Damage Control: Betinternet Wants to Clear Its Name after Race Fixing Scanda

2 February 2005

Officials with Betinternet are hoping the New York Racing Association will reverse its decision to terminate a simulcast agreement with the company's Euro Off-Track subsidiary because of its involvement in a betting scandal spanning four years.

The U.S. Attorney for the Southern District of New York last month indicted 17 individuals involved in an alleged illegal betting ring headed by owner Gerald Uvari. Euro Off Track is cited in the indictment as doing business with the ring, but the company says that it has acted properly and that it actually played a key role in bringing the group to justice.

According to the indictment, Euro Off-Track maintained a betting account for the alleged gambling ring and transferred proceeds from unlawful wagering to partners in the group through an intermediary, Richard Hart, the general manager of the Lakes Region Greyhound track in New Hampshire.

Paul Doona, managing director for Betinternet, said that a $315,000 transfer from Euro Off-Track to the Uvari group raised a red flag, prompting the company to report the transaction to the NYRA.

Despite what Betinternet considers a good faith effort on the part of Euro Off-Track, the NYRA terminated its simulcasting agreement with the company as well as agreements with three other operations named in the indictment: International Racing Group Inc. and Elite Turf Club in Curacao and a phone center operated by the Tonkawa Indian Reservation in Oklahoma.

The New Jersey Sports and Exposition Authority, operator of the Meadowlands and Monmouth Park, also cut Euro Off-Track off following the indictment.

The 88-count indictment claims that the Uvari ring processed more than $200 million in bets over four years and used the four named operations to funnel funds. The defendants are accused of taking bets on horse racing and other sporting events, as evidenced by the results of a two-year probe.

The investigation was brought to light with the news of allegations that the Uvari Group in December 2003 fixed a race at Aqueduct in which trainer Gregory Martin allegedly treated a horse with a performance enhancing "milkshake." The race resulted in a form reversal and a 10-length, $5.60 win.

Because of Euro Off-Track's involvement, Doona is trying to clear the air with customers, investors and the simulcasting industry.

Doona wrote a letter to top NYRA officials, informing them that his company was a whistleblower in the investigation. He also offered the association complete access to Euro Off-Track's operations.

Doona is hoping Betinternet can sway the NYRA as it did Magna Entertainment. The same scandal prompted Magna to terminate its simulcasting agreement with Euro Off Track, but Magna restored the feed after Euro Off Track agreed to follow certain procedures.

Betinternet was supposed to have released its first-half results for the fiscal year, but has postponed that announcement to Friday in hopes that more facts can be presented to investors and analysts regarding the NYRA situation.

The company's stock price rose 1.37p on Tuesday to 8.62p following Doona's clarification of the company's role in the investigation.

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