The Business of Horses: How the Wealthy Invest in Racing, Dressage and Beyond

Litigation attorney Kayla Pragid, who leads the firm's Equine Industry Team, was quoted in a Citywealth article about the evolution of equine investment. Ms. Pragid commented on persistent fraud risks as high-net-worth investors take interest in the space and look to capitalize on high-value horse transactions. For example, she explained, agents, trainers and brokers can mask true sale prices, inflate or split commissions and reroute payments through third parties, making audit trails difficult and disputes costly. To help mitigate these risks, she recommended direct buyer-to-seller funds transfers, detailed written sale contracts that identify all agents and their compensation, independent valuations or vetting at key price points, and routine reconciliation of invoices and bank records to curb abuse, protect investors and improve recoverability if fraud is discovered.

"Fraud has largely gone unchallenged and uncorrected in the equine industry despite its rampant existence for many years," she said. "Those who are defrauded are typically high-net-worth individuals who do not catch the fraud immediately because there are layers of intermediaries between them and the fraudulent activity."

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