An employee of the company that processed a suspicious wager on Saturday's Breeders Cup races was fired yesterday as investigators continued to probe the circumstances under which a Baltimore man stands to win $3.1 million.
Autotote said it fired an employee and turned over evidence of "potential employee wrongdoing" to authorities investigating the case.
Autotote, a unit of Scientific Games Corp., of New York, did not disclose the name of the employee or details of the alleged wrongdoing.
"We are taking all necessary steps to resolve this matter as quickly as possible, and will continue to keep all authorities fully informed," Scientific Games Chairman Lorne Weil wrote in a statement.
He said the company gave the evidence it uncovered to the New York State Racing and Wagering Board and the New York State Police, which are leading the investigation because the bet was routed through a service in that state.
Stacy Clifford, a spokeswoman for the wagering board, declined to comment on Autotote's actions.
"The case is moving very well as far as we're concerned," she said.
Donald Groth, president of Catskill Off-Track Betting Corp., which took the disputed bet by phone, said he was told that Autotote fired an employee who worked in Newark, Del.
At Autotote's main office there, millions of dollars in bets placed by telephone, computer and simulcast networks are processed and forwarded to the tracks where the races are run.
Groth described the man as "a rogue employee" who had passwords that allowed him to enter the computer system and alter bets.
"This clearly is a major turn in the road," Groth said. "It was not the integrity of the system that was compromised, it was the integrity of a human."
The transactions under investigation concern bets made through Catskill by Derrick Davis, 29, of Baltimore. Davis picked the winners in six consecutive races at the Breeders Cup, a premier day of racing held this year at a Chicago racetrack.
In a key transaction, Davis wagered $1,152 on the Breeders' Cup Ultra Pick Six and was the lone bettor to select the winners, three of which were long shots.
His winning payoff - which has been frozen pending the outcome of the investigation - totaled $3,067,821.60.
Bets involving consecutive races are collated by a wagering service company according to an industrywide procedure designed to prevent strain on the system.
Catskill used Autotote, a leading tote company, to tally its customers' wagers.
The amount of money wagered on each race is immediately forwarded to the host track's system, so that odds can be calculated.
But the actual picks made by each bettor are not, in order to reduce the "data flow" into the computer.
After fourth race
Instead, only the picks of the bettors who selected the winners of the first four races - and thus are eligible to win the pot - are forwarded after the fourth race.
In the first four races, Davis bet only on the winning horse. In the final two races, he bet on every horse in the field.
This raised suspicions that the prior bets might have been altered in the computer after the races were run but before they were forwarded to the main computer that collated bets from around the world.
Davis, who operates a computer repair and installation business, has not responded to requests for comment from The Sun.
One source, who spoke on the condition of anonymity, said Davis has spoken with racing authorities in New York.
His attorney said yesterday that Davis has done nothing wrong.
"It is Derrick's position that he made a legitimate wager and he's concerned that there is a lot of speculation going on. He denies that he did anything wrong," said Steven A. Allen of Baltimore.
He declined to say whether Davis knows the fired Autotote employee.
"There is a process for investigating these types of allegations. It is early in that process. We're going to let that process go forward," Allen said.
"He understands the interest. He has the only winning ticket. We invite that scrutiny."
Groth said the initial investigation by Catskill reflected nothing other than a very lucky bettor who had also placed unorthodox - and losing - bets on the same day.
Yesterday, though, he said his opinion had changed with the new evidence uncovered by Autotote.
He said he has not seen evidence that Davis was involved in the alleged scheme. But it seemed improbable, he said, that an insider at Autotote would endanger his career and freedom to benefit someone he didn't know.
"Why would someone use their unique place in life to alter a bet for a complete stranger?" Groth asked.
A new account
Davis established his Catskill account a week or two before the date of the Breeders Cup, Groth said.
He told Groth that he is a regular at Laurel Park and Pimlico Race Course and he set up the account because he would not be able to get to a track to place the bets in person, Groth said.
If Davis is disqualified, then the winnings will be divided among more than 100 other bettors who picked five of the six horses, Groth said. Because they had won consolation prizes, they can be found by track officials using tax forms, he said.
Bennett M. Liebman, coordinator of the Racing and Wagering Law Program at Albany Law School of Union University, said it would be unusual for a Maryland player to bet through Catskill, which is the smallest of six off-track betting systems operated by various government entities in New York state.
