By Ken Kirchner
The recent announcement of an official inquiry into the results of the $1 million Breeders' Cup Betting Challenge should set off an alarm bell for the racing industry. The audit action by Breeders' Cup Limited is focused on potential collusion and other possible rule infractions by multiple contestants in the 2017 BCBC.
As many know, handicapping tournaments have been a growing business segment for the industry over the past 10 years. The two primary events are the $2.5 million National Handicapping Championship operated by the NTRA and the $1 million BCBC, with numerous other supporting contests and tens of millions of dollars wagered online by players competing in daily contests.
With so much money at stake, it was only a matter of time until controversy reared its ugly head. As one of the creators of the NHC, the BCBC, NHCQualify.com and DRF Tournaments, it is my belief that the primary issue here is a lack of transparency (I no longer have any role/stake in these events).
Player Transparency
There are two key issues currently lacking in player transparency: the first is player selections in contest races. Neither the NHC nor the BCBC make available a listing of a contestants' wagering selections in real time or immediately following a race. The one exception is the NHC Final table. It is impossible for other players to know what selections another contestant has made, preventing peer review as a means to monitor potential irregularities.
Second, player partnerships are not disclosed, declared, monitored or audited. Both the NHC and BCBC permit a player to have two contest entries and this is announced to all the contestants. What isn't known is the status of other partnerships or relationships amongst the contestants, and it is not uncommon to see six or more entries with family ties. We all appreciate how handicapping can be a family affair, but contest play with multiple tickets is much different from daily betting.
Likewise, there are many players with formal and informal partnerships wherein a player may buy into another players' entry. When online entries and contests are considered, the auditing and partnership issues become even more complicated.
Tournament operators generally require that all entries are played independent of each other, but there has been limited monitoring and auditing of these items. That raises the spotlight on the current BCBC inquiry involving possible collusion amongst entries and rules violations.
Rules Transparency
Currently, only the NHC highlights rule changes at their main event. Many other contests simply print out the rules, have a player sign an affidavit stating they agree to be bound by the rules, and proceed with the event. As a former contest administrator, it was always shocking how many players ignored reading the rules of the event.
Certainly, it is the players' fault for not properly reading and understanding the rules. There are occasionally disqualifications due to a player's simple mistakes from not reading the rules. At the same time, the contest operator has a responsibility to ensure that the players are aware of and familiar with the rules, particularly any rule changes implemented from prior years.
Operators also have the duty to make sure the rules are clear, concise and understandable to all players. Rules should not require a law degree to interpret.
Operator Transparency
Contest audit functions are essential to verifying and certifying the results of these tournaments, as there are literally millions of dollars to be won at the NHC and/or the BCBC.
The financial aspects of the tournaments themselves should also be subject to full transparency. Players are now investing tens of thousands of dollars in their pursuit of contest titles and bonuses, paying $10,000 per entry for the BCBC and thousands for other events. It is incumbent upon the operators to disclose their full prize and payout schedules so that players may properly understand what their entry fees are buying.
Surprisingly, in an industry that suffers from over-regulation of so many aspects of the sport, live and online tournaments seem to have been flying under the radar screen. Other than the operator themselves, there is little or no review of tournament results by any regulatory or independent bodies.
The rapid growth in these tournaments has been a positive development for the racing industry. New players are participating, and contests offer an alternative way to play the horses. There are specialized game theories, handicapping and wagering methods that are being utilized by the players to maximize their opportunities.
While not quite the poker tourney boom of a few years ago, there is an opportunity for racetracks and the industry to develop and educate fans about handicapping contests. But if the tournament growth is expected to continue, there will have to be greater audit responsibilities, rules enforcement and disclosure amongst all parties. The best course of action for the future of handicapping tournaments is full transparency–from both the players and the operators.
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