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#1
09-08-2006, 03:29 PM
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How about the guy who has a verbal contract that says he gets a breeding right for any horse he buys the client who becomes a stallion. Guy sells the horse as a sire to interests in another country for a chunk of change. Agent says he wants the cash equivalent of a breeding right because the horse was sold. Client with a straight face tells him that the agreement was a breeding right and since he doesnt own him anymore that hes not entitled to anything? Yes, this has happened. 
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#2
09-08-2006, 03:34 PM
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#3
09-08-2006, 03:49 PM
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I've got an interesting auction story. A friend of mine, who's father is in the breeding side of the business, wanted to buy a yearling. He wanted something by a freshman sire who he thought would run well at a low cost.
So, he heads up to the auction with his personal trainer acting as agent and finds a very nice filly. Turns out the one the agent/trainer likes was bred by his father. She was consigned through a independent party. Good news for my friend since he can just call and ask if she has had any problems. He does, she hasn't and he bids. He lands her for X dollars. The next day his agent/trainer gets a call from the consignor saying he has someone who'll give 2X dollars for her. Needless to say where was this mystery buyer the day before. My friend tells his father and needless to say the consignor won't be getting anymore business from my friend's father. These and other shady things happen at sales, especially if one slips through the cracks at a low price. I even know of consignors who have purchased from their own consignment through a third agent if the price was right.
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#4
09-08-2006, 04:14 PM
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#5
09-08-2006, 04:18 PM
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What the hell is the matter with that? They should have fallen to their knees and thanked the guy for doubling their money in one day. I don't see a thing wrong with that on either side. Many times a guy will have a client who says I like horse number "123" in the book, what do you think he will go for? Agent says, that one oughta go for about 400 grand. Guys says thats too much for me. So they don't even bother trying to bid. The sales results come out the next day and number "123" sold for 180 grand. Client says geez, I woulda gone to 250 on him. So they call the buyer and often times the horse is flipped on the spot. Everyone should be so lucky!!!
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#6
09-08-2006, 04:22 PM
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#7
09-08-2006, 04:26 PM
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Could be wrong, but that's how I read it.
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#8
09-08-2006, 04:35 PM
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#9
09-08-2006, 04:38 PM
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I might add that the reason people use agents in private sales and buys is time. Most owners don't have the time or the know how to watch a zillion races a day, nor do they want to. They figure if they hire someone to do it, that its worth a small percent.
By the same token agenst are often used to sell horses, especially brrodmare and sire prospects. Owners simply have too many other things going on in their lives to do that. it involves making a lot of phone calls and contracts and haggling, etc. So they just tell someone how much they want for a horse and let them do what they consider to be nuisance work for a percentage.
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#10
09-08-2006, 05:12 PM
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The biggest problem with horse auctions lies with the autions themselves. The fact is that you do not even have to be registered to bid on a horse nor does the sales company even keep track of the bids outside of the final one. As a matter of fact the bid spotting process often leads to phantom bids being accepted such as a case where two bid spotters call out the same bidder. But in an unregulated forum that the auctions are cheating and fraud are unusually easy to accomplish.
I think its important to understand that very rarely are all bids live. Most of the time a consignor will assign a Reserve price and then have an agent bid the horse up to right below the price. So the unknowing bidder is actually not bidding against a live buyer, he is said to be bidding against the reserve. Being that you dont know what the reserve is beforehand sometimes the consignors agent will play a little russian roulette by continuing to bid past the reserve, known as running the bid up. This is a fact of life in the auction game like it or not. Often the sale is a bogus one such as when Scipion was sold at Saratoga a few years ago. Bred by Mrs. Payson, he was purchased by P. Biancone, agent. He ran and continues to run as the property of Mrs. Payson. There was no actual sale but he was showcased in the Bloodhorse as the sales topper. All of these things and the other little issue raised by mattress mac could be eliminated if the sales companies would sell horses like art is sold, numbered, registered bidders. the bids could be tracked and recorded so when there is a problem like this there would be a record of who bid on who. Considering the fact that a billion dollar business is so unregulated it is shocking hat it has taken so long for cases like these to be unearthed. Also all agents that are given bidding privilidges should be licensed and subject to loss of license if found guilty of fraud. But, alas it wont happen because that would decrease the price of horses therefore decreasing the profitability of those in charge of this sport, the breeders, consignors, and sales companies along with several powerful agents and trainers. Funny thing about this business is that all the things that would make the sport (racing) healthier like dropping averages at the sales are thought to be horrific to the Lexington and Ocala crowd who really are the profiteers in this industry. Like Joel said if prices keep going up and expenses keep going up and scandals (sales and drugs) keep popping up and purses are stagnant, then how long until the bottom drops out?? Despite the press we could all get along very well without The Arabs, Coolmore and Storm Cat.
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#11
09-08-2006, 04:38 PM
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#12
09-08-2006, 04:42 PM
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it is amazing that people are so shocked by this type of thing. all of the top people in this business cheat and lie. drugs are rampant too. horse racing is no different than baseball, cycling, track & field, football, etc. cheating and lying are in every sport where there is money. it is amazing people think these businesses are honest. if you don't cheat in some way, you will never get to the top. some honest guys have the occasional horse, but the guys consistently at the top are the best cheaters.
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#13
09-08-2006, 04:47 PM
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o80, rupert, c-ham... thanks for the insights. Most of my assumptions were wrong. Goes to show to do business only with people you trust and then do so carefully. TY again.
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#14
09-08-2006, 04:55 PM
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If Cashman embezzled money from the Yankees he could be booked for it and face jail time, yet when an agents basicaly steals $95,000 from a horse owner he works for - he just gets suied over it.....
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#15
09-08-2006, 04:01 PM
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I get a referral for a 90 employee firm. I put a new plan in place, saving the guy $150k (Ann premium down from $750k to $600k). My end is 4% of $600 or $24k. I'll get paid by Humana. I had about 150 hours in. One week after it goes live, the guy names his nephew his "new consultant." I get nothing. Zero. It's been 10 months. I get a call from the guy. The whole thing is f'd up. The nephew's an idiot. Asks me if I'll work on it again. I told him yes, but he had to pay me $15k in advance every 6 months and I'd take zero from Humana. I sent him a contract. Haven't heard back. I am not holding my breath. I know it happens, believe me I know.
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