If you have issues viewing or accessing this file contact us at NCJRS.gov. Union Calendar No. ! 93d Congress, 1st Session - - House Report No. 93 ORGANIZED CRIMINAL INFLUENCE IN t HORSERACING J A REPORT BY ~J [~HE SELECT COMMITTEE ON CRIME (.Created by H. Res. 2.56) TOGETHER WITH ADDITIONAL AND SEPARATE VIEWS .~E 25, 1973.--Committed to the Committee of the Whole House CO on the State of the Union and ordered to be printed 0 U.S. GOVERNMENT PRINTING OFFICE :. WASHINGTON : 1973 0 For sale by the Superintendent of Documents U.S. Government Printing Office, Washington, D.C. 20402 Price 75 cents domestic postpaid or 50 cents GPO Bookstore Stock Number 5271-00353 ¥ / SELECT COMMITTEE ON CRIME CLAUDE PEPPER, Florida, Chairman JEROME R. WALDIE , California CHARLES E. WIGGINS, California FRANK J. BRASCO, l~ew York SAM STEIGER, Arizona JAMES R. MANN, South Carolina LARRY WINN, JR., Kansas MORGAN F. MURPHY, Illinois CHARLES W. SANDM~¢N, JR., New "Jersey CHARLES B. RANGEL, New York WILLIAM J. KEATING, Ohio CHRIS NOLDE, Chief Counsel RICHARD P. LYNCH, Deputy Chief Counsel JAMES E. MCDONALD, Assistant Counsel ROBERT J. TRAINOR, Assistant Counsel MICHAEL D. PETIT, Research ~ICHAEL W. BLOMMER, Former Minority Counsel (II) O ,4 "= . LETTER OF TRANSMITTAL House oF I~.EPRESENTATIVES~ Washington, D.C, June 20,1973. Hon. CARL ALBERT, Spea]cer of the House o)¢ Representatives, Washington, D.C. ~ ,: DEAR MR. SPEAI~:ER : By direction of the Select Committee on Crime, I submit herewith the committee's report to the 93d Congress. The report is based on an extensive study made by the Select Committee on Crime. The conclusions and recommendations herein represent a con- sensus of opinion of the members of the committee, and each member does not necessarily agree with every conclusion and recommendation. CLAUDE PEPPER. Chairman. (rid PREFACE On May 9, 1977, the Select Committee on Crime of the U.S. House of Representatives convened the first congressional hearings spe- cifically intended to examine the extent to which sports and sports- 4 related activities were influenced by criminal groups. The chairman announced at that time the committee's public in- quiry would begin with an examination of parimutuel racing, by far the sport of greatest gate attendance and an increasingly important source of revenue for a majority of State governments. The committee planned to focus on other sports as well. However, as the hearings progressed it became apparent that the investigation of criminal activities in parimutuel racing alone was sufficient to keep the committee and its investigators active through the end of the year. The public hearings produce~d some shocking disclosures. These in- cluded a full revelation of the scandalous events that led to syndicate takeover of one racetrack and a near successful effort to secure a sec- ond; testimony by individuals that bribes were routinely made to racing commissioners and public officials in exchange for racing li- censes or favorable racing dates; sophisticated methods employed by small groups of unscrupulous individuals to fix races for high returns on modest investments, and the exposure of racing's Achilles' heel-- a small and inadequate security force in desperate need of in- creased manpower and authority to conduct unhampered interstate investigations. The committee offers this report and the recommendations contained herein as a call for Federal and State action to curb the activities of those who would corrupt a sport so much a favorite of the American people. (v) J CONTENTS Page • Letter of Transmittal ................................................. III l'reface ' V Race ~'ixing .......................................... -. .............. 1 Undisclosed Owners .................................................. 19 Political Contributions ................................................ 29 Hazel Park ............................... - ................. -~........ 35 Berkshire Downs ..................................................... 41 Jefferson Downs ...................................................... 47 Emprise Corp ......... " ............................................... ' 55 Funk/Emprise-Steiger Controversy in Arizona ............ _ ............. 64 Celehrites as Fronts .............................................. ___, 71 What Is Right With Racing .......................................... 79 Committee Recommendations ......................................... 79 Additional Views of: Congressman Morgan F. Murphy .................................. 86 Congressman Charles E. Wiggins .................................. 90 Separate Views of Congressman Jerome R. Wal4ie .................... 85 Statement of Congressman Charles B. Rangel ........................... 