An incorrect takeout percentage on winning exotic bets that was set by the New York Racing Association didn’t cost bettors as much as initially calculated.
The state Comptroller’s Office released an audit Friday that revealed the 15 months of too much money being withheld from exotic bets on NYRA races only cost gamblers $7.4 million. It was initially believed the error was worth $8.5 million, when factoring in bets made at the tracks, at Off-Track Betting parlors and at other simulcast locations.
The latest revelation came as the Comptroller’s Office looked into whether the New York State Thoroughbred Breeding and Development Fund has been receiving the appropriate contributions from state race courses, the OTBs and video lottery terminal operators.
The audit didn’t reveal a change in the amount owed to bettors with NYRA, whether at the track or through its other wagering options. As of this spring, NYRA had returned almost $600,000 of the $1.1 million that was illegally denied winners. Other simulcasting locations, which get their rates from NYRA, had combined for about $69,000 in reimbursements as of May. Capital OTB had returned almost $12,000 to almost 100 bettors.
It’s still not clear what NYRA, the OTBs and the other simulcasting outlets did with the funds that were not returned.
The incorrect takeout percentage resulted in the firing of NYRA President and CEO Charlie Hayward, who may have known about the mistake and allowed it to continue, based on an interim state report from the spring. In the wake of that revelation, a state takeover of the troubled racing corporation was announced, with a new board taking control last month.
The mistake, which went into effect in September 2010, when NYRA didn’t lower its takeout rate, remained in effect until December 2011. It was detected by the Comptroller’s Office when the state Racing and Wagering Board moved NYRA to lower the rate to the legal limit.
NYRA ended up setting the rate one percentage point below the maximum allowable takeout.
It took the state about 15 months to detect the error, even though at least three state bodies were responsible for detecting the mistake, which was advertised on NYRA’s website.