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It's all gone Pete Tong at Betfair!

The Christmas Hurdle from Leopardstown, a good Grade 2 race during the holiday period. But now it will go into history as the race which brought Betfair down.



Over £21m at odds of 29 available on Voler La Vedette in-running - that's a potential liability of over £500m.

You might think that's a bit suspicious, something's fishy, especially with the horse starting at a Betfair SP of 2.96. Well, this wasn't a horse being stopped by a jockey either - the bloody horse won!



Look at what was matched at 29. Split that in half and multiply by 28 for the actual liability for the layer(s). (Matched amounts always shown as double the backers' stake, never counts the layers' risk).

There's no way a Betfair client would have £600m+ in their account. Maybe £20 or even £50m from the massive syndicates who regard(ed) Betfair as safer than any bank, but not £600m. So the error has to be something technical. However, rumour has it, a helpdesk reply (not gospel, naturally) has implied it wasn't a Betfair issue.

I would be extremely surprised if this race was paid out in full - if it is a massive customer Betfair have offered credit to (has been offered in very selective cases), then the customer is quite likely to argue technical error that Betfair should have blocked and refuse to pay up. As mentioned above, I severely doubt it's a customer/syndicate with that much in cash reserves, and the other point to remember is that Betfair TSE Ltd are now under the regulatory control of Gibraltar authorities, who don't have a history of putting the punter first. Betfair aren't the kind of company who will take the whack on the chin if it was an internal balls-up, and £23m will make a serious dent into their all-important share price.

Almost 40 mins later, and the race hasn't been settled. I doubt it will for a while yet either.

Hmmmm.....

Comments

  1. well they'd have to have over 600 million in the account to be able to lay that type of bet. Also, there was over 1.6 million matched which would equate to a payout of around 50 million pounds. Doubt they'd settle the bets as it's probably a technical error especially considering that Mourad was matched at 1.04

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  2. Amazing! Was looking at it as it was happening. Has anything similar (even if on a smaller scale) ever happened on betfair/betdaq before? How was it settled back then?

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  3. George - there have been cases of bots going wrong before, to the tune of a few 100k, and the client had to pay up. But nothing like this, it defies all numbers, there can't possibly be a client acct with that much liquidity in it.

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  4. Betfair is an exchange, can't see why they'd be liable themselves, and it's unlikely that amount of money was matched at that price surely?

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  5. Matt - has to be a technical problem somewhere. Second image shows how much was matched - about £23m loss by the layer when you split the liability in two (amount matched shown equals double the backers' stakes).

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  6. Oh I see, so someone might have missed typed a lay bet you think?? Owch!

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  7. no because, you'd need £600m in your acct to cover the liability - highly unlikely that is an option for even the biggest client with a huge credit limit.

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  8. OK, I've re-read your post slowly this time, I finally understand what you're getting at. Apologies.

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  9. Anonymous or the Chaos Computer Club?
    For me, i empty my Betfair-Account now.

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  10. Voler La Vedette betfair SP was 2.96 while the in-play bid was 29 ... I think the error has to do with a fat finger moving the decimal one spot to the right from 2.9 pre-event.

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  11. Betfair has posted an official statement:

    Customers betting in-play on this race will have seen that Voler La Vedette was available to back at 29 when the in-running market was suspended, and that a considerable sum was matched on the clear winner at that price.

    An investigation has revealed that this was due to an obvious technical fault which allowed a customer to exceed their exposure limit.

    In accordance with our terms and conditions, all in running bets on this race, both win and place, will be made void.

    We fully appreciate the dissatisfaction this will cause many customers, and apologise for a very poor customer and betting experience.

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  12. I agree George, it does look as if the lay was meant to be at 2.9 instead of 29. That alone does not account for such a liability on one account.
    Somebody would have had to inputted the 21 or so million in the stake as well.
    After doing both of these things if the money was not in the funds the bet should have been rejected, which begs the question why it was not.
    I almost positive that if you tried it all day long everyday for a year you wouldn't be able to do it yourself.
    Betfair have messed up and have put forward a poor excuse and should be made to produce evidence of the account in question to validate their theory.

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  13. George - maybe, but that's only part of the error. Even if it was 2.9, the liability would still have been over £50m.

    Whitey - that's an issue for the courts/regulators to decide. If it was your acct which fell victim to the tech bug, would you want it shown in public?

    The liability cap on a particular acct has failed, and it appears the bot working that account runs an algorithm which links activity to available funds. How it has happened is the concern.... more on that in next post.

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  14. Seems that Betfair's T and C's have been ignored on this occasion:
    "Your betting limit is represented by the lesser of: (i) your 'Available to Bet' balance shown in your account and (ii) your ‘Exposure Limit’ (which is available in the “Account Summary” tab in “My Account”). However in the event that we process an offer for a bet or the acceptance of a bet in an amount outside the applicable thresholds, such bet will nevertheless stand."
    You cannot trust Betfair.

    ReplyDelete

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