Officials at Western Regional Off-Track Betting Corp. improperly helped themselves to tickets for sporting events and concerts, and CEO Henry Wojtaszek failed to account for personal use of his agency-assigned car, according to a pair of audits published Thursday by State Comptroller Thomas DiNapoli.
The audits, which confirm reporting by Investigative Post over the last three years, criticize officials at the state-created public authority for deficient oversight.
“The Western Regional Off-Track Betting Corporation needs to clean up its operations,” Comptroller Thomas DiNapoli said in a statement accompanying the release of the audits.
“Revenues from the OTB are supposed to go to participating municipalities, not to give board members and employees generous perks and other benefits.”
The audits do not address a controversial health, dental and vision insurance benefit package for OTB officers. However, in a letter obtained by Investigative Post, an attorney for the state Comptroller, Nelson Sheingold, said OTB has continued to provide the perk to its board members despite “clear admonitions from our office that this practice is impermissible.” Now, the matter has been referred to the New York State Attorney General’s Taxpayer Protection Bureau “for appropriate action,” the letter said.
“The board should immediately take appropriate action to cease this practice and recover any unlawful payments,” said Jennifer Freeman, a spokesperson for the comptroller.
OTB officials did not comment on the referral to the state AG’s office. Instead, a spokesman pointed to a decision to eliminate health insurance for all future board members during a closed-door meeting in July.
One the audits released today focused on a promotional sweepstakes that offered patrons a chance to win tickets to Buffalo Bills and Buffalo Sabres games, among other events. Between 2017 and 2019, auditors determined that at least 547 tickets were given to members of the Board of Directors, management, employees, OTB vendors and charities.
That’s 9 percent of all the tickets valued at $121,000, but that’s likely an underestimate, according to auditors.
“This amount is most likely greater due to the incomplete records described above and the likelihood other tickets were given to non-players,” it said.
Officials from OTB that attended events at Keybank Center and Highmark Stadium, among other venues, were allowed two tickets as a “host.” However, auditors found evidence that the limit was disregarded.
There were 18 tickets available for a November 2018 hockey game. None were given to OTB patrons. Auditors said Richard Bianchi, board chairman, received six tickets. Scott Kiedrowski, the vice president of operations, received nine. An OTB vendor received three tickets. The attendees spent $1,167 on concessions, including $177 on alcohol. However, OTB had no record of who actually attended the game.
For a December 2018 hockey game, 14 of the 18 tickets were given Bianchi is listed for four tickets. Another five tickets were earmarked for another board member. Five other tickets were listed for a “host.” The concession bill was $1,443, including $493 in alcohol. Again, there was no record of actual attendees.
For a March 2019 hockey game, a board member received 11 tickets. Another three were reserved for a “host” — meaning 14 of 18 tickets didn’t go to patrons. The concessions bill was $1,212, including $358 in alcohol. Once again, there is no record of actual game attendees.
Had the tickets to suites been used as intended — to entice more players to gamble at the OTB’s Batavia-based casino and racetrack — the audit said OTB could have “increased revenues” for the governments that own it.
“Without proper accounting for each ticket, officials have no assurance that all tickets are used for the intended purpose to reward players and tickets could be used by friends, relatives and other non-players,” the audit said.
OTB should solicit the advice of attorneys or the New York State Gaming Commission to determine if tickets were distributed to ineligible people and seek reimbursement, the audit said.
In a response included in the audit, Bianchi, OTB’s board chairman, said that will take up that recommendation. In addition, he said OTB has implemented a new procedure to track ticket distribution.
“Under the new procedure, Western is now able to better track those charitable tickets,” Bianchi said. “Western will continue to update its policy in respect to ticket distribution and submit it to the board for adoption.”
The other audit found fault with the board’s oversight of Wojtaszek’s vehicle usage. For three years, between 2016 and 2019, Wojtaszek was the only OTB employee who didn’t pay back the organization for his personal use of a take-home vehicle.
Wojtaszek owed $3,484 for the personal miles he racked up on that car, which was ultimately paid in April 2019.
“The CEO failed to comply with the board’s take-home vehicle policy, therefore he did not demonstrate appropriate ‘tone at the top,’ which is essential to establish strong internal controls,” the audit said.
Auditors determined that Wojtaszek’s mileage logs “were not complete or accurate.” For example, there were no logs for 13 months.
The audit said: “We noted a number of instances in which recorded mileage for the day averaged 50 miles. For example, on November 25, 26 and 27, 2016, total daily miles recorded was 40, 60 and 50, respectively. These daily mileage amounts are less than the CEO’s round-trip commute from his residence to the corporation’s main office, and his time records indicated these days as worked. Therefore, the CEO’s mileage logs could not be relied on to assess whether there was an accurate accounting of his business and personal miles.”
Officials at OTB told auditors the inaccuracies occurred because Wojtaszek “did not always properly maintain mileage logs and that he sometimes used his personal vehicle for work-related travel and to commute.” In some cases where logs were not on file, they were completed at a later date using estimates.
Though the Comptroller recommended minimizing the use of take-home vehicles, OTB said in its response to the audit that it would consider eliminating them entirely. For his part, Wojtaszek turned in his vehicle in 2019 when Investigative Post questioned its use.
“The board said they are acting on our recommendations and I urge them to continue to tighten oversight and eliminate questionable spending,” DiNapoli said in his statement.
In addition to the comptroller’s review, OTB operations remain the subject of an ongoing federal investigation by the FBI and U.S. Attorney’s Office.
OTB is also contending with a whistleblower lawsuit filed by a former employee who cooperated with investigators.
“We invited the comptroller in to do an audit, cooperated fully and welcome their suggestions,” Wojtaszek, OTB’s CEO, said in an email responding to a request for comment. “Many we had already implemented before their review. The fact is any organization can always improve the way they operate.”