Betting machines may have had big handicap 

The maker of betting machines that allegedly ripped off gamblers at Bay Meadows and other racetracks has a history of fraud and may have known about the glitch in its quick-pick system, says a local lawmaker.

State Sen. Leland Yee, D-San Francisco-San Mateo, who called for an investigation by the state auditor this week, questioned the integrity of officials at Scientific Games on Wednesday.

The game-maker has an apparent history of defrauding bettors, said Yee, pointing to a report by the Horse Race Insider that details the 2002 arrest of Chris Harn, an employee of Scientific Games subsidiary Autotote.

Harn and two former fraternity brothers pleaded guilty to fraud after conspiring to rig the "pick-six" in the Breeders’ Cup in Illinois. The trio held the six winning tickets and stood to collect more than $3 million, but never collected, as Breeders’ Cup officials were alerted to the plot a day after the races.

The current controversy over the wagering system was uncovered May 3 at Bay Meadows, when a thoroughbred owner placed 1,300 quick-pick bets for the Kentucky Derby superfecta, in which the first four finishers must match the exact order of an individual’s ticket. The No. 20 horse — race favorite and eventual winner Big Brown — was not included in any of the 5,200 possible spots on the bettor’s ticket.

Scientific Games has claimed the mistake was the result of a computer glitch. Now, both Yee and the California Horse Racing Board, which is investigating the matter, want to know how long the company may have known about the problem.

In a May 15 e-mail obtained by The Examiner, CHRB chairman Richard Shapiro appears to inform Association of Racing Commissioners International President Ed Martin that Scientific Games was willfully committing fraud.

"It is egregious that this was known to Sci Games, and not disclosed to us or other parties accepting wagers in this manner," Shapiro wrote.

But on Wednesday, Shapiro said he didn’t mean to imply he had any evidence of fraud.

"I was not saying I had any knowledge it was known to them. That’s what the investigation will decide," he said.

tbarak@sfexaminer.com

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