Nice Letter to Editor TGJB

[Saddlecloth]

I cant say I disagreed with anything you say in the piece.

The letter:
 

Rebates and milkshakes a poor combination

Over the last few years, racing has faced some problems. Not real ones, mind you - \"problems of perception,\" as some put it. Good thing, too - real problems require real solutions, while \"problems of perception\" require only solutions of perception. Now, shockingly, we find ourselves with a scandal - just the thing that industry leaders and racetrack operators wanted to avoid.

The main \"problem of perception\" involves drugs. Many horsemen and serious handicappers using speed figures have become convinced that certain trainers are regularly moving horses up in dramatic fashion, getting improvements way beyond those that can be obtained by good horsemanship. In fact, last year\'s DRF Expo featured a panel on the \"supertrainers.\" But we must all have been wrong, because other than a few token gestures concerning one drug (milkshakes), the industry has taken no steps to protect the betting public, and the honest horsemen.

So here it is, guys: a four-point plan that will dramatically help with this problem. It will cost a few bucks, but it\'s worth it.

1. Build a 24-hour detention barn at every track. Horsemen will scream initially, but they will get used to it. And you will eliminate raceday drugs such as milkshakes.

2. Freeze the samples of the winner and a random horse from each race at every track. From what I\'ve been told it\'s not that expensive, and it is a very powerful deterrent. The drug guys are ahead of the testers, but not ahead of where the testers will be in five years.

3. Make the trainer name with every entry a veterinarian of record who will be subject to penalties, and list him in the program, which will make it easier for all of us to track what\'s going on.

4. Make the trainer and vet fill out and sign off on a form with every entry, listing everything that has been put into the horse over the last seven days.

Unfortunately, the recent scandal has created an atmosphere of hysteria in which drugs have become linked with rebates, due in part to the unfortunate initial coverage in the Racing Form, which, in the first paragraph of the Jan. 16 article \"Glare on sport\'s dark corners,\" linked drugs and rebates equally as the two \"issues\" facing the industry. The Form continued to fuel the fire in subsequent articles, while not showing how racing\'s interests were adversely affected by rebate houses, pausing just long enough to let one particular rebater - Racing and Gaming Services - have two paragraphs for a lawyer\'s statement distancing itself from the scandal. Not surprisingly, that was the only major site not cut off by the New York Racing Association and others a couple of days later.

Look, if someone is doing something illegal, they have to be really dumb to bet through a rebater. This scandal has shown why: Account wagering companies require names and keep records, while you can go to any racetrack, simulcast site, or OTB in the land and bet in total anonymity. And other than the drug aspect, which really is important, the alleged crimes involved in the scandal are technical violations of far greater interest and consequence to the IRS and those who sell newspapers than to those of us in racing.

Full disclosure: My company has a business relationship with a rebate outfit, not one of the ones named in the indictment. But what racetracks need to do is cut out the middlemen and either lower the insanely high takeout or give rebates themselves. Failing that, anyone who thinks the enormous amount of handle generated because of rebates is simply going to be put through the windows at full price hasn\'t been paying attention. It will either go to non-parimutuel sites that offer rebates or disappear entirely.

Another \"problem of perception\" is that many of us believe that the pools are being tampered with after betting closes, and it\'s easy to solve, independent of rebates - simply close the betting before the first horse is loaded and transfer the data to another computer, which is then isolated.

But hey, if another scandal does explode, it will just be a problem of perception.

Jerry Brown, New York City
President, Thoro-Graph Inc.

[Chuckles_the_Clown2]

Very powerful stuff

Can anyone elaborate upon the 24 hr detention barn?  Is that a large \"RaceDay Card Barn\" where all starters have to be stalled a full day before a race, some distance from the trainers assigned stalls?  Thats how I\'ve interpreted it. Yes, Its possible they would not even have to build a new barn or two. Just designate those close to the offices as the \"Race Day Dentention\" barns. All monitored with video of course.

They would need room for approximately 100 horses, so maybe they would have to build. I like this idea the best. A detention barn!



Post Edited (01-22-05 01:19)

[SoCalMan2]

Bravo

[SJU5]

Great letter Jerry...KEEP UP THE PRESSURE

[Saddlecloth]

The race day barn was proposed at santa anita this meet but was met with such heavy resistance it was abondoned.

[TGJB]

CTC-- that is the idea behind the detention barn. I would go for not only video surveillance, but ROTATING guards (not ones spinning in circles, different ones watching a trainer\'s horses each time).

SJU5-- I do what I can. But it is important that YOU GUYS keep the pressure on-- follow up letters to the Form saying you agree, letters to NYRA, etc. Best is a letter sent to both, and saying so in the text.

By the way, there was an unbelievable odds drop at GP yesterday-- Sir Swervalot was 5/2 on the board as he pulled up past the wire, and paid $6.00. No problem.

[Chuckles_the_Clown2]

TGJB, do you really believe there is past posting going on? In \"The Sting\" they used past posting tricks to convince Robert Shaw they were wiseguys. But the potential for past posting in the computer and simulcast era seems significant to me. I do know of some interesting late odds changes. Funny Cide in the Derby took a significant drop upon payout for example. You\'re record of ascertaing issues and taking advant guard positions has to be considered by those contemplating the issue. A little care to prevent it certainly seems to be practical to me. How much money do you figure went down to change the odds a half point? Thats doesn\'t seem especially significant to me.

