The 2002 Breeders' Cup betting scandal was an incident that arose when computer programmer Chris Harn conspired with two friends, Derrick Davis and Glen DaSilva, to manipulate bets in the 2002 Breeders' Cup, held at Arlington Park in Arlington Heights, Illinois.
Harn was a computer programmer at Autotote, which handled the wagers for 65 percent of horse races in North America at the time.
[1] In the fall of 2001, Harn discovered unclaimed ticket data that if claimed, would total hundreds of thousands of dollars.
The three men had been friends and fraternity brothers at Tau Kappa Epsilon during their days at Drexel University.
Davis and DaSilva traveled to several tracks in New Jersey, New York, and Pennsylvania to cash the vouchers.
Harn discovered that there was a half-hour delay between the end of the second or fourth race and when the live wagers were forwarded—enough time to alter the results.
For the Breeders' Cup, Harn had Davis open an account at Catskill in case the authorities got suspicious of DaSilva.
After the fourth race, and half an hour before the Turf, Harn hacked onto the system and tracked down Davis' bet.
After having the Catskill techs reinsert the tape, he bet on every horse running in the Turf and Classic, assuring that he would win.
When Harn couldn't explain his activity or what he was doing at work in the first place, Autotote fired him and turned over the results of its own investigation to New York State and federal officials.
[1] Investigators soon discovered that Harn and Davis had been members of Drexel's Tau Kappa Epsilon chapter.
Not long after that, they discovered DaSilva had been a member of that fraternity at the same time as Harn and Davis, and also had an account at Catskill.
[2] On November 12, Harn, Davis and DaSilva were each charged with one count of wire fraud in White Plains, New York.
He not only admitted rigging the Breeders' Cup bet and the test runs he'd conducted with DaSilva, but also told investigators about his scheme to cash unpaid tickets—something they didn't know anything about.
[3] On December 11, DaSilva pleaded guilty to similar charges, but claimed he didn't know Davis was in on the scheme and that he took no part in the Breeders' Cup bet.
[11] The next day, Davis pleaded guilty to conspiracy to commit wire fraud and gave up all claims to the money.
It also pressured its member tracks into not doing business with parlors that didn't have the ability to record wagers taken over the phone.