The second link is to the sales offering now.
@LaurieB, Does Keeneland own the horses now or are the breeders still the owners?
The same in Ireland, France and the UK. Tattersalls in England have paid the breeders their money for the 17 horses and then contacted people who had purchased from the Book One sale to ask if they were interested, “owing to sums unpaid”, in buying them privately. Salah Al Homaizi, the joint owner of Authorized who won the Derby in 2007, was identified as the client in the Press. The poor Bloodstock Agent must be in despair after a major spending spree has gone so wrong but he hasn’t confirmed any names.
Am I understanding correctly that the same guy that didn’t pay for horses he “bought” at Keeneland didn’t pay for horses he “bought” at Tattersalls as well?
Yup. Tattersalls, Goffs and Arqana too. I think the Auctioneers generally keep quiet about non-payments, and they trusted the known Agent and subsequently the Buyer, with his previous form, but the sums involved are very large as these are all top class young stock. Highest price at Goffs Orby Sale, for example.
I wonder what the problem was. Not enough money, someone else controls the finances and said no, is he under some sort of economic sanctions over association with sanctioned Russians?
This is the 2nd sale Keeneland has held to resell horses “purchased” by the same buyer. The previous sale took place last fall. Those horses were a year older than this group (2 at the time) and also at a training center. Some brought very high prices, others sold very inexpensively.
@skydy, at one time Keeneland guaranteed that sellers would be paid if their horses sold at their sale, but that’s no longer true. So I don’t know who are the current owners of these horses.
I wonder what made Keeneland give him a second chance? I’d be rather unhappy with them if they didn’t disclose that fact and it was one of my horses that he didn’t pay for this time around.
Does the sale know who an agent is repping?
Yes, because the actual buyer needs to have an account with verified credit. Also, the agent needs to named as qualified to spend that money (which obviously isn’t theirs). Which is not to say that things don’t get a little loosey-goosey at times–but that’s usually with habitual big spenders, frequent buyers, and people who are well known to Keeneland.
Nothing new…I recall a big spender in the Arabian world around 1980ish. Same thing, built an empire on leveraged assets and things he just never paid for. Nobody who bred to his studs could get the paperwork (well before AI), some who bought young stock from him could not get the papers, he never owned them or their parents, auction consigners never got paid etc. think he was based in Micanopy.
Message to Keenland, Tattersalls the Ocala spring sale et al. A promise and a handshake went out with the last century. Demand proof in writing and ore approve bidders like a bank selling a mortgage.
I’m sure the buyer looked good on paper. Uber rich people like this always do. The only way to know for sure would be to make buyers put money in an account up front, which would kill a lot of agents who buy horses first and scramble around for interested parties with money later.
Probably–letters of credit or “balances” can probably be had by request.
It’s one thing if it is the first time it happened with that buyer. Fool me once, shame on you, fool me twice, shame on me.
For a buyer with a track record like that, he shouldn’t be allowed to bid at all.
If there is some reason they think they just have to have him, make him put his entire purchase budget in cash in escrow for the auction to use to settle up at the end. They track what each buyer is spending during the auction. Easy enough to cut him off if he uses it all before the end of the auction.
I don’t know why they would let the guy in (or the agent would even work with him) except that maybe he’s pretty good for bidding a horse up that might not otherwise be getting much activity. I won’t say shill bidding if he would genuinely buy if bidding stopped on his last bid. But the next thing to it. Auctioneers appreciate a buyer who is in there bidding on multiple items.
A bill for £20 million is a bit rich to swallow if the Auction House is engaged in fraudulent activity. The UK horses were all Book One top notch individuals. Tattersalls guarantee the money the breeders get, all part of the competitive business of getting sufficient good horses to sell. Keeneland doesn’t: less competition.
I’m not sure, if I was a regular consigner, I would ever consign to Keeneland again after this.
Keenelend is clearly at fault in this situation more so since this particular “buyer” has a known, and very recent, track record of doing the same thing elsewhere. He should’ve been denied to bid without question.
How he was allowed to bid, under an agent, is a complete lapse in judgement and protocol on Keenelands’ part.
While I do have some pity on the agent; if you are bidding with a bankroll of that level; why didn’t the agent do his due diligence to protect himself here? It’s not like this buyer pulled the same stunt 20 years ago, it was last year.
It seems that there is a difference in the Keeneland Default procedures, however the legalese it bit much for me to be sure. See the difference in procedure if the buyer has established credit with Keeneland Sales? My bolding (mostly.)
