06/13/2003 11:00PM

NYRA under fire; fights back

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ELMONT, N.Y. - The New York Racing Association on Saturday angrily responded to a report issued by the state's attorney general, Eliot Spitzer, which called into question the associations' business practices and suggested it be stripped of the right to run the state's three major Thoroughbred tracks.

The 64-page report, portions of which were printed in a front-page story in Saturday's New York Times, said the bookkeeping system NYRA uses at Aqueduct, Belmont Park, and Saratoga "functionally financed criminal operations," and claims management turned a blind eye to suspected corruption. The report also specifically criticizes NYRA president and chief operating officer Terry Meyocks for being unable to account for thousands of dollars in business expenses.

Barry Schwartz, the chairman and CEO of the NYRA, distributed a three-page written response, labeling the report "slanderous" and "short on truth and long on fiction." He was sterner with comments during a mid-afternoon press conference Saturday in the Belmont press box.

"This was a witch hunt," said Schwartz, who attended the press conference with Meyocks. "They kept looking for a smoking gun and they didn't find it. So, in the end they come out with a recommendation we should get rid of Terry Meyocks. It's ridiculous. It's absolutely ridiculous, and anybody in our industry, and certainly people in government, I think know better."

According to the Times, the report described various acts of corruption among mutuel tellers and parking lot attendees over the past three years, including money laundering and loan sharking. Most of the practices described in the report were results of criminal investigations completed in the past three years that have already resulted in convictions.

The attorney general's report was also critical of Meyocks for "injudicious" use of his expense account. The report said that Meyocks failed to properly identify members of his family who were included on the dinner checks. Some of the expenses "bear earmarks of immoderation," the report said, according to the Times.

In his written statement, Schwartz calls Meyocks "a person of impeccable character and integrity. I believe the Attorney General personally knows this to be true about Terry, and I am saddened that he would put his own agenda ahead of the truth about the life and reputation of a man who has never to my knowledge committed a dishonest act."

Schwartz intimated Spitzer's motivation for this report was in part due to his desire to be governor.

"In the old days, people associate gambling with crime and they get a lot of sensationalism out of the headlines they can create," Schwartz said. "I've been on this board for close to 10 years. We've always been the target of different types of attacks, I guess it's because of our high visibility. In prior years NYRA has chosen to turn the other cheek. I don't feel that way. I think we are being very unfairly attacked."

Schwartz acknowledged problems existed in the mutuel department, but said those problems have been and continue to be addressed. Schwartz said that in 2002 NYRA changed the system under which mutuel clerks report their business, changes made to "prevent improper conduct by NYRA mutuel clerks."

Schwartz also said that if not for the assistance of NYRA security, the attorney general's office would not have made as many arrests as it did.

"Their investigators are like the gang that couldn't shoot straight," Schwartz said. "I can't begin to tell you how many tips we've given state investigators and the FBI on things that NYRA security has uncovered that have led to arrests."

Schwartz pointed out that the report "does not in any way call into question the integrity of NYRA's races." He also chastised Spitzer for not mentioning that NYRA "cooperated with the Attorney General's investigators for a period of nearly three years."

Spitzer's report pointed out that Meyocks, who earns $375,000 annually, charged more than $140,000 in expenses to his corporate credit card. Schwartz said those expenses covered a four-year period and were for more than just Meyocks.

"What they failed to tell you is the expense accounts are for all the executives within the management group," Schwartz said. "If Terry went to the Derby and took six people from NYRA those six people's airfare are on his expense account. They totally distorted the facts to get it to read like they uncovered some great undoing."

The report called into a question a $1,000 dinner tab for a party of six at the prestigious Le Cirque 2000 in Manhattan.

Schwartz said that dinner was for Don Orlando, the track superintendent who was retiring after 41 years of service. The report also quotes Meyocks as saying "Social life and racing life are two sides of the same coin. I am 24/7 on racing."

Both Meyocks and Schwartz denied that comment was ever made and Schwartz noted that a court stenographer was not present at the meeting at which the comments were allegedly made.

NYRA, a quasi-state agency that must reinvest its profits in the tracks or distribute the profit to the state, receives its license to operate racing at the three tracks from the state legislature. This year, NYRA's franchise was extended by the legislature to the end of 2013 as long as the association begins operation of slot machines by March 1, 2004.

- additional reporting by Matt Hegarty