Past Posting, Naw!

[miff]

Thoroughbred Racing Protective Bureau reports past-posting incident
By Matt Hegarty DRF

LEXINGTON, Ky. – Eleven win and exacta bets were made on an unidentified race three weeks ago after the race had already been run, the Thoroughbred Racing Protective Bureau's director of wagering analysis disclosed Tuesday during a presentation at the Simulcasting Conference here.

J. Curtis Linnell, the bureau's top wagering security official, said after the presentation that the incident was known to the authorities and that the state racing commission and host track are conducting an investigation. When asked, he would not disclose the identity of the track where the race was held but said it was a Thoroughbred track.

The wagers were able to be placed on the race after it had already been run because a single site in the track's simulcast network did not recognize the stop-betting command that was issued after the race started, Linnell said. Because the wagers were counted in the pool, they depressed the legitimate win and exacta payouts for the race. A person with knowledge of the late bets made a call to the Thoroughbred Racing Protective Bureau to report them, Linnell said.

The incident is sure to provide fodder for critics who, citing fluctuating odds during the running of a race, contend that past-posting is widespread in racing. Linnell said that such incidents "do occur," but that they are extremely rare, and, because of security protocols put in place over the last five years, they are almost always detected because of automatic signals generated through the bureau's auditing software.

Linnell said that when the investigation is complete, the identity of the track will be released.

Linnell mentioned the incident at the beginning of a presentation on a new tote security initiative that is being developed by the bureau and that has been funded by the tracks within the Thoroughbred Racing Associations, which administers the Simulcasting Conference. Linnell had said that the incident three weeks ago would have been averted under the new system's protocol for issuing stop-betting commands.

The new security protocols will be tested in a live-operating environment beginning in November, Linnell said during the presentation. The tracks and simulcast sites that have agreed to participate in the project will begin to be added into the system in early 2014, Linnell said. There are 41 members of the TRA, which includes most of the United States's most prominent tracks.

But the cost to participate in the network has already become an issue, with operators of several small sites complaining at the conference that the $950 monthly cost was too heavy a price to pay, especially considering that every licensed business that takes a bet will be assessed the same cost, regardless of size. For example, a small greyhound track in Florida that takes Thoroughbred signals will be assessed $950 each month, as will the mammoth New York Racing Association.

"That's just not fair," an unidentified parimutuel operator complained to Linnell from the audience.

The new system also will calculate updated win odds to the 10th decimal place at 2-second intervals, Linnell said. That should lead to less dramatic late-odds fluctuations, which are many times caused by enormous batched bets made by computerized robotic wagering systems. The odds will be updated every 2 seconds for at least 10 seconds prior to post, with the odds updated on 10-second intervals in the last 2 minutes.

The rapid odds updates will be limited to the win pool when the system is ready for implementation, Linnell said. The updating protocols will then be gradually applied to other pools, with the exacta pool most immediately in line.

[miff]

Even worse, Cali friend just tells me it was at Golden Gate AND they did not even know it happened until days later when a call was made alerting them of the past post

.....what a bunch of amateurs these so called racing execs are.

[Boscar Obarra]

Anything can and will happen.

  Nearly 100% of What people think is past posting is not, and will not change under the new protocol. You will get to see the odds drop a lot faster then you do now however, probably before the gates open.  Long overdue.

[miff]

\"Nearly\" isn\'t nearly good enough.Not the first time this happened.Who knows how many past posts may have gone undetected,as this one would have, if a dime wasn\'t dropped.

[Boscar Obarra]

Agreed, it should never occur. But the point is, if we lock it down to 100%, you will still have massive odds drops at the bell.  That\'s a fact.

[P-Dub]

We all deal with the massive odds drops, and that isn\'t the point.

The point is, as Miff stated, how many times has it happened undetected?

It isn\'t the odds dropping that bothers people, its the past posting that is cheating people out of their money.  Most recognize the reason for late odds drops.

