NYRA Reminds Employees to Report Ethics Violations

New York Racing Association officials said March 7 they have stepped up efforts in the aftermath of the Christopher Kay controversy to alert employees of their obligation to report possible ethics violations they witness.

Joseph Lambert, the NYRA general counsel, told a New York State panel called the Franchise Oversight Board that officials at the racing corporation are "laser-focused" in an effort to inform employees about their obligation to report "things that are obviously not correct."

NYRA officials told the state panel that two executives—not named during Thursday's meeting—were reprimanded or sanctioned in some manner after the Kay matter surfaced. Kay was let go as NYRA president and CEO in January after officials learned he had used NYRA staffers to help provide some level of services at a home he owns in Saratoga Springs, N.Y.

Lambert said NYRA has had "a culture perhaps" where people are "reluctant to report bad things." Employees are being told they not only have an obligation to report ethical violations but also that whistleblowers will not face any job retaliation for coming forward.

"It's our No. 1 priority. I can assure you of that," Lambert told the franchise oversight board, which was created in 2008 to monitor NYRA finances and other matters.

Robert Williams, chairman of the state oversight panel, re-configured the board's agenda Thursday to discuss the Kay aftermath as the first item of business.

"We understand it's a little difficult to talk about something like this," Williams said, adding that NYRA did handle the Kay matter with "mercurial speed."

Still, Williams said, the Kay controversy "took a lot of people by surprise that something like this could occur and did occur.

"We just want to make sure NYRA is placing enough interest and concern relative to ethics and (that) ethical guidelines of behavior is something everyone understands is part of the culture of NYRA," added Williams, who is also executive director of the New York State Gaming Commission, which regulates horse racing and the gambling industry in the state.

"Everywhere I go, people ask me what went on at NYRA and what are they doing" to address the situation, Williams added.

David O'Rourke, the interim CEO of NYRA who replaced Kay, did not attend the meeting. 

NYRA officials said ethics training is conducted for new employees; that will increase, they said, to at least once a year for all existing employees so there is a full understanding of the corporation's code of ethics.

Asked if allegations against Kay should have been reported earlier by NYRA employees, Lambert said: "It should have been, yes." And additional ethics training might help convince employees who believe there is wrongdoing at NYRA to come forward? "We believe so," Lambert responded.

NYRA officials confirmed to the oversight board that the Kay matter was reported to NYRA via an anonymous tip. One franchise member likened the incident to a "drive-by shooting" that has hurt NYRA's reputation.

"This is a blow," Lambert said.