Tote Inquiry (Hansard, 4 February 1980)

§ Mr. Whitelaw

I am grateful to Mr. Aglionby, a recorder of the Crown Court, for carrying out this inquiry into the Horserace Totalisator Board's procedures for the inclusion in its on-course pools of bets made off the course. In the course of his inquiry Mr. Aglionby received full co-operation from the Tote. He also had the benefit of a special audit carried out by Messrs. Deloitte, Haskins and Sell. His findings are as follows:

1. The various transmission procedures operated by the Horserace Totalisator Board ("The Tote") did not involve any breach of any statutory provision or of the common law.
2. The transmission of bets before September 1977 was conducted properly.
3. The procedure for transmitting to the relevant pool bets laid off by Tote Credit Limited, one of the Tote's bookmaking subsidiary companies, during the period from the 1st September 1977 to the 17th July 1979 permitted the inclusion of such bets after the result of the race was known, on the basis that such bets embodied decisions to lay off taken before the start of the race. This put Tote Credit Limited into a uniquely privileged position. Although this procedure was intended to protect the company when, through no fault of its staff, bets could not be transmitted to the course before the start, no other person on or off course could bet in this way. It was unfair that this distinction should be made.
4. Bets laid off by Tote Credit Limited were normally transmitted before the start of the race. However, difficulties arose unexpectedly in telephoning to the course and contact was sometimes not made until after the start of the race. Some bets transmitted after the start and indeed after the result of the race was known embodied genuine forecasts. It is not possible to give reliable figures for the numbers of bets embodying decisions revised after the start of the race, where there were difficulties in telephoning, but they were probably infrequent. This malpractice took the form usually of omitting losing money which normally would have been transmitted before the race. The amount of winning money was not altered.
5. An unacceptably high incidence of clerical errors in collating the bets for the Dual 2 Forecast Pools led to the introduction of a recheck of bets if the dividend to be declared was exceptionally large. Advantage was taken of this recheck by some employees of Tote Credit Limited to transmit to the pool further bets which bore no relation to the bets received from clients and which were intended to reduce artificially the dividend. This improper practice did not occur before the end of August 1978. 15 out of 697 Forecast Pools examined by Messrs. Deloitte, Haskins and Sell were certainly affected in this way and in each case the dividend was reduced by a very large amount. A very few additional forecast pools may have been improperly affected in this way without the dividend being dramatically affected.
6. Bets laid off by outside bookmakers for inclusion in the pool were placed with Tote Credit Limited as agent for the Tote for onward transmission to the course after the result of the race. The opportunity existed, therefore, for this procedure to be abused by the staff of Tote Credit Limited. It was abused because not all losing bets were put into the pool. 6 out of 995 Win Pools examined were affected in this way.
7. These various malpractices did not arise out of a desire for personal financial gain and no individual in the Tote or in its subsidiary companies benefitted thereby. The abuses arose out of misplaced enthusiasm by some employees of Tote Credit Limited who took improper advantage of opportunities presented to them believing that it was in the Tote's interest to depress dividends. High Forecast Pool dividends are in the Tote's interest but this was not appreciated by those employees who were all experienced in starting price betting practices and applied them to pool betting.
8. Of 1,635 Place pool dividends examined, 2 late transmissions were noted. One occurred after the start of the race concerned and the other after the result was known but this second late transmission was probably innocently delayed. The Daily Double and the Daily Treble pools examined were all properly conducted. Indeed, the inclusion of off-course bets tended to increase the dividends. Jackpot and Place pot pools were also fairly conducted.
9. There were a number of instances of errors in transmission revealed but these can fairly be attributed to innocent human error which is inevitable from time to time, given the size of the business conducted and the speed required to conduct it on busy race days.
10. Since the 17 July 1979 all bets must be transmitted before the start of the race. This procedure is entirely fair.
11. In practice, therefore, the overwhelming number of transmissions have been made fairly, but certain procedures were open to abuse and were abused. That situation no longer exists.
12. Those involved in these various abuses were all employees of Tote Credit Limited. The Chairman of the Board of the Tote, the members of the Board, the Chief Executive and other senior officials were ignorant of these abuses.

The Horserace Totalisator Board accepts these findings, but has pointed out, in regard to paragraph 3, that the privileged position held by Tote Credit Limited was also held by its predecessors—the Tote Board and its subsidiary Tote Investors—from 1962 to 1977. The board is considering the position of the staff concerned. On 17 July last the Tote altered its procedures so that transmission of bets after the start of a race ceased for all pools except the jackpot and the place pot. Mr. Aglionby has examined the present procedures and is satisfied that they are entirely fair. The chairman of the board has also assured me that all necessary steps have been taken to ensure that the staff adhere to the new procedures. They are based upon time-stamping and photographing of original documents, tape recording telephone conversations between the course and the Tote's London racing room and continuous audit of all transmissions by an outside security firm.

Mr. Aglionby's findings refer to a number of occasions on which Tote dividends were improperly reduced. The Tote is today publishing full particulars of those occasions and is announcing that it will be prepared to make good the losses incurred by any persons who can prove that they had these winning bets, whether on or off the course.