Class-action allegations over US betting edge for insiders
A federal class-action lawsuit in the United States is targeting some of the country’s most powerful horse racing operators, accusing them of colluding to give high-tech betting insiders an unfair advantage over ordinary punters.
Filed on 24 October in the US District Court for the Eastern District of New York, Ryan Dickey v. Stronach et al. names racetrack owners The Stronach Group, Churchill Downs Inc., and the New York Racing Association, alongside United Tote Company, Racing and Gaming Services, and two computer-assisted wagering (CAW) platforms – Elite Turf Club LLC and Velocity – linked to the tracks.
The complaint alleges that these entities created “a rigged system” using computer algorithms, artificial intelligence, and preferential access to manipulate wagering pools, transferring billions of dollars from retail bettors to a small circle of insiders.
Filed by the law firm Hagens Berman Sobol Shapiro LLP, the suit cites violations of the Racketeer Influenced and Corrupt Organisations Act (RICO), as well as claims of unjust enrichment, conspiracy and conversion.
Hagens Berman managing partner Steve Berman described the conduct as “a modern reverse-Robin Hood scenario”, saying racetrack operators and favoured betting groups were “stealing from average public retail bettors and giving to the already rich”.
The lawsuit argues that technological advances have transformed pari-mutuel wagering into a system dominated by data-driven players with exclusive access.
According to the complaint, CAW groups use sophisticated algorithms to scan odds and place large, rapid wagers through direct connections to betting pools.
Ordinary punters, in contrast, must place bets through slower online interfaces, often receiving worse odds by the time their wagers are processed.
Insiders are said to benefit from substantial rebates and reduced fees, allowing them to profit from narrow margins that would wipe out retail bettors attempting the same strategies.
