Authorities Try to Track Down Hit Men Who Target Racehorses : Crime: Greed and hard times spur increase in slayings for insurance money. The killers are sometimes brutal.

Powerful as they are, racehorses are fragile creatures. And so the death of a chestnut colt called McBlush might never have aroused suspicion--if his killer hadn’t offered to bring out the deadly hypodermic again.

This is a story about what killed McBlush, besides an overdose of insulin. Was it just greed for the $100,000 proceeds of an insurance fraud scheme? Or were tightened tax laws, inflated 1980s debt and plain old hard times in the silky realm of thoroughbred racing to blame as well?

It is also a story about other thoroughbreds that have died for their insurance value, sometimes crudely and cruelly at the hands of thugs wielding tire irons or electric shocks.

How many horses have been put down in this way? “Too damn many, and we’ve got to stop it,” said Bob Crawford, Florida’s agriculture commissioner. “These animals are so vulnerable, I’d compare it almost to hurting children.”

Several states where thoroughbreds are raised and run are the focus of investigations by his office and a federal grand jury in Chicago looking into a possible “nationwide ring” of horse killers, Crawford said. “I think in the near future there will be more charges,” he said.

The crimes--including the crowbar beating that sent a racehorse screaming through a Florida barn in February--may be brutal. But the blame apparently goes less to sadism than to bloodless economic factors.

Changes in tax laws in 1986 made horse ownership syndicates less profitable at a time when the industry already was slumping.

The average price paid at the prestigious Keeneland July Yearling Sales in Kentucky had tripled from about $200,000 in 1980 to a peak of $601,467 in 1984 but fell to $400,000 or less from 1986 to 1990.

“For Sale” signs now are common on horse farms in thoroughbred strongholds. Bankruptcy filings are frequent. Indeed, a 1991 University of Kentucky study warned that the industry in this pivotal state was “seriously at risk.”

“Over the past few years, the wrong kind of people have been getting into the horse industry,” U.S. District Judge Henry Wilhoit Jr. lectured one of the McBlush conspirators, Gerald Minsky, at his sentencing in July. “The people that are getting in are just simply not taking into account the risks.”

The judge spoke of 200 years of racehorse breeding in the Bluegrass, the lush land of steepled barns and white-fenced manors in central Kentucky that is the heart of the nation’s thoroughbred industry. A prosecutor spoke of “a reverence” for the sleek, swift animals here.

“A hundred-thousand dollars sounds like a lot of money to anybody, but when you compare that to destroying a beautiful creature,” the judge fumed, “it’s nothing at all. . . . He died an agonizing death.”

Minsky, a Connecticut businessman and civic leader, is appealing his conviction on conspiracy and fraud charges. He was sentenced to 18 months in prison, fined $100,000 and ordered to pay restitution.

Two men are completing six-month sentences for their part in the conspiracy to kill the horse. Dr. Joseph Brown, who admitted that he injected McBlush with a fatal overdose of insulin, and Robert T. West, a bloodstock agent who helped arrange the killing, pleaded guilty and were sentenced in May.

Their arrests in early 1990 resulted from an investigation by undercover agents of racing’s little-known security arm, the Thoroughbred Racing Protective Bureau, one of a number of agencies that have received tips about horse hit men.

“Information was picked up that there was a particular individual who was available to kill horses--who did kill horses,” said Paul Berube, president of the TRPB, based in Fair Hill, Md.

That individual turned out to be Brown, a Kentucky dentist and horse owner who was swamped by debt. Tipped by the TRPB, FBI agents arrested Brown at Florida’s Calder Race Course before any horse there was harmed.

“When a person shows up at a racetrack with hypodermics and drugs, there isn’t much wiggling room,” Berube said, and Brown quickly agreed to talk.

That is when authorities learned of McBlush.

The 3-year-old colt, a son of the leading sire Blushing Groom, was a promise unfulfilled. Insured in foal for $300,000, he lost value steadily after a paddock injury to his leg prevented him from racing. At the time of his death, amid speculation that his $100,000 insurance value would be further reduced, his owners were told that his only real value was as horse meat.

