02/13/2004 12:00AM

Trying to help handle, tracks cut off big shots


It is counterintuitive to believe that a racetrack can cut off some of its largest bettors in order to grow handle. But that is exactly what is happening at Tampa Bay Downs, where officials stopped sending the track's signal to several huge offshore rebate sites at the beginning of the meet.

All-sources handle at Tampa Bay Downs is up 30 percent since the track opened on Dec. 13, according to general manager Peter Berube. The increases are the result of several factors, Berube said, and one of them is that Tampa's players are no longer competing against computer-based arbitrage systems employed by rebated players operating out of Caribbean account-wagering sites.

Australian offtrack betting companies have long held the view that net winners are bad for horse racing because they drain cash from everyday players. In fact, offtrack officials in that country aggressively attempt to identify profitable players in order to cut them off. The offshore sites that were betting on Tampa's races last year were beating the takeout by an unbelievable 30-point margin, Berube said; a site is considered a net winner if it consistently beats the takeout at all.

"The main theory behind it is that you have sites winning disproportionate to the rest of the simulcast network and your ontrack players," Berube said. "They are taking that money from your everyday players, and they are not betting it back."

To be fair, Tampa's business is up for a number of other reasons. Ontrack attendance has been strong; the track is available in New York City's OTB's five days a week this year, compared with three last year; and field size, one of the prime determinants of pool size, is up to 10 horses per race, from 9.3 last year. Still, Berube believes that even when accounting for those factors, Tampa's players are betting more because the offshore sites aren't taking their money.

Tampa is not alone in attempting to change the dynamic. Earlier this year, Fair Grounds in New Orleans decided to cut off bets from offshore sites at zero minutes to post, when the horses reach the gate. On Thursday, Oaklawn Park in Arkansas announced that it had cut off many offshore rebate sites at the beginning of its meet on Jan. 23.

Offshore rebate shops have become one of the most controversial issues in racing. Many large tracks are loath to cut the sites off because their players, who sometimes receive rebates of 10 percent on their handle, are some of the biggest bettors in the game. But many horseplayers say that the sites' bettors enjoy unusual advantages in addition to the rebates, pointing to access that allows them to pour hundreds of huge wagers into the pools seconds before a race starts.

In addition to the cash drain on everyday players, officials from the three tracks said, the offshore sites are having deleterious impacts on how bettors view the integrity of the pools. Because rebate players bet at the last possible second, odds at tracks targeted by big bettors can sometimes fluctuate wildly after the horses leave the gate. A panel of horseplayers convened by the National Thoroughbred Racing Association has said that the odds fluctuations are the most abhorrent aspect of the game and have invited widespread suspicion of cheating.

Bryan Krantz, the president of Fair Grounds, said that handle through the hub that has been cut off at zero minutes to post has dropped to 20 percent of its previous level. But he said past-post odds fluctuations have dropped off as well.

"It's either a small group of players or one player who has direct access to the tote and is using an arbitrage system to search at the last minute for inefficiencies in the pool," Krantz said. The cutoff, Krantz said, was triggered by a stipulation in the rebate shops' simulcast contracts that allowed Fair Grounds to modify the relationship with the shops if late odds changes became "disruptive."

Bobby Geiger, the simulcast coordinator for Oaklawn Park, said that Oaklawn cut off the rebate shops in order to restore a sense of fairness among the track's regular players, citing consistent winning by the shops.

"The average racing fan was catching on," Geiger said. "He wasn't winning. I don't care what the rebate shops say, but we need those people."

The tracks' decision to cut off signals introduces a slippery slope. For example, what happens if an offtrack site in Phoenix suddenly starts winning? Would Tampa cut the site off?

"It's something that has to be done on a case-by-case basis," Berube said. "This is something we talked about for years. I think the targets are going to be these places that have unfair advantages, not some place that has a couple good days."

Krantz agreed, saying that parimutuel pools are not free-for-alls. He cited regulations governing securities markets that prohibit insider trading and other practices.

"The market for betting horses is not really that different, and it has similarities," Krantz said. "One group should not have distinct advantages where they can lower their effective takeout and imbalance the pools."