12/09/2004 1:00AM

Sale ethics discussed


TUCSON, Ariz. - A new code of ethics for public sales of Thoroughbreds in Britain has produced encouraging results, according to an official with the British Jockey Club who spoke during a panel examining auction reforms Thursday at the Symposium on Racing.

The British policy is being closely watched in the United States, where a sales-reform task force is scheduled to release a position paper on Dec. 16 outlining recommendations for a U.S. code of ethics. The task force was formed this year after Satish Sanan, the owner of Padua Stables, issued a call for the bloodstock industry to change some of its practices.

John Maxse, the public relations director for the Jockey Club in Britain, said that the new policy was put into effect in August, in time for Britain's major yearling sales. Under the policy, the Jockey Club has been given powers to investigate complaints of ethics violations and to ban people from any racetrack or training facility in the country.

No complaints or bans have been issued yet, Maxse said. But the policy has become a guide for new buyers at auction sales, and Maxse said the policy's existence is likely having a deterrent effect.

British officials undertook the project to develop a code of ethics after two highly publicized court cases in England revealed kickbacks in sales and a scheme in which two trainers artificially raised the price of an auction horse by agreeing to bid against each other, Maxse said.

The British Jockey Club's centralized power to ban individuals from racetracks and training grounds is unmatched in the United States, where such powers are spread over a variety of state racing commissions. The lack of centralized power to level punishments has become a matter of concern for a U.S. code of ethics.

Members of the U.S. task force have agreed to withhold comment on details of its recommendations until they are announced. But Nick Nicholson, the president of Keeneland and a member of the task force, acknowledged after the panel that imbuing the policy with the power to take action against violators has been "tricky."

Rollin Baugh, a prominent bloodstock agent, said on the panel that racing needs to change its culture at auctions in order to punish unethical behavior. He said the key to any good code of ethics for the bloodstock industry is disclosure.

"Anything is okay in a business transaction if all parties know everything that needs to be known," Baugh said. "If someone wants to charge a 20 percent commission, that's fine, as long as everyone knows about it."

Still, both Baugh and Joe Harper, the general manager of Del Mar, said that buyers need to take it upon themselves to ask as many questions as possible. Harper said that buyers must insist on getting answers, even if "they look at you as if you are stupid to ask."