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NEW SECURITY WILL STOP BETTING FRAUD LAST YEAR'S SCAM EXPOSED PROBLEM.

Byline: Ray Nelson Staff Writer

Three fraternity brothers from Drexel University have helped shape how wagering in the horse racing industry is conducted.

Of course, Derrick Davis, Chris Harn and Glen DaSilva had no thoughts of helping racing when they plotted to scam a national Pick 6 during last year's Breeders' Cup. However, the repercussions of the three scamming $3 million have been far reaching.

The industry has spent the past 12 months trying to ensure that the same type of fraudulent act could not happen again Saturday when the Breeders' Cup takes place at Santa Anita.

``Wagering and security of wagering is the backbone of the entire sport,'' said Greg Avioli, deputy commissioner and chief operating officer of the National Thoroughbred Racing Association. ``We're going to need the entire industry to pitch in to get this where it needs to be.''

Harn is the main reason for the changes in security. He worked for Autotote, which handles automated wagering through much of the horse racing industry. Through a loophole in the computer system, Harn was able to change the bet placed by Davis after four races. Thus, Davis' ticket had the first four winners. Harn then selected every horse in the final two races, thus ensuring Davis would hit the Pick 6.

Veteran horseplayer ``Jimmy the Hat'' Allard - known for wearing a hat to the racetrack every day - knew there was something amiss half an hour after Volponi's stunning victory, when the winning Pick 6 results were announced.

``As soon as they put the result up, I said, '... We just witnessed the greatest mathematical equation in the history of man, or fraud has been perpetrated.' ''

The scam was uncovered days later, and immediately, Allard called his attorney, Joseph Lisoni in Pasadena, and filed a class-action lawsuit against Scientific Games, the parent company of Autotote.

``The thing about this is, (Autotote) knew about this five or six years before the scandal and another company went in and did an independent research on it and told them, 'My God, this system is completely antiquated and completely vulnerable to fraud,' and they never did a thing about it.''

The National Thoroughbred Racing Association called on then-New York Mayor Rudy Giuliani's firm as a consultant and the industry went to work on improving safeguards. A position for a national security officer has been approved to ensure that there are minimum standards for betting sites and tote companies.

``There's certain aspects of the system that need to be improved. Some aspects continue to work fine,'' Avioli said. ``For example, all of the data right now, once it leaves a particular track or off-track facility, it has to go through some slow and antiquated lines before it merges into a frame relay system. Think of that as the superhighway - the ramps on and off the superhighway need to be upgraded.''

Avioli said the biggest improvement is the implementation of the ``progressive scan.''

``What you have to understand about the way the scam worked is that they found a way in the computer system to go back after the fourth race and change the actual bets on the first four races,'' he said.

``What the progressive scan does is keep track of all the tickets that are still alive - that still have an opportunity to win the bet - and the tickets that are not alive, so that after the first four races when the ticket that was not alive was changed, there would be a red flag. Bells and whistles would go off. That didn't exist last year; it exists now.

``The implementation of a progressive scan really prevents the exact same thing from happening.''
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Title Annotation:Sports
Publication:Daily News (Los Angeles, CA)
Date:Oct 24, 2003
Words:609
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