Racing NSW is investigating allegations of "non-compliance" with formal tendering and procurement standards by the Tamworth Jockey Club.
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The Leader revealed on Monday the state racing regulator had accepted an offer by the club's entire board to stand aside in light of the inquiry.
In a statement issued to media on Tuesday, Racing NSW gave more detail about the allegations at the centre of the crisis at the club.
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"Racing NSW's minimum standards and conditions of registration for NSW thoroughbred race clubs include stringent requirements in respect of tendering and procurement process for any significant expenditure by race clubs and that is the current focus of Racing NSW's inquiry," the statement said.
"As Racing NSW's inquiry is ongoing, it is not appropriate to make any further comment at this stage."
The statement also confirmed the state regulator "will appoint an administrator to Tamworth Jockey Club".
The administrator will serve "while that inquiry is completed".
It's unclear how long the investigation will take to reach a finding.
Racing NSW is working with Tamworth Jockey Club on the performance of its track and the effect on the racing program, according to the statement.
Racing Minister and Tamworth MP Kevin Anderson told the Leader on Monday he had spoken with jockeys before Christmas concerned about the state of the track, and relayed those concerns to the club's general manager.
The club's two most recent meets were relocated over concerns about the quality of the track, after recent heavy rain.
Club general manager Wayne Wood confirmed to the Leader on Monday that the board had offered to step aside on Friday, which was accepted by Racing NSW on Monday.
The next meet is scheduled for January 21.