From the website;
DEFAULTERS: In the event any Purchaser who does not have prior approval of his credit fails to pay the purchase price within sixty (60) minutes from the fall of the hammer or fails to sign the Acknowledgment of Purchase and Security Agreement, then the Purchaser shall be deemed a defaulter (“Defaulter”) and Keeneland shall notify the Consignor of the default upon discovery of the Defaulter. The Consignor of the horse for which the purchase price is not paid has the option of (1) extending credit to the Purchaser and accepting all risk therefor; OR (2) voiding the sale, and requesting the horse be re-offered; OR (3) retaining ownership of the horse. Consignor must decide which of the three foregoing options it elects within thirty (30) minutes of notice to the Consignor by Keeneland of non-payment. If the Consignor fails to make its election within said thirty (30) minutes, the horse, in Keeneland’s sole discretion, may re-enter the auction ring during the same sales session, and then be sold with the prior attempted sale to the Defaulter being voidable by Keeneland, which shall be binding on all parties. In the event Keeneland, in its sole discretion, determines it is not practicable or advisable to resell the horse during the same sales session, then the horse may be resold by Keeneland at public or private sale, including on any subsequent day or sales session of the sale in question, without prior notice, for the Defaulter’s account, costs of such sale and attorneys’ fees to be borne by the Defaulter. Any deficiency owed by Defaulter resulting from resale on account of any default which is not collected from the Defaulter shall be borne by the Consignor, and Keeneland shall have no responsibility therefore. Purchasers who have purchased on credit, and who fail in any respect whatsoever to pay for horses within fifteen (15) days after the sale, shall likewise be in default and Keeneland shall have the right to bring suit against the Defaulter and/or to repossess the horse and its registration papers and in connection therewith, Keeneland shall be entitled to the recovery of its costs, including without limitation all reasonable attorneys’ fees, from the Defaulter. Any horse purchased by a Defaulter may be resold by Keeneland at public or private sale, without prior notice, for the Defaulter’s account, costs of such sale to be borne by the Defaulter. FURTHER, THE DEFAULTER SHALL BE LIABLE FOR A DELINQUENCY OR LATE CHARGE AT THE RATE OF ONE AND ONE-HALF PERCENT (1-1/2%) PER MONTH ON THE UNPAID PURCHASE FROM THE DATE OF SALE UNTIL PAID, COMPOUNDED MONTHLY. Should such resale fail to satisfy the Defaulter’s account in full, Defaulter shall be responsible for any such deficiency balance and shall pay Keeneland the amount owing . Purchasers who have purchased on credit, and who fail in any respect whatsoever to pay for horses within fifteen (15) days after the sale, shall likewise be in default and Keeneland shall have the right to bring suit against the Defaulter and/or to repossess the horse and its registration papers and in connection therewith, Keeneland shall be entitled to the recovery of its costs, including without limitation all reasonable attorneys’ fees, from the Defaulter. Any horse purchased by a Defaulter may be resold by Keeneland at public or private sale, without prior notice, for the Defaulter’s account, costs of such sale to be borne by the Defaulter. FURTHER, THE DEFAULTER SHALL BE LIABLE FOR A DELINQUENCY OR LATE CHARGE AT THE RATE OF ONE AND ONE-HALF PERCENT (1-1/2%) PER MONTH ON THE UNPAID PURCHASE FROM THE DATE OF SALE UNTIL PAID, COMPOUNDED MONTHLY. Should* such resale fail to satisfy the Defaulter’s account in full, Defaulter shall be responsible for any such deficiency balance and shall pay Keeneland the amount owing, including late charges, all reasonable attorneys’ fees, costs of such litigation and any other damages available to Keeneland by law, including reimbursement for all expenses in caring for and insuring said horse****.**
And we see how (not) successful they are at squeezing blood from a turnip by the need to put the horses back through the auction sale, so they can collect something.
I wouldn’t be surprised if the affected breeders are delivering some very harsh comments to Keeneland.
The language regarding horses sold by Keeneland on credit made me think that perhaps Keeneland was stuck with those horses. Why else would they have the reimbursement for caring for and insuring those horses in the language?
I’m not sure why you think the breeders would be upset. These are expensive horses. They will be purchased by people who will be aiming to get them to the races (what Breeders mainly care about). The Owners at the time they were sold have been paid. Keeneland, or any TB auction company for that matter, grants the credit. This is a problem for the sale company only.