Peer-to-peer betting exchange Betfair has cancelled all bets taken on the tennis match between Nikolay Davydenko and Martin Vassallo Arguello yesterday. A statement put on the site today reads: "Following consultation with the men’s professional tennis tour, the ATP, Betfair has decided to void all bets placed on Thursday’s 2nd …
This irregular pattern wouldn't happen to be one that would have resulted in betfair losing a large amount of money would it?
If so they need to give a much better reason than irregular betting patterns.
They do say they...
...consulted with the ATP, so I'd be surprised if they didn't have a legit reason for taking this action. It's unlikely that Betfair stood to lose much, given they're not, as I understand it, a bookkeeper, but instead facilitate bets between punters.
Andy S: Silly, Betfair don't lose money like this
They aren't a bookmaker, they make commission on bets, hence they don't really care who wins or loses, they take a small % of the trade.
But, it all has to appear to be not-fixed to safeguard their reputation.
Betfair would make money on the bets either way - the betting system pits users against one another, and Betfair takes a percentage.
Not really if you understand their business model. Betfair are P2P (did you miss that bit in the article?) -- so you're betting against other punters (should they choose to take your bet). Betfair are essentially brokering the bet between two unconnected parties; they just cream a percentage of each transaction off the top.
No it wouldn't. Betfair is setup to make money from every transaction, regardless of which way the punter bets. By voiding bets they stand to lose money, no matter what the bets were.
Betfair collects transaction fees from punters betting against each other, a normal bookie collects (or loses) money wagered on losing (or winning) bets bet against that bookie (and could make or lose money by voiding bets, depending on the situation)
wide of the mark
Betfair aren't a conventional bookie whose position is the opposite of their customers. Betfair match bets between customers and take a commission (a percentage of what people win). If they void a market it costs them money.
The reason they can't say more than "irregular betting patterns" is pretty obvious: it would be hard to say anything more that wasn't defamatory.
No they wouldn't
Betfair doesn't lose money based on the outcome of bets - it's a betting exchange not a bookies. In fact they will lose money by voiding the bets (their commission)
Betfair LOSE money from this
Its a P2P betting exchange, not a bookmaker. Betfair make their money on comission from settled bets so they just threw out loads of cash.
Irregular betting patterns = far too obvious scam
It's pretty tough for betfair to LOSE money. As mentioned in the article, they are a peer-to-peer bookmaker. They match you up with someone willing to take the opposite bet, and you either win or lose against them, not betfair. Betfair are essentially an agent, who take a slice of the winnings, for matching you up with someone willing to gamble with you. The other side of this is that by arranging these bets, betfair are the people holding on the money before giving it to the winner. Although they won't take the slice they would have if they just paid out, I'm sure £3m in their accounts will accrue a little bit of interest before this is settled. They certainly haven't thrown out any cash whatsoever.
The irregular betting was that after Davydenko won his first set, a lot of money was placed on the other guy (Arguello), which is not what you'd expect. Davydenko's odds actually lengthened after winning his first set, because around £3m was staked on Arguello, both just before the match, and during the first set. This is around 10 times more than you would expect to see staked on a match like this. If it was Nadal v Federer, at a major tournament, then maybe, but not this. After all the money piled on, the apparent favourite to win (although still 2nd favourite with betfair) got an injury and retired.
The real implication from this is not that someone has tried to defraud a bookie, this happens all the time, with little sympathy. The real story is that for this to have happened, Davydenko must be in on it. How else would you know he'd definitely pull out, especially after winning the first set? The ATP will pursue this a lot heavier than betfair will.