short briefing at the CHRB's meeting June 5 at Santa Anita. He said the system includes a safeguard to protect wagering pools against so-called "past posting" on races.

Because California officials were aware that wagering remained open until after the race was completed, refunds were ordered of all bets from the import sites that did not respond to the "stop betting" command, regardless of when they were made. Those facilities included Keeneland, Arlington Park, Churchill Downs, Canterbury Park and several Canadian locations. About $100,000 was refunded to bettors at the affected sites, according to a CHRB staff report.

Haslett said he was confident that no one unfairly profited by the totalisator error. He added that the SGR wagering system at its Sacramento facility has been replaced within the past two years, so outdated equipment is not to blame.

"Testing on the production system is ongoing," Haslett said.

Asked after his presentation if he had any idea when the company's investigation of the incident might be completed, Haslett said he did not. He was prevented from answering further questions from a reporter by Brooks H. Pierce, president of SGR, who was in the audience.

Haslett said some of the jurisdictions paid off on winning wagers, but that was their decision. The winning horse, Red Arrow, paid $18.80 to win and keyed a $2 exacta worth $151.40.

In a May 22 letter to Kirk Breed, executive director of the CHRB, Pierce wrote, "Since it appears that any possible past post wagers were not accepted in the Hollywood Park pool by the exclusion of the 33 import sites, we believe there was no exposure to the wagering public. To the contrary, the action of excluding the pools, in our opinion, upholds the integrity of the Hollywood Park pool."

He said that SGR is not involved in compensating those who forfeited winning wagers. "Since 24 of the 33 affected import sites are not customers of SGR, but of other totalisator companies, we do not have any definitive information on how bettors were or may be compensated in all jurisdictions," Pierce wrote.

Bon Smith, assistant executive director of the CHRB, told the board, "We do not believe this qualifies as past posting because no one profited from it."

In urging SGR to quickly complete its review of the mishap, commissioner David Israel said, "This goes right to the heart of people's confidence in the wagering system."

After the meeting, board chairman John Harris said that he was satisfied that no damage was done to California's wagering public and that Scientific Games was taking the matter seriously in order "to keep this from happening again."

"They have three of their heavy hitters from back east here," he noted.

Breed added, "We are serious. We want to get to the bottom of this, but it is very complicated. It points to the need, and I always come back to this ... to have real time independent monitoring of our wagering systems. We have to have people who know what they are doing who can follow this stuff."

This latest California wagering technology failure follows an error involving SGR terminals in 2008.

That came to light when a bettor at the former Bay Meadows in San Mateo purchased 1,300 “quick pick” bets for the Kentucky Derby superfecta, in which the first four finishers must match the exact order of an individual $1 ticket.  However, the “20” horse was not included in any of the possible 5,200 spots on the bettor’s tickets. The omitted number was the race favorite and eventual winner, Big Brown.

Scientific Games said that problem, which it had known of for several months, was the result of a computer glitch in which their wagering terminals excluded the highest numbered horse in every race from being part of the quick pick pool. The company reached a $200,000 settlement with the CHRB over the matter.