Catskill offers a limited menu of tracks relative to larger and widely available systems, such as ones affiliated with the Maryland racetracks. (Davis has said that he found the Catskill site through a computer search).
Computer complications
Maryland law requires the use of a system based in Maryland or with a contract to a local track - requirements Catskill does not meet.
"I think it's extraordinarily suspicious," said Liebman, a former commissioner of the New York State Racing and Wagering Board.
Liebman said the proliferation of electronic gambling systems has increased the difficulties for regulators.
"In the old days you had a steward at the track who threw a switch and the betting was shut down. Now you have more and more electronic types of betting. It certainly has made it more complicated," Liebman said.
"The regulatory bodies are not ordinarily well equipped to control computer fraud," he said.
Someone caught changing bets in a tote company's computer system could face state and federal charges of fraud, as well as a federal charge of tampering with a sporting event.
Chris Sherf, executive vice president of the Thoroughbred Racing Associations, a trade group of racetracks based in Elkton, Cecil County, said its investigative unit is sharing information with law enforcement in the case. The group operates the Thoroughbred Racing Protective Bureau.
Sherf said he has never before heard of a case of alleged computer fraud such as this one. "Anytime where there is money there are people willing to cheat," he said.
Note in Highlandtown
Yesterday at a Highlandtown rowhouse in the 700 block of S. Baylis St. where Davis recently lived, a note posted on the front door read: "Dear Press, Derrick no longer lives here. I do not have a forwarding address."
A man who answered the door declined to identify himself or discuss what he knew about Davis, saying, "He asked me not to. He's just a very private person."
Last night in the 7900 block of Underhill Road, where Davis' parents, Tom and Vanessa, were welcoming trick-or-treaters to their Rosedale home, his father said he was excited that his son had come into some money and believes he did nothing wrong.
Davis hasn't lived with his parents at their two-story home since he left to attend Drexler University, they said.
Records show that Davis lived in Philadelphia in 1993 and 1994, and in 1994 he resided in a Drexel University fraternity house, Tau Kappa Epsilon.
Johnathon E. Briggs, Greg Garland and Walter F. Roche Jr. contributed to this article.
Autotote said it fired an employee and turned over evidence of "potential employee wrongdoing" to authorities investigating the case.
Autotote, a unit of Scientific Games Corp., of New York, did not disclose the name of the employee or details of the alleged wrongdoing.
"We are taking all necessary steps to resolve this matter as quickly as possible, and will continue to keep all authorities fully informed," Scientific Games Chairman Lorne Weil wrote in a statement.
He said the company gave the evidence it uncovered to the New York State Racing and Wagering Board and the New York State Police, which are leading the investigation because the bet was routed through a service in that state.
Stacy Clifford, a spokeswoman for the wagering board, declined to comment on Autotote's actions.
"The case is moving very well as far as we're concerned," she said.
Donald Groth, president of Catskill Off-Track Betting Corp., which took the disputed bet by phone, said he was told that Autotote fired an employee who worked in Newark, Del.
At Autotote's main office there, millions of dollars in bets placed by telephone, computer and simulcast networks are processed and forwarded to the tracks where the races are run.
Groth described the man as "a rogue employee" who had passwords that allowed him to enter the computer system and alter bets.
"This clearly is a major turn in the road," Groth said. "It was not the integrity of the system that was compromised, it was the integrity of a human."
The transactions under investigation concern bets made through Catskill by Derrick Davis, 29, of Baltimore. Davis picked the winners in six consecutive races at the Breeders Cup, a premier day of racing held this year at a Chicago racetrack.
In a key transaction, Davis wagered $1,152 on the Breeders' Cup Ultra Pick Six and was the lone bettor to select the winners, three of which were long shots.
His winning payoff - which has been frozen pending the outcome of the investigation - totaled $3,067,821.60.
Bets involving consecutive races are collated by a wagering service company according to an industrywide procedure designed to prevent strain on the system.
Catskill used Autotote, a leading tote company, to tally its customers' wagers.
The amount of money wagered on each race is immediately forwarded to the host track's system, so that odds can be calculated.
But the actual picks made by each bettor are not, in order to reduce the "data flow" into the computer.
