09/29/2003 11:00PM

Simulcast leaders on alert


BURLINGAME, Calif. - Simulcasting officials are increasingly concerned about the influence of offshore betting outlets and rebate shops on both wagering handle and the integrity and security of parimutuel pools.

Their concerns were voiced on Monday and Tuesday at the International Simulcast Conference.

Concerns range from the amount of money that rebate shop bettors take out of wagering pools to the distribution of simulcast signals to betting outlets that are not known to racetracks. In addition, Paul Berube, the executive director of the Thoroughbred Racing and Protective Bureau, is concerned that savvy bookmakers could use rebate shops to reduce their risk on booked bets.

Rebate shops, which award players with cash refunds based on the volume of money they bet, have stirred controversy in the racing industry since their influence and wagering handle began rising in the late 1990's. Some simulcast officials claim that rebate shops recruit big bettors from racetracks. Others argue that rebate shops compete unfairly with tracks because they have little to no responsibility to cover the costs of live racing.

New concerns, however, were introduced at the conference. Curtis Linnel, a former simulcasting official at Hastings Park in Vancouver, Canada, who was recently hired by the TRPB as a wagering analyst, proposed that racetracks are dramatically underestimating the value of their signal to rebate shops, because of the negative impact the shops have on handle at other outlets.

In an analysis of how money won at the rebate shops keeps players at other outlets from winning and betting more of their winnings on races, Linnel said racetracks should add at least five percentage points to their simulcast fees to rebate shops to make up for the lost money.

Rebate shops pay some of the highest simulcast fees in the country, reportedly at least 5 percent of handle for some of the racing industry's best signals, compared with the industry standard of 3 percent.

Representatives of rebate shops maintain that they conform to all security standards for the industry's more traditional outlets. The representatives also maintain that rebate shops contribute to the health of the game by catering to high-rollers who wager tens of millions of dollars a year.

Berube offered a provocative scenario, saying that it is possible for bookmakers to use rebate shops to lay off action and simultaneously collect rebates. Forty years ago, when bookmaking on horseracing was more common, bookmakers often made big bets in parimutuel pools to cover potential losses on a large bet they had on one horse.

"If it's going on, it's likely to draw the attention of law enforcement," Berube said.

Officials also urged racetracks to be more vigilant about who is receiving their signals. Lonny Powell, the president of the Association of Racing Commissioners International, said that the industry should take strong action if faced with unanswered questions about a site.

"If that site does not want to be repaired, if it cannot be repaired, if it cannot afford to be repaired, our industry must discard it and be on our way," he said.