California Racing Board Warns Media Outlets

23 February 2002

Officials with the California Horse Racing Board (CHRB) are on a mission to educate the state's radio broadcasters and newspaper publishers on what is and isn't a legal betting operation in the Golden State.

The Board, which issued its third license for account wagering through the telephone or Internet on Thursday, last week made attempts to inform media outlets that there are a host of illegally run Web sites advertising through radio spots and print campaigns.

CHRB Executive Director Roy Wood explained that, as a regulatory agency of the State of California, the Board has an obligation to uphold laws and to stem the flow of illegal wagering dollars out of California. He said CHRB investigators are working with other state and federal law enforcement authorities to achieve this.

As part of the initiative the CHRB sent out an advisory notice to a pair of trade organizations representing the two media industries, warning them that they could be promoting illegal gaming activities by accepting ads from anyone other than the state's three licensed operators for advance deposit wagering.

The California Broadcasters Association (CBA), which represents every radio and television station in the state, distributed notices to its members advising them:

"Last week the California Horse Racing Board licensed two companies. You should only accept advertising for ODS Technologies (tvgnetwork.com) and XpressBet (xpressbet.com), a division of Magna Entertainment Corporation. All other forms of Internet and telephone gaming are still illegal! If you are running ads for sports betting, on-line gaming, or any other type of Internet or telephone gambling besides horse wagering for these two licensed entities, you are in violation of the law."

The California Newspaper Publishers Association, which represents virtually all of the newspapers in the state, included an item in its weekly bulletin to publishers, advising them of efforts to curtail advertising for illegal wagering services, and directed them to the CHRB for information.

Mike Martin, spokesman for the CHRB, said the advisors proved to be helpful.

"We are getting a good response in people wanting to know more about it," he said. "I don't know if it has resulted in people pulling any ads, but certainly there is a lot of interest in the issue."

While the CHRB is trying to funnel as much money into legal betting operations as possible, Martin said he isn't sure if it is illegal in California to accept advertising for Internet gaming. That, he said, is a decision that would have to be made by the state's attorney general.

He said the initial advisories weren't sent to put legal fear in publishing and broadcasting companies, but rather to make people aware of the situation.

"In the first go around here we are trying to work out cooperative arrangements," he said. "It would be counterproductive to start waiving laws, if there are any, against the practice."

Martin said the CHRB is open to what the next step in the process would be if the ads which it perceives to be illegal continue to be placed. Those plans, he said, haven't been discussed yet.

Stan Statham, president and chief executive officer of the CBA, admitted it has been hard for members of his group to keep track of what's legal.

"It has been impossible over the past two years for broadcasters to keep up with the dynamic changes in gambling regulation," he said. "We have been continually frustrated in our efforts to get revised guidelines from state and federal agencies. The broadcasters welcome clear and concise advisory notices, such as those offered by the California Horse Racing Board."

Despite the fact that Martin has been flooded with calls from both radio station owners and newspaper publishers wanting more information, he said the advisories served their purpose.

"Based on the calls that I have received, there are a lot of people out there that weren't really educated on the system and what was legal and illegal," he said.