I'll take a shot at this. Someone decided they didn't want the key switch so they removed it and connected the red/black wire to ground.(proper) Then some moron decided he wanted a key switch, so he put one back on and connected into the black/white and black wires(the kill switch circuit). Possibly even into the TORS connector.
In order for the bike to run, the red/black wire must be grounded and the black/white wire not grounded.
So, the key switch is closed in the run position and the kill switch is open in the run position.
So, in your case, turning the key to on, closes the contacts, connects black/white wire to ground and kills the motor.