CtC

[TGJB]

I don\'t know whether past posting is going on or not, and I don\'t know how much money it would take to cause the GP drop, although someone on the Deby List posted that 25k came in late (after)? With an antiquated system with hundreds of points of access, it seems pretty obvious that someone could hack in. People have hacked into NASA for the fun of it, and there ain\'t no money in that. There is here.

Great Job!

[xichibanx]

In harness racing they have detention barns where all stake races at least at Meadowlands are run out of including a rotating schedule of regular races.  People ask me why I would rather look at Meadowlands Harness.

[TGJB]

CH-- thanks. They buried me a little with placement, which I don\'t think was an accident, and didn\'t use my title (\"Problems Of Perception\"), but hopefully it will draw some attention.

Still waiting for an official result from Vegas...

[Michael D.]

TGJB,
i don\'t know all that much about the rebate shops, other than the one i use is legit, and some others out there treat US tax laws like nyc residents treat \"don\'t walk\" signs. the stuff about illegal substances was great though. if guys like pletcher, velazquez, castellano, stronach, frankel, juddmont, and mandella really are performing at the level of the all-time greats, and they are doing it within the rules, they deserve the credit. if smarty, GZ, and some of the other great horses are performing as well as some of the all-time greats, they deserve the credit. if any of these entities are not playing within the rules, however, they need to be exposed. the problem in the current environment, however, is that many of today\'s stars are guilty until proven innocent. every time something great happens in this sport, there is suspicion. we now have a sport without stars, and that is a recipe for disaster. TGJB, i think your proposals will help the honest guys as much as they will hurt the cheaters. well done.

[P.Eckhart]

The following is an excerpt from a piece written by Ed Bain on his time at the DRF Expo.

---------
We broke for lunch and during that time I had an interesting conversation with
one of the owners of United Tote regarding the really big bettors in racing that
were betting millions. He stated that there are only eight players or consortiums
betting on racing in the world and almost all were individuals who headed a group.
I said there is this impression that there are thousands of big players betting
millions each day. He laughed and said no believe me I know them all, there are
only eight because he has tried to recruit them to bet through United Totes host
tracks, but with out much success. He stated this was because they can't offer the
rebates that an off shore rebate shop can. We talked about how these consortiums
bet by using computer programs hooked into the tote systems and the advantages
they have. He stated that these groups of bettors could not beat the take, without
the rebate, they would lose money. I shook my head, and said it would seem to me you
would have to show a positive Return On Investment before you could bet millions
through a rebate shop. He stated no, they have found a way to beat the system by
betting millions each month by enticing off shore rebate shops to take their bets
and use their influence and computers, which were hooked directly to the betting pools.
He stated "they also have another advantage other than exploiting betting pools with
their computer programs. They have about a ¼ of a mile run before the tote companies
betting windows close".  I said "A ¼ of a mile?"  He nodded "Yes." I said, "Now that
is a true advantage. Because if you have a computer program that can identify lone speed
and let you have a ¼ mile to decide to place a bet, I would label that cheating. That's
an unfair advantage that we as every day players don't have. If I was a speed player
betting lone speed, I only have to get a hit rate percentage on my ability to find lone
speed, then I would bet millions."  Our conversation went from that to how they bet
finding betting pools that were undervalued, and to make money they had to have the
rebate because without it they weren't good enough to make a living betting on the horses.
------------------------

I\'d like to say a few things about it.

1. The United Tote rep is being remarkably frank here. This surprised me in view of what he is saying openly.

2. That there are only a handful of huge groups makes perfect sense. Moreover, I would say these groups do not compete with each other else cannibalisation would certainly take place. In that sense there must be some sort of agreed carve up of the tracks between these groups.

3. That they are getting \"1/4 of a mile\" again makes perfect sense. Not in the way Ed describes it as being a tactical form advantage ie lone speed etc (although it could be used as that too), but primarily
as a mathematical advantage. A key component of extracting the economic inefficiency out of a pool is knowing the final race handle. This is what giving them 1/4 mile is all about. Knowing the exact handle enables them to calculate the optimum amount they can inject into the pool to maximise return on capital outlay.

4. This relates to the last sentence. The only (endemic) economic inefficiency that I am aware of that existed in racetrack betting markets is the fav-longshot bias. In very simplictic terms, that favs are underbet and longshots overbet. Somewhat counter-intuitive but that is why it lay dormant for so long though it has been known for a long time now, just maybe not exploited for practical reasons which computers, networking and (particularly) rebates solve. The fact that some people say the bias is now gone is maybe testament to these groups ability.

If I am right, or even if I am wrong the Tote rep\'s words still surprise me. He is clearly not scared of a court case. This implies it is all legal. In that case, your betting system is legally corrupt if they are shutting shop then giving 25 secs more to these groups.

[cubfan0316]

they would just have the guy runnin the holding barns drugging them anyway.wheres the gamblin theres cheatin..

[MO]

CTC:  Those who know me know I gave up betting on horses seriously in 2000. I take a stab on an occassional rotw but for all practical purposes I am out of the loop. I didn\'t even know who Ghostzapper was until a week before I cashed him in the Breeders Cup.

I am convinced there is past posting going on. I strolled into Aqueduct while between gigs on Jan. 8 to kill some time. Bet an exacta at Calder. My combo was paying $26.00 ON THE FAR TURN. I collected $16.80 (or thereabouts).

Bet a harness race back in November. Horse was paying $9.00 ON THE TURN. I collected $6.80.

Bet an exacta at Suffolk downs in June. Exacta was paying $66.00 ON THE FAR TURN. I collected $44.00.

Oh yeah. I left one out. Ghostzapper was paying $9.00 ON THE TURN.  Think he paid all of $6.00.