NTRA Hires Giuliani Partners to Lead Review Process

20 November 2002

Additionally, the NTRA announced that it is launching a "systematic examination" of certain wagers over the past year with the goal of identifying whether there are areas requiring additional security measures.

The security and review process will be supervised by Giuliani Partners, which will work closely with the Technology and Security Risk Services unit of Ernst & Young. The NTRA retained Ernst & Young two weeks ago to begin an immediate security assessment, and related testing, of computer wagering systems related to horseracing.

"The addition of Giuliani Partners to the team will help in a variety of ways. Clearly, Rudolph Giuliani brings independence and credibility both to our review of past wagers and our commitment to future improvements," said NTRA Commissioner Tim Smith.

Mayor Giuliani said, "Thousands of fans wager everyday on horseracing across the country and should be confident with the knowledge that their wagers are being handled in a secure fashion in an honest system. The NTRA should be applauded for its immediate response in rallying racing leaders to review the security of electronic wagering systems and to maintain the confidence of its consumers. I look forward to working with the leaders of the racing industry to develop new safeguards for one of America's most popular sports."

Using information assembled by Equibase, the industry's data provider, the NTRA and its member tracks will examine pick 4, pick 6 and similar wagers meeting criteria going back to the beginning of the year. Initially, the focus will be on paperless transactions.

Participating tracks, including those affiliated with Churchill Downs, Inc., Magna Entertainment Corp. and the New York Racing Association, will analyze, among other things, any unusual circumstances in the make-up of the wagers examined. Assisting in this process will be the Thoroughbred Racing Protective Bureau and Ernst & Young. While higher-dollar payoffs will receive more scrutiny than others, all will be subject to analysis by random review.

Any specific questionable or suspicious cases will be referred by the track involved to the appropriate state regulators. The main purpose of the examination is to identify pertinent information that will assist the NTRA Working Group and Giuliani Partners in planning and recommending necessary or advisable steps to improve wagering systems security.

"This step is a logical expansion of the aggressive process being undertaken by the Technology Working Group," said Smith. "It responds to the concerns of fans and may well provide additional information helpful in strengthening security systems. We are determined to learn everything necessary to assure the pari-mutuel system's integrity and protect our customers' interests," Smith concluded.

The NTRA Board approved, at its meeting yesterday, a contribution for the creation of the Wagering Integrity Alliance, which will help fund the current assessments, design of future wagering security improvements, public communications aimed at strengthening customer confidence in pari-mutuel wagering and related matters. The Wagering Integrity Alliance will include other organizations, businesses and individuals committed to systems security improvements in connection with pari-mutuel wagering on horse racing. The purpose of the Alliance is to offer all industry stakeholders the opportunity to participate in the process of improving wagering security.

"The formation of the Wagering Integrity Alliance shows that the industry is united and fully committed to meeting this challenge. With this kind of continued support, we can make the necessary changes and emerge from this situation stronger than ever," said Smith.

The NTRA is a broad-based coalition of horseracing interests, including the American Quarter Horse Association, charged with increasing popularity of horseracing and improving economic conditions for industry participants. The NTRA and Breeders' Cup Limited also conduct the Breeders' Cup World Thoroughbred Championships, Thoroughbred racing's year-end Championships consisting of eight races and $13 million in purses and awards, the Breeders' Cup Stakes Program and the Great State Challenge. The NTRA has offices in Lexington, Ky., and New York City. NTRA press releases appear on the NTRA Web site, ntra.com, and at the Web site for the Breeders' Cup World Thoroughbred Championships, breederscup.com.

Giuliani Partners LLC, is an alliance of former New York City Mayor Rudolph W. Giuliani, a number of his senior executives, and Ernst & Young LLP, a global leader in professional services. Giuliani Partners assists chief executive officers in securing the future of their firms by protecting their knowledge, financial and physical assets, their people and their brand.

With Mr. Giuliani as chairman and CEO, the firm draws upon its experiences and expertise in innovative financial management, public safety, emergency preparedness and leadership during crises. This team includes New York City's former Police Commissioner Bernard Kerik, as well as other former city officials. Coupled with the broad-based expertise and global resources of Ernst & Young in the areas of assurance, risk management, information security and financial restructuring, Giuliani Partners provides clients with a comprehensive set of solutions addressing critical concerns of major corporations today.