N.Y. Comp. Codes R. & Regs. tit. 9 § 5604.5
Any prize won by a prohibited person, other than prizes that may be used as offsets pursuant to Racing, Pari-Mutuel Wagering and Breeding Law section 1404(b)(i), shall be null and void and a registrant may pursue recovery of any such prize from the prohibited person who won such prize. Upon discovery within one year of the conclusion of a contest that a prohibited person has won or may be entitled to win a contest prize, a registrant shall recalculate all prize winnings for such contest as if such prohibited person had not entered such contest and shall for each contestant award and credit to each contestant the difference between the recalculated prize award and the prize already awarded, if any. A registrant may submit to the commission, for review and approval, a plan that establishes alternative benefits to contestants in lieu of recalculated prize awards.
N.Y. Comp. Codes R. & Regs. Tit. 9 § 5604.5