INDIANAPOLIS – Officials involved in racing investigations for all three major horse racing breeds stressed on Thursday morning during panels at the Association of Racing Commissioners International conference that the most important benefit of successful prosecutions is driving “cultural change” in the sport. While the majority of the panelists were involved in Quarter Horse and Standardbred racing, representatives of all three breeds said that expanded investigative efforts have led to significant changes on backstretches where trainers are now more reluctant to act outside of the rulebook and more willing to provide information to investigators on potential rule violators. Carson Morris, a partner in a law firm that has been under contract with the United States Trotting Association to conduct investigations on rule violators since 2020, said that the initial efforts to go after rule violators started with “low-hanging fruit,” targeting people “who no one wanted in the sport, but who kept in it because tolerating these types of people had almost become routine.” Now, after several adjudications that resulted in participants losing their membership in the USTA, Morris said that opinions of the investigative unit have started to brighten. :: KENTUCKY DERBY 2026: Top contenders, point standings, prep schedule, news, and more “The kind of cultural change we were looking for is beginning to happen,” Morris said. “People, I hope, are starting to learn that it’s not worth it to associate with people who are not in good standing.” Naushaun Richards, the chief of investigations for the Horseracing Integrity and Welfare Unit, which enforces the rules and regulations of the Horseracing Integrity and Safety Authority, said that he sees the cultural shift most prominently in the number of people on racing backstretches who are willing to work with his teams. “The quickest way to [start an actionable investigation] is to have someone in the industry come to you and tell you what is happening,” Richards said. “It’s getting people to buy-in to becoming a source. Not just a source that will give you information, but a source that is willing to stand up, raise their right hand, and testify for you. And that cultural shift is happening.” Quarter Horse racing is currently going through an existential crisis – the first panel on Thursday was called “Saving Quarter Horse Racing” – due to dozens of high-profile drug positives in top races, the infiltration of criminal gangs into the sport’s owners and training ranks, and a variety of other issues related to both trends. But officials regulating the sport said on Thursday that efforts to crack down on drug use and paper trainers is demonstrating that the industry is serious about a crackdown, including the handing down of lengthy bans to some of the sport’s top trainers. Driving that crackdown was a cooperative effort between Quarter Horse regulators and the Racing Medication and Testing Consortium – a racing group most closely associated with Thoroughbred racing – to conduct research on testing methods for new beta agonists that were being abused in the sport, drugs like clenbuterol and albuterol that open airways and can build muscle mass when used regularly. Still, some in the Quarter Horse industry continue to resist the enforcement efforts, complaining that the sport has always conducted itself in a laissez-faire way, according to Ismael Trejo, the executive director of the New Mexico Racing Commission. “It’s really unfortunate, because if you do the right thing, you get a lot of pushback in this industry,” Trejo said. “It’s very unfair to racing, it’s unfair to our stewards, it’s unfair to [racing commissions] that people in the industry get in our way when we are doing the right thing.” Panel briefs regulators on prediction markets The ARCI recently formed an adjunct organization, the Sports Betting Regulators Association, so this year’s conference was organized around parallel slates of panels addressing issues germane to either racing commissions or gambling commissions. On Thursday morning, one of the panels was billed as a joint briefing, to discuss one of the most talked about issues in gambling, which is the recent explosive rise in prediction markets, typified by operators like Kalshi and Polymarket. :: DRF Kentucky Derby Package: Save on Past Performances, Clocker Reports, Betting Strategies, and more. A flurry of lawsuits have been filed by both the prediction-market operators and states where they operate, and there are currently a dozen bills in the federal legislature addressing the practice. Panelists on Thursday said they could not predict where any of the efforts would lead. Prediction-market operators began expanding their offerings only after the Trump administration went into office, seizing on the administration’s seeming hostility to any regulation of financial transactions, a mindset that led the administration to force a pullback of prediction-market regulatory efforts at the Commodities and Futures Trading Commission (CFTC). “It’s really important to remember how much has changed just because the administration has changed,” said Michelle Fischer, the moderator of the panel who is also the president of a simulcast-content company. “I don’t think we have seen anything like it before,” said Ian McGinley, the former director of enforcement at the CFTC, citing moves by the federal government to side with the prediction-market operators in lawsuits filed by states. Most top legal minds in racing believe the sport is protected from any cannibalization by the prediction market-operators by the Interstate Horseracing Act, the federal legislation that requires consent from multiple parties for any bet on a horse race offered across state lines. That is also the view of Churchill Downs Inc., whose chief executive officer, Bill Carstanjen, has said on multiple conference calls that any move by an operator to offer a contract on a race at a CDI track would be swiftly met with a stiff legal challenge. Still, it’s worth keeping prediction markets on the radar, because if any of the operators were to consider sticking a toe in racing in an environment where the executive branch of the federal government seems to be firmly on their side, it would be on a race that draws nationwide attention. That would be the May 2 Kentucky Derby. Pro sports bettors point out racing’s faults Two professional sports bettors took the stage during the lunch portion of Thursday’s program. While the bettors mostly spent their hour-long presentation outlining the strategies they use to make profits and offering recommendations for more player-friendly regulations, they spent the last several minutes explaining to the audience why they don’t bet on horse races. They did not have good things to say. Both were critical of the variable pricing exhibited in the pari-mutuel system, which would be expected for two people who make their living by monitoring early movements in the fixed-odds market and then taking advantage of discrepancies between fixed-odds prices on different platforms. :: Get DRF Kentucky Oaks & Derby Clocker Reports by Mike Welsch and the DRF Clocker Team But both were also critical of the dominance of computer-assisted wagering in pari-mutuel pools and what they called the “high rake” of the industry. All together, they said, those three features of horse-race betting would doom the sport in the long run. “It’s dying because the product doesn’t behave like a modern betting market,” said Adam Robinson, one of the presenters.  “You’ve got no price certainty, a high rake, and there are structural advantages to some of your players. The regular player has no chance. They get blown out at five times the rate as they do in other sports. They can’t survive your industry.” The other presenter, Gadoon “Spanky” Kyrollos, recommended that racing adopt fixed-odds betting, which is currently available in Colorado and New Jersey. Fixed-odds betting on horse races in both states has been well below the expectations and projections of its supporters. Kyrollos also said that the fixed-odds bets should pit one horse against another in a race instead of a price based entirely on the horse’s chances to win the race. More than a decade ago, Breeders’ Cup experimented with pari-mutuel head-to-head bets, but the bets were only offered for two years. “When you can water it down to just A vs. B, it becomes a lot more exciting,” Kyrollos said. :: Want to learn more about handicapping and wagering? Check out DRF's Handicapping 101 and Wagering 101 pages.