After fourth race
Instead, only the picks of the bettors who selected the winners of the first four races - and thus are eligible to win the pot - are forwarded after the fourth race.
In the first four races, Davis bet only on the winning horse. In the final two races, he bet on every horse in the field.
This raised suspicions that the prior bets might have been altered in the computer after the races were run but before they were forwarded to the main computer that collated bets from around the world.
Davis, who operates a computer repair and installation business, has not responded to requests for comment from The Sun.
One source, who spoke on the condition of anonymity, said Davis has spoken with racing authorities in New York.
His attorney said yesterday that Davis has done nothing wrong.
"It is Derrick's position that he made a legitimate wager and he's concerned that there is a lot of speculation going on. He denies that he did anything wrong," said Steven A. Allen of Baltimore.
He declined to say whether Davis knows the fired Autotote employee.
"There is a process for investigating these types of allegations. It is early in that process. We're going to let that process go forward," Allen said.
"He understands the interest. He has the only winning ticket. We invite that scrutiny."
Groth said the initial investigation by Catskill reflected nothing other than a very lucky bettor who had also placed unorthodox - and losing - bets on the same day.
Yesterday, though, he said his opinion had changed with the new evidence uncovered by Autotote.
He said he has not seen evidence that Davis was involved in the alleged scheme. But it seemed improbable, he said, that an insider at Autotote would endanger his career and freedom to benefit someone he didn't know.
"Why would someone use their unique place in life to alter a bet for a complete stranger?" Groth asked.
A new account
Davis established his Catskill account a week or two before the date of the Breeders Cup, Groth said.
He told Groth that he is a regular at Laurel Park and Pimlico Race Course and he set up the account because he would not be able to get to a track to place the bets in person, Groth said.
If Davis is disqualified, then the winnings will be divided among more than 100 other bettors who picked five of the six horses, Groth said. Because they had won consolation prizes, they can be found by track officials using tax forms, he said.
Bennett M. Liebman, coordinator of the Racing and Wagering Law Program at Albany Law School of Union University, said it would be unusual for a Maryland player to bet through Catskill, which is the smallest of six off-track betting systems operated by various government entities in New York state.
Catskill offers a limited menu of tracks relative to larger and widely available systems, such as ones affiliated with the Maryland racetracks. (Davis has said that he found the Catskill site through a computer search).
Computer complications
Maryland law requires the use of a system based in Maryland or with a contract to a local track - requirements Catskill does not meet.
"I think it's extraordinarily suspicious," said Liebman, a former commissioner of the New York State Racing and Wagering Board.
Liebman said the proliferation of electronic gambling systems has increased the difficulties for regulators.
"In the old days you had a steward at the track who threw a switch and the betting was shut down. Now you have more and more electronic types of betting. It certainly has made it more complicated," Liebman said.
"The regulatory bodies are not ordinarily well equipped to control computer fraud," he said.
Someone caught changing bets in a tote company's computer system could face state and federal charges of fraud, as well as a federal charge of tampering with a sporting event.
Chris Sherf, executive vice president of the Thoroughbred Racing Associations, a trade group of racetracks based in Elkton, Cecil County, said its investigative unit is sharing information with law enforcement in the case. The group operates the Thoroughbred Racing Protective Bureau.
Sherf said he has never before heard of a case of alleged computer fraud such as this one. "Anytime where there is money there are people willing to cheat," he said.
Note in Highlandtown
Yesterday at a Highlandtown rowhouse in the 700 block of S. Baylis St. where Davis recently lived, a note posted on the front door read: "Dear Press, Derrick no longer lives here. I do not have a forwarding address."
A man who answered the door declined to identify himself or discuss what he knew about Davis, saying, "He asked me not to. He's just a very private person."
Last night in the 7900 block of Underhill Road, where Davis' parents, Tom and Vanessa, were welcoming trick-or-treaters to their Rosedale home, his father said he was excited that his son had come into some money and believes he did nothing wrong.
Davis hasn't lived with his parents at their two-story home since he left to attend Drexler University, they said.
Records show that Davis lived in Philadelphia in 1993 and 1994, and in 1994 he resided in a Drexel University fraternity house, Tau Kappa Epsilon.
Johnathon E. Briggs, Greg Garland and Walter F. Roche Jr. contributed to this article.