89 Appendix--~ Summary of Racing in America .......................... 97 (VH) Union CalendarNo. 154 93D CO~G~SS t HOUSE OF REPRESENTATIVES t No. ~RT93-326 1st Session ORGANIZED CRIMINAL INFLUENCE IN HORSERACING JUNE 25, 1973.--Committed to the Committee of the Whole House on the State of the Union and ordered to be printed Mr. PEPPER~ from the Select Committee on Crime, submitted the following REPORT together with ADDITIONAL AND SEPARATE VIEWS BASED ON A STUDr BY THE SELECT CO]~ITTEE ON CRIiY[E On June 20, 1973~ the Select Committee on Crime approved and adopted a report entitled "Organized Criminal Influence in Horse- racing." The chairman was directed to transmit a copy to the Speaker of the House. RACE FIXING Because horseracing and other forms of legalized gambling can affect the integrity of State government~ they should be the best policed of activities. We have determined that inadequate security at many thoroughbred tracks and harness raceways has led to race fixing which threatens not only the integrity of the industry in which the sport 6 , is sanctioned but that of the State itself. This committee has heard of schemes as simple in design as that of a dishonest jockey hoping an electrical charge applied to his mount will put hi.m into the winner's circle. 1 We have also heard of elaborate con- spn'aems m which an entire race was effectively tied up by knocking out half the field of horses with drugs. ~ 1 Hearings before the Select Committee on Crime entitled •"Organized Crime in Sports (Racing)" (hereinafter referred to as "Hearings"), testimony of Alexander MacArthur. pt. 2, pp. 527-528. Crime Committee Hearings, testimony of Bobby Byrne, pt. 3, pp. 1103-1139. (1) / 2 Fixed races have been discovered at both thoroughbred, or flat tracks, and harness raceways. What has come to public attention, we fear, are only the most flagrant examples of a significant problem which the industry chooses not to face due to its misguided desire to protect the image of the sport. We were pleased to find people in the industry willing and anxious to shed light on the activities of those who would further corrupt the sport and give examples of how the dishonest ply their trade at the tracks. One such forthright individual was Alexander MacArthur, a cattleman by trade, who in 1969 took charge of the Illinois Racing Board after one of the greatest racing scandals in history. As a result of this scandal, former Governor Otto Kerner, William S. Miller, former chairman of the Illinois Racing Board, and several other high-ranking government officials, were indicted following an 4" investigation of racing in Illinois2 We regret th'~t MacArthur and another witness .before our com- mittee, Racing Board Member Gerald F. Fitzgerald, saw the need to resign from the board last December, as a matter of principle, when a majority of the seven members reinstituted "gimmick" or "exotic" betting and awarded racing dates to the BMmoral Jockey Club of which indicted former Racing Chairman Miller maintained an interest held in trust. Gov. Daniel WMker of Illinois supported MacArthur's position by obtaining the resignations of what was left of the Illinois Racing Board. In MacArthur's all-too-brief term as racing board chairman, his willingness to examine the sport and root out undesir- able individuals and practices was commendable. ,d In their separate appearances before the committee, both MacArthur and Fitzgerald made numerous recommendations which we think are in the best interests of the sport. These include a full disclosure statute to determine who owns the tracks and the horses; the setting of long- term racing dates to avoid chaos and corruption at the statehouse ; the licensing of those engaged in horseracing; stringent penalties for fix- !! ing a race, and the establishment of a national data bank so that States know who has been barred from tracks in other States. Mr. MacArthur's lack of prior involvement in racing appears to have been a positive factor contributing to a fresh and courageous approach toward a job he said he accepted "hesitantly." "It very soon became apparent to me and the board," MacArthur said of the task before him in October 1969- that Illinois racing was long overdue in giving a complete and truthful account of itself to the board and thereby to the people of Illinois.. If racing were to survive .and grow in the fertile soil of Illinois, three truths had to be honored with sincere attention : 1. The fan and the honest horseman had to be assured that all races were clean and above board; and that the Illinois Racing Board, operating in full view of the public, would stand for no monkey business. 8 Hearings, statement of U.S. Rep. Morgan Murphy, pt. 2. p. 522. Several of these offi- cials have been convicted of bribery in connection