As is the case with most of you, I would like to know more about exactly what the so-called "computer geeks" are doing.

I can guess at what they are doing and, if my understanding is correct (I don't know if it is), then you have to admire them for developing a clever, winning process that is entirely within the current rules.

I don't think they are doing anything that "guarantees" a profit on every race or that magically finds true "underlays" but I do think they have found a system that gives them an edge.

It sounds like some of them focus on exactas and they find "underlays" in the way a few others mentioned. That is, they assume that in the typical race the pari-mutuel win odds reflect pretty closely the true odds for each horse. They then look at the exacta payoffs and using a computer program (that assumes an algorithmic relationship between the chance of winning and the chance of being in the exacta) to find which exacta payoffs are underbet relative to the win odds. You and I could do this as well but without a computer it is very hard to do it for all the possible exacta combinations in the last few seconds just before wagering closes. It is even harder then to make a bunch of bets on all the overlays before the bell and it is even harder still to figure out how much you can bet (these guys obviously bet a lot) and not completely washout the overlay you are betting into (every dollar you bet will lower the effective odds).

Unless you have special direct computer access, you could not possibly do this. A few have such access. Most do not. Still it is not illegal and it does not “guarantee” a profit. There is no way you can guarantee a profit unless you are cheating (which direct access to the computer may help facilitate but that is another issue) but if the assumption that the public win odds provide a good indication of true exacta odds and that the public is sometimes inefficient in betting exactas because of the complexity involved, then you will show a long-term profit assuming that your edge plus your rebate exceeds the take.

If what I described is what is happening then you have to applaud them for maximizing their edge completely within the rules. They did not make the rules, they just figured out how to win within them.

I would agree this may be unfair to most and maybe the rules should be changed to prevent or mitigate this advantage that a limited few now enjoy but I certainly don't blame those who have taken advantage of the circumstances.

Where I get concerned is if they are getting access to pool info in other exotic pools that are currently completely hidden to the public (e.g., trifecta, superfecta, pick-3, pick-4, etc.). In my opinion, this would cross the line between being clever and cheating. It is one thing to try to optimize the way you work with the information that is available to all. It is another to be privy to information that others are not allowed to see. Imagine if only you could see the trifecta payoffs or Pick-3 payoffs prior to post? That would be huge advantage. I am not saying this is happening but what would stop those with direct computer access from getting such info?

The other place I get concerned is the Pick-6 scam angle. With direct computer access who knows what clever ways the computer “geeks” might devise to past-post bets.

One final note regarding offshore bookmakers. The current buzz is that these guys are now laying off money through the rebate shops as a way to hedge.

I thought the NTRA report was pretty well done. However, the one recommendation about creating some sort of "lottery" in the pari-mutuel pool was pretty silly. If I want to buy a lottery ticket, then I will buy a lottery ticket. I sure hope that one never takes off...

Chris