“Fifty cents a pound,” said Michael Baer, an assistant U.S. attorney in Lexington who prosecuted the case, quoting testimony.

Brown owed money to many people, and one of them was Minsky, by then principal owner of McBlush after other partners bailed out because of high upkeep costs. He testified that Minsky grew increasingly insistent about payment and finally began threatening him; Minsky denies Brown’s entire story, contending that Brown was so emotionally overwrought by his financial troubles that he became delusional.

“He told me that he would break my kneecaps. He told me he would break my hands. I wouldn’t practice dentistry,” Brown testified at Minsky’s trial last April.

Finally, Brown said, Minsky offered a way out of his debt. “He called and said that he had the horse McBlush . . . that he was broken down at the time, but that he was still insured. And that I was a doctor--could I put him to sleep without anybody finding out?”

Brown said he quickly agreed: “I saw it as the . . . only thing I could do to avoid total ruin.”

That call was in October, 1987, he said. McBlush, injected first with bacteria-laden water from a slop bucket and then with a heavy dose of insulin, died Nov. 4, 1987.

Brown did his dirty work well: An unsuspecting Lloyd’s of London sent McBlush’s owners checks totaling $100,000.

Only when Brown, still in debt, offered to kill again last year in Florida did the truth come out. Lloyd’s is seeking its money back.

Authorities may have been more alert around the time of Brown’s arrest because of ominous stirrings in the thoroughbred industry about horse killings for insurance fraud--a perennial but isolated problem, insiders say, that is increasing with the recession.

“Hard times, hard crimes, they say,” said Lt. John O’Brien of the Florida Agriculture Department’s law enforcement division.

Usually, O’Brien said, “it’s the type of crime that’s obscure. It’s difficult to prove.”

The killing of the 7-year-old gelding Streetwise last February near Gainesville, Fla., was different. Again, there had been a tip, and two suspects were placed under surveillance. But the fatal injury came with such brutal suddenness that it couldn’t be stopped by nearby agents.

“I could hear the horse’s leg break from where I was,” O’Brien said. Streetwise was clubbed with a crowbar and had to be destroyed. “The horse bellowed and screamed.”

Two Chicago-area horse handlers, Harlow Arlie and Tommy Burns, were charged with animal cruelty and insurance fraud. Arlie pleaded guilty and was sentenced to 18 months in prison. Burns is awaiting trial.

Both men, who reportedly were paid $5,000 to kill the horse, which was insured for $25,000, are cooperating with investigators in other suspicious thoroughbred deaths, authorities say.

The Chicago federal grand jury inquiry has been under way for about nine months, and the Florida Agriculture Department’s has been investigating for about a year, according to Crawford, the agriculture secretary.

Steve Miller, the federal prosecutor reportedly overseeing the Chicago investigation, would not even comment on whether it existed.

Some veterinarians and horse owners are said to be targets, though sources declined to be more specific about their names and home states or the number of horses allegedly killed.

“Lots,” said Robert Marcocchio, an Arlington Heights, Ill., equine insurance executive who said he knows horse industry people who may be targets. He described horse killing for insurance proceeds as a “nationwide problem, but it isn’t a nationwide ring”--the term used by others, including Crawford.

Marcocchio said he suspects that only a tiny fraction of claims to his office in the last decade--perhaps 2%--have been illegitimate.

“The major players are completely clean,” he said.

No one interviewed would describe the grapevine by which the hit men advertise their services or the way the system supposedly works, but an Arkansas case that ended in convictions in 1986 sheds some light on how a scheme could work.

Seven people were found guilty of operating a ring that collected $464,000 in falsified insurance claims on 19 registered quarter horses. The ringleader described “how easy it was to make money that way.”

A horse was bought at a low price, then “resold” among the conspirators at increasing cost and finally insured at the inflated value. Then the animal was killed--sometimes by electrocution, sometimes in a staged trailer accident, testimony showed.

The subject of horse killing was raised when Crawford met recently with an owners group in Ocala, Fla.

“To them, this is the worst, most despicable crime. All of the legitimate owners are outraged,” he said. “They just take it very personally. This is their greatest love in life, to see these horses run.”