It said one hub didn\'t recognize it.  Is it possible this was done manually, and there was some kind of con taking place?  Why would someone past post if they didn\'t know the bets would count?  Do these people just randomly past post hoping that by chance it will be accepted?  Sounds a little fishy to me.

[Boscar Obarra]

If there weren\'t the obvious  late odds changes, why would anyone even suspect past posting?

  If there is past posting and its so hard to detect that the prices hardly change, then this is the LEAST of your problems.

  Don\'t know the details of this incident, but should be interesting.

[P-Dub]

They wouldn\'t.

If someone can past post with such regularity, taking out small chunks nobody would recognize...sure, that\'s a problem.

You\'re suggesting that\'s happening, or is plausible??

[Tavasco]

Now it is probably not this simple. But imagine unplugging the Ethernet cable (network connection) a few seconds prior to the shutdown signal and reconnecting seconds later. Voila!

Or it could be.

[Bet Twice]

The new security protocols will be tested in a live-operating environment beginning in November, Linnell said during the presentation. The tracks and simulcast sites that have agreed to participate in the project will begin to be added into the system in early 2014, Linnell said. There are 41 members of the TRA, which includes most of the United States's most prominent tracks.


This must have happened a couple of years ago, no?

[Boscar Obarra]

I dunno man. This is 2016. This kind of trivial data can be processed and distributed instantaneously.   I suspect more stock market data is processed in 3 seconds, than is created in an entire DAY at every racetrack in the country.

 Some serious foot dragging/ineptness here.

[Mathcapper]

Bet Twice Wrote:
-------------------------------------------------------
> This must have happened a couple of years ago, no?

Article was originally published on Oct 8, 2013 on DRF site.

[miff]

Bloodhorse:

The industry\'s embrace of computer-robotic wagering through the high rebates required to sustain these players has resulted in a less attractive game for all other horseplayers, according to an expert presenting March 25 at the Association of Racing Commissioners International conference in New Orleans.

Thoroughbred Racing Protective Bureau vice president of wagering and analysis Curtis Linnell presented a TRPB study looking at North American pari-mutuel handle in March 2016 that determined CRW players accounted for 15.9% to 20.2% of total handle during the month and cashed out between 17.9% and 23.1% of all March pari-mutuel winnings.

That success rate resulted in lower payouts for every other bettor in the pari-mutuel pools. While these large-volume players are making the betting product less attractive to all other players by lowering winning payouts, racetracks, for now, see the added liquidity of their handle as more valuable than their negative impact on payouts.

\"There is a dampening effect on the rest of the market in the form of lower payouts, that\'s an undisputable fact,\" Linnell said. \"Now does the additional liquidity offset that? A lot of tracks would say yes.\"

CRW bettors are players—typically teams of players—that rely on computer programs to scan for value in pari-mutuel pools. The computer programs then allow these teams to pour money into each pool where they find value, thanks to the capability of making thousands of wagers in an instant. They have profited under the model.

\"You can see that the cashing skews slightly higher than the betting as a percentage of handle, and that\'s before rebates and everything else,\" Linnell said of the March study by TRPB, a wholly owned subsidiary of the racetracks\' Thoroughbred Racing Associations. \"Those are the numbers.\"

Dick Powell, of Racing and Gaming Services, which caters to CRW bettors, said large rebates on CRW handle make the business model of the CRW player possible. He noted that many CRW players try to break even on their wagering, and then make their money on rebates. Linnell\'s study indicates CRW players are doing better than breaking-even on their wagers.

\"For racetracks, CRW players add liquidity to the pools, which is a very good thing for a racetrack,\" Linnell said. \"The trend is toward greater access to computer-robotic wagering platforms. So racetracks in general have permitted in, and in lots of cases welcomed, CRW players. Not all of them.\"

Linnell said Oaklawn Park is the largest track to not allow them. Arkansas State Racing Commissioner Mark Lamberth said that decision has worked very well for Oaklawn, disputing a contention by Powell that on-track wagering has suffered at the track since it banned CRW players a dozen years ago.

