The alleged attempt by two computer experts to rig the Breeders' Cup Pick Six was one of the biggest, most audacious coups in the history of racing. But it was by no means unprecedented.
The events of Oct. 26 are similar in many ways to a scam that took place at Miami's Flagler Greyhound Track in the 1970s. In both cases, the perpetrators managed to enter wagers after races had been run. In both cases, they were employees of Autotote, the company that processed the bets. And in both cases, the cheaters were ultimately tripped up by their own greed.
Computer technology at the nation's tracks was relatively primitive in 1974, when Jacques Lavigne was working in the mutuels room at Flagler. Lavigne had spent his life around horse and dog tracks and he had larceny in his heart; he wondered if there might be a way to exploit a new wager called the trifecta. Because probable odds on the trifecta weren't posted on the tote board (as they were for win and quinella bets), the public wouldn't know if a payoff dropped because a bet was entered after the race was run. Could it be done?
Lavigne sounded out William Deal, Autotote's computer manager at Flagler, and found him a willing accomplice. They concocted a way they believed would beat the system.
After a race was run, the computer would normally indicate the number of winning tickets and then calculate the payoff. If there were four winning tickets and $10,000 to be distributed, each would pay $2,500. But with the flip of a few switches -- a process that took little more than half a minute after the greyhounds had crossed the finish line -- Deal could make the computer say that there was a fifth winning ticket and that the payoff was $2,000.
The victims of the fraud -- the people cashing $2,000 tickets -- would have no idea they were being cheated. At the end of the day, the collaborators would print out the fifth winning ticket. If it was worth more than $600, requiring the completion of an IRS tax form, they would pay a confederate to cash it.
In contrast to the Breeders' Cup bettors, who tried to make one great score that would have been worth $3 million, the Florida sharpies were trying to take home the track, brick by brick. There wasn't enough money in the Flagler pools to permit a single massive score, but the cheaters executed their scam race after race, day after day, year after year, on matinee and evening cards. When Deal left his job, Lavigne found new allies in the mutuels operation, the money kept rolling in -- and the money started attracting attention.
The wife of one of Lavigne's collaborators was having an affair, and she told her lover about the cash from Flagler. "The track got an anonymous call about shoeboxes full of money," recalled Fred Havenick, Flagler's current president. "We turned the information over to the state immediately."
A state investigator named Martin Dardis was put on the case. He was baffled until he started studying IRS forms linked to big trifecta payoffs, and saw that one bettor had cashed more than $150,000 worth of tickets in a short period of time. Dardis confronted the winner and from him obtained the name of Lavigne. The conspiracy began to unravel.
Five men went to jail, with Lavigne getting a five-year term. He alone refused to cooperate with prosecutors or make restitution of any of his winnings.
In a Sports Illustrated article about the coup, author John Underwood related that the investigator suspected that Lavigne had stashed away so much money that he was willing to give up five years of his life to keep it. Dardis visited Lavigne in the prison where he was serving his time and asked him flatly: "Did you make a million, Jacques?"
Lavigne replied: "All of us? More -- closer to two" million.
The cop told the crook: "Let me tell you where you blew it, Jacques. You got greedy. All you had to do was keep the tickets under $600. I'd never have caught you. Once you started filling out [IRS] forms, you left your mark."
"Yeah, I know," Lavigne said.
If the cheaters had created phony tickets on smaller trifectas, and collected cash without filling out any forms, the scam might have gone on indefinitely. They were undone by their own carelessness. A quarter-century later, this is what most people believe about the Breeders' Cup fraud.
The evidence indicates that Derrick Davis of Baltimore placed a Pick Six wager by phone and that Autotote employee Chris Harn cracked into the computer system and altered the bet after four races had been run. The scheme might not have provoked a national uproar if the bets had been more intelligent. Davis's ticket had the first four winners cold, followed by all the horses in the final two races -- an utterly implausible bet. (If the ticket had been larger, using two or three horses in some of the first four races, it would have been believable.) Davis compounded this mistake by playing the Pick Six in a $12 denomination instead of $2 -- another action that generated immediate suspicion. As with their predecessors a quarter century earlier, Davis and Harn got greedy and careless.
Perhaps it is in the nature of many scam artists to become overconfident, complacent and greedy, but surely some of them are smart enough to be cautious. And this suggests the most intriguing question rising from the recent Pick Six fix. If wise guys could figure out loopholes in computer systems at Flager in the 1970s and at the Breeders' Cup in 2002, how many others have pulled off similar acts in the intervening years? Were some of them judicious enough in their larceny that they never were detected?