HRI chief accuses IBA of reckless behaviour

THE Irish Bookmakers’ Association has been accused of “behaving recklessly” after it emerged its allegations of financial irresponsibility against Horse Racing Ireland were based on a report that according to its authors, was not an appropriate foundation for such claims.

Risk management partner of accountancy firm KPMG, Conall O’Halloran, has revealed in a letter to HRI chairman Denis Brosnan and IBA chairperson Sharon Byrne, that the company’s work, commissioned by the IBA, was not a “forensic assessment” of the HRI’s finances as the IBA had claimed and thus should not have been used to draw any conclusions.

In what amounts to a public censure to the IBA which is sure to cause huge embarrassment, the bookies’ association has been told that it is to “cease and desist” from using the report to make its allegations.

The IBA issued two press releases last week calling for a government investigation into the HRI’s finances “as a matter of urgency”, after KPMG’s report had shown a massive increase in expenditure between 1998 and 2008.

These claims were made despite the fact that the report was, in O’Halloran’s words, “heavily caveated on the basis of its sole purpose being to identify variances for further analysis”.

O’Halloran confirmed that the analysis did not take into account the restructuring that took place in the horse racing industry in 2001.

“Accordingly, it is evident that the restructuring is likely to be a significant contributory factor in explaining and rationalising the identified variances” continued O’Halloran.

“On this basis, the preliminary analysis set out in the report, the intended purpose of which was to assist IBA in seeking to understand these movements, was not in our view an appropriate basis for the conclusions drawn and commentary issued by IBA.”

The letter continues by explaining that the report had been carried out on the basis that it was not to be “distributed, copied, circulated or referred to… in correspondence or discussion with any person without our prior written consent” and that consent had not been given for the purpose in which IBA had used it.

This, wrote O’Halloran, led to the report being “widely misrepresented”. He emphasised that the analysis did not express any view on whether or not HRI’s spending had been appropriate, excessive, or as Sharon Byrne had suggested “out of control”.

Responding to KPMG’s letter, HRI chief executive Brian Kavanagh was highly critical of the IBA’s actions and motivations.

“The IBA has behaved recklessly in their misuse of the KPMG analysis. The IBA used flawed and meaningless figures in a defamatory campaign against Horse Racing Ireland and the Irish racing industry.

“The real motive behind this activity is the question of betting tax. All parties need to work with Government to secure a reasonable return from betting tax and to ensure adequate funding for horse and greyhound racing.’’