Powell said CRW players are merely successful horseplayers, who typically gather more information than other bettors in the pools. He said when he worked as a track executive when racing first began to offer off-track wagering, he noticed that on-track bettors, who at that point in time had more information available than off-track players, fared better than the horseplayers off site. He said bettors in the $50 lines fared better than the $2 players.

But Powell also noted that CRW players are highly reliant on the rebates they receive to make their model work.

For tracks, the about $2 billion poured into pools last year by CRW players has not translated to big profits. Linnell said the percentage of total pari-mutuel handle going to tracks has never been lower, in large part because of the industry\'s embrace of rebating its largest-volume players.

Linnell noted that nearly $5 billion has disappeared from Thoroughbred pari-mutuel pools since 2002, a trend that might lead many businesses to look at their pricing structure. But instead of lowering its takeout for all players, which would be a more attractive model to new- and medium-level horseplayers, the industry has taken the approach of rebating its very top players. That approach means that tracks receive less benefit from every dollar wagered by these players.

(Takeout is the money kept largely for tracks, purses, taxes, and these days rebates. Essentially it\'s the price a bettor pays to bet a horse race.)

Rebates to CRW players, in part, are funded by all other players paying those higher takeout rates. Linnell noted that events like Breeders\' Cup, which do not offer much in terms of rebates to these players, see relatively low action from CRW players. Powell suggested that this drop was more attributable to the number of European-trained horses at Breeders\' Cup that CRW players may not have a model.

Linnell said there currently are about 21 CRW teams with the largest team accounting for 40% of CRW handle. Looking at the various percentages, that equates to about $750 million wagered in 2015 by that single CRW team. Linnell said the top three CRW teams account for 65% of CRW handle and the top six account for about 80% of the CRW handle.

It\'s a possibility that CRW players could face added scrutiny by states updating their laws on daily fantasy gaming. On March 23 at the ARCI conference, Massachusetts Gaming Commission staff attorney Justin Stempeck said the state\'s attorney general will soon add a list of protections for daily fantasy players and that would address CRW-type players in daily fantasy.

After that panel, Stempeck said the state plans to require daily fantasy sites to provide robotic-wagering options to all players. He said one of the two largest sites has agreed to that requirement.

\"For instance, if someone was playing in a thousand games and news broke of a late injury, this would allow them to update all 1,000 of their lineups in an instant,\" Stempeck said.

Linnell said he knows of one smaller ADW site that has added some robotic wagering options for all of its players but the leading sites have not added the option.

After addressing the business impact of CRW, Linnell also outlined regulatory concerns. He noted that CRW players have been very cooperative with the TRPB, which has been able to readily track their wagers. TRPB has conducted on-site reviews of the largest operations.

In an effort to prevent odds manipulation, CRW players are not able to cancel wagers through their programs. Panel experts and audience members agreed that the standard is for CRW players to call in such cancellations and provide a valid reason—a late scratch for instance—for the change. The experts said CRW players make bet cancellations less frequently than other bettors.

The most visible problem associated with CRW players has been late odds changes. Powell said those odds changes can be caused by a large wager by any player. While Linnell acknowledged that can be the case, he said 90% of the time late odds shifts are caused by CRW players.

Linnell said traditionally pari-mutuel pools used to become more stable as post time approached, because of the building percentage of money in the pools relative to the final pool. He said that now, with such a high percentage of handle coming from CRW typically bet at the last possible moment, those pools have seen high volatility.

\"These teams are a big percentage of the pool. They\'re estimating what the pool is going to be,\" Linnell said. \"As a win position, if one or more of those top six teams are on the same position, you notice it.\"

With such large wagers coming late into the win pools, odds can shift even after the gates open as the tote takes time to calculate all of those last-second wagers. Those odds shifts have frustrated many players, a situation tracks have tried to address through increased odds cycles as race time approaches.

Linnell said Laurel Park recently stated updating its win odds every 20 seconds as the race approaches, which he said gets nearly all handle into the pool—allowing for improved reporting of what the final odds will be—before the race goes off. He said Canterbury Park will try 10-second cycles this year.