Missing the Point
Some reactions to the Murray Rojas verdict and the NHBPA’s legal support are off-base
By Rich Halvey 

By now, everyone should have read about the case of Pennsylvania trainer Murray Rojas, who was convicted of 14 counts of misbranding animal drugs in violation of federal law but found not guilty of seven counts of wire fraud. the outcome was certainly a mixed bag. Prosecutors didn’t get a conviction on the most serious charges, and Rojas still faces punishment for the misbranding convictions.

But this opinion article is not about whether Rojas did it or deserved it or was singled out in some way. frankly, given all the testimony, something stunk over at the Rojas barn, and she perhaps could have done a lot worse than a conviction for misbranding.

Let me be clear — this is not about defending Rojas or anything she did that got her in this mess in the first place.

Rather, I want to talk about two things: a federal overreach in terms of the prosecution of wire fraud and some shots taken at the National HBPA by racing writer Ray Paulick of the Paulick Report. Let’s start with the wire fraud.

According to the website legaldictionary.net, wire fraud “may be committed using interstate wires, television or radio communications, or the Internet” in order to defraud someone. In Rojas’ case, purse money in the races her horses contested was paid by an interstate electronic transfer of funds, and the interstate aspect was enough to trigger federal jurisdiction. But make no mistake—if the feds wanted jurisdiction, they had to find a violation of a federal crime, and overages in racehorses of veterinary medications haven’t made it into the United States code. So, they had to get creative and decided on wire fraud.

When the first mail fraud act was passed in the late 19th century, there was a proliferation of get-rich-quick schemes and shady land deals, usually promoted by city slickers to separate rural rubes from their money. Fleecing someone was a crime, but the federal government cleverly made fleecing someone through the mail a whole other crime. The obvious extension of the mail fraud law was to make wire fraud equally illegal. This originally covered the telegraph and the telephone but eventually included communication through landlines and “wireless” communication, including cell phones and the Internet.

These federal laws are pretty handy when authorities are targeting substantial crimes like racketeering and money laundering but certainly more of a stretch for something like paying the winner’s share of a purse with a check from an out-of-state bank, especially when the “fraud” was ostensibly gaining an advantage by illegally dosing medications. I suppose you can argue somebody got defrauded—perhaps the connections of the second-place finisher and the people who bet on that horse to win—even if it was only indirectly. Of course, it would seem that by the letter of the federal law, if Rojas had committed the same offense at Parx Racing, she wouldn’t have been charged with wire fraud because the bank used to pay the purses at Parx is located in Pennsylvania.

That raises the question, if an act at one track can be considered federal wire fraud and the exact same act at another track wouldn’t be considered federal wire fraud, were the feds overreaching when they charged Rojas with wire fraud? And it further makes one wonder whether the federal fraud statute was appropriate as the primary law enforcement tool for dealing with therapeutic medication overages at racetracks primarily governed by the state they are in. Often the breadth of how the law should apply becomes a function of the creativity of the prosecutor. Even so, do we really believe the Congress of the United States actually anticipated the wire fraud law to apply in cases like that of Murray Rojas?

After reading an editorial from Ray Paulick in which he speculated on the motivations of the NHBPA in this matter, I spoke with Eric Hamelback, the CEO of the NHBPA, about why the horsemen’s association contributed to Rojas’ legal defense. Hamelback was very clear that the NHBPA’s financial support was not about “enabling,” as Paulick suggested, the kind of violations of which Rojas was accused. It was because the NHBPA was legitimately concerned that if the wire fraud charges stuck based on getting a purse distribution check from an out-of-state bank, then there was no violation that couldn’t be considered wire fraud, at least at tracks where purse checks were drawn on an out-of-state account. In a sense, the feds were looking to make a new law with regard to violations of drug/medication thresholds. Overage of ranitidine? Overage of phenylbutazone? Both could be considered wire fraud based on the thinking of the feds with regard to Rojas. Whether or not everyone in the industry agrees with the NHBPA’s position, it seems clear that the association had a legitimate concern, not “preposterous scaremongering,” as Paulick suggested. It takes very little imagination to stretch the decision the feds made on wire fraud to include any violation that results in a purse being fraudulently paid.

Hamelback was direct in saying that the NHBPA has always been in favor and supportive of penalizing those within the racing industry who break or abuse racing’s regulatory rules, and while there are some who won’t see any difference between defending Rojas from an overreaching federal government and defending Rojas’ actions to try to gain an edge, the NHBPA’s position was not an attempt to find ways of having trainers like Rojas wiggle out from underneath punishment for the misuse of therapeutic medications.

Even if you believe that some states have done a less-than-sterling job of cleaning up racing, you have to ask yourself if the answer is federal prosecution for wire fraud. There will certainly be an element that agrees with Paulick when he says:

“I understand why enablers like [Todd] Mostoller [of the Pennsylvania HBPA] and Hamelback rejoiced when the jury found Rojas not guilty on seven counts of wire fraud and conspiracy. They are hoping the FBI will turn tail and let horse racing return to policing itself. They must believe the status quo was working just fine before the feds showed up. And maybe it was, for the cheaters and crooks, but not for honest horsemen, and certainly not for the betting public. This is a shameful chapter in the history of the HBPA.”

Those who do agree with that statement miss the point just as Paulick did. Even if the NHBPA was pleased that the decision on wire fraud went its way, to imply there was some sort of sticking-it-to-the-fans rejoicing at the NHBPA office over the decision was ridiculous. The characterization that this was somehow part of an NHBPA effort to enable scofflaws to get off the hook is plainly off-base.

The NHBPA believed the feds had overreached when they applied the wire fraud statute, and it turns out that based on a jury composed of regular people they were right. The message was not that the FBI should turn tail but that you charge trainers with the appropriate crime and adjudicate it in the appropriate jurisdiction, and if they are found guilty, you give them the appropriate punishment. Paulick made the classic mistake of conflating a stance on a point of law with carte blanche support for the alleged lawbreaker. To use the word shameful is not even close to the NHBPA’s position on Rojas.

Paulick could have done his due diligence and talked with Hamelback (as I did) about the Rojas decision, and he would have found out what I did.

He also could have stayed to the end of the trial instead of leaving after the prosecution was finished presenting its case, and perhaps that would have given him a complete perspective on why Rojas chose to fight the wire fraud charge. Instead, he chose to attribute to the NHBPA feelings (rejoicing) and motivations (covering for violators) that were off the mark. If the NHBPA was satisfied with the verdict, it was because no other trainer will have to worry about a federal felony for any overage of a legal therapeutic medication.

If Paulick and others believe the states have proven themselves incapable of standing up to the horsemen, there are plenty of steps they can take before settling on creative federal prosecution. For one thing, they could get people on racing commissions who know what they are doing, spend a lot more time on proactive enforcement of the rules and don’t have close personal relationships with the people they are supposed to regulate. But you can be assured the Murray Rojas situation could never have proliferated if the stewards and the racing commission had been more vigilant. Pennsylvania regulators are as much to blame for the involvement of the feds as the problem trainers are.

There are some in the industry who would advocate in favor of putting the feds in charge of racing—this regulatory overreach notwithstanding—but a much better answer would be to try to make the current system work the way it is supposed to.

Rich Halvey is a professional turf writer and handicapper living in Denver, Colorado. He has been a horse racing fan for more than 45 years. You can read his opinion pieces and handicapping articles on his website at halveyonhorseracing.com.