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Betfairs Liability in relation to its software failing
As somebody who likes to “-back and lay”- on UK horse racing, I was more than annoyed, when having placed a bet on a UK horse race, Betfair’-s software malfunctioned, meaning that I was unable to lay off my bet as was my intention.
To those of us that engage in backing and laying, the result of the race is irrelevant- we are trading on price movements and price movements alone. It was my belief (mistaken) that the contract that I had entered into with Betfair, would ensure that at all times Betfair would provide me with the means to back and lay, and that where it was unable to do so, the company would rule that as a proper market had not been formed on the race, my bet would be declared void, and my stake monies would be returned.
Alas, this was not so, as the following reply from Betfair makes clear-
“-As the site was not available to any customers between 2 –- 4pm, no bets were placed during this time and as this was due to matters beyond our control, our terms and conditions (11.3) state that:
We are not liable for the failure of any equipment or software howsoever caused, wherever located or administered, or whether under our direct control or not, that may prevent the operation of our betting services, impede the placing of orders for bets or the matching of bets, or prevent you from being able to contact us. In particular you should be aware that if you place a bet with the intention of subsequently placing a separate bet to reduce the liability incurred by the initial bet, there can never be a guarantee that the Exchange will be available at the point you wish to place the subsequent bet.”-
As it happens, the race concerned was the 2.45 at Fontwell, which somewhat contradicts Betfair’-s statement that- “-As the site was not available to any customers between 2 –- 4pm, no bets were placed during this time.”-
That aside it would seem that I have been snared by Betfair’-s all encompassing exclusion clause, to the effect that-
“-In particular you should be aware that if you place a bet with the intention of subsequently placing a separate bet to reduce the liability incurred by the initial bet, there can never be a guarantee that the Exchange will be available at the point you wish to place the subsequent bet.”-
I do not accept that this exclusion clause is fair or equitable, and accordingly I shall seek legal advice as to its efficacy. In the meantime, I will no longer use my Betfair account.
Betfair are rumoured to be lining up for a 1.5bn flotation- it is a disgrace that they do not have back up servers to prevent their site from crashing. When such an occurrence does take place, it is in Betfair’-s interest to return all bets. Betfair, the revolutionary betting company, have much to learn about the concept of goodwill.
Vernon Smith is bullish on event derivative markets (a.k.a. prediction markets).
Vernon Smith (via):
So far as new applications of derivatives markets I think one possibility is we may see more people making, creating derivatives markets, betting markets on policy, public policy outcomes. We’-ve already seen that with regard to the Federal Reserve. There is a market now in which people are able to make, take positions on the likelihood of a change in the Federal Reserve Bank policy at their next meeting of the Federal Open Market Committee, so and these markets are concerned with the question of what the Federal Reserve Bank rate will be set at. So I think we may very well see more of these kinds of markets and this could very well provide some indication of how the participants in these markets evaluate some of the policy proposals that governments are making.
Watch the video (download this post if your feed reader does not show it to you):
You cant have accumulator bets on the weather of neighboring regions…
Why an analyst should assess each newly created prediction market
The Chicago candidacy, which was favored by the prediction markets (and gullible bettors like Ben Shannon), is the one that fared the worst.
As we have blogged here many times, not every prediction market is created equal. Some are bound to aggregate bits of known information. Some others (e.g., the Olympic city prediction markets) are not able to do that, because no good information is leaking out. The IOC is a close aristocratic group that does not leak out good information. Those who forgot that and bet the farm on Chicago are now licking their wounds. You need an information analyst to assess whether a particular prediction market is pertinent.
– BetFair’-s event derivative prices:
– InTrade’-s event derivative prices:
– HubDub’-s event derivative prices:
Professor Thomas Rietz (Iowa Electronic Markets) was so wrong on the usefulness of prediction markets about the 2016 Summer Olympics in Chicago.
Chicago Olympic Market Might Have Value, Says Reitz (Chicago Tribune, April 17)
A credible source of information about Chicago’-s chances of hosting the 2016 Olympics would have value, says columnist Bill Barnhart. Local real estate developers, hotel operators, employment agencies, vendors of products and services to major events and others have a direct stake in whether or not an Olympics is staged here. Politicians and civic leaders presumably would want to know whether the city’-s bid has a chance, so that they wouldn’-t throw good money after bad. An auction market centered on whether Chicago will win could provide that information, even if there were no huge payoff for hedgers or speculators, said finance professor THOMAS RIETZ at the University of Iowa, a board member of the popular Iowa Electronic Markets. The Iowa market limits wagers to $500 but has an enviable track record in picking the winners of national elections. “-Our goal is to aggregate information, which is a different goal than being able to hedge the economic risk associated with something like this,”- Rietz said. “-I don’-t think it’-s an outlandish idea.”-
http://www.chicagotribune.com/business/yourmoney/chi-0704160447apr17,0,2547860.column?coll=chi-business-hed
Prediction markets on which country will host the Olympics have never worked.
– BetFair’-s event derivative prices (on the far right of the chart, you can see that the price went down to zero):
– InTrade’-s event derivative prices (on the far right of the chart, you can see that the price went down to zero):
– HubDub’-s event derivative prices:
Chicago wont have the Olympics in 2016.
The Chicago candidacy, which was favored by the prediction markets (and bettors like Ben Shannon), is the one that fared the worst.
– “-Will Chicago get the Olympics? Dona€™t bet on it. Too risky.“-
– The prediction markets are not able to forecast which country will get the Olympics. The IOC is a close aristocratic group that does not leak information. Hence, it is not possible to aggregate information.
– Once again, Ben Shannon made a very bad bet. He should read Midas Oracle more often —-if he wants to avoid personal bankruptcy.
– Once again, we see that the P.R. agents of InTrade and BetFair (who both bragged about being able to predict Chicago) were overselling.
– BetFair’-s event derivative prices (on the far right of the chart, you can see that the price went down to zero):
– InTrade’-s event derivative prices (on the far right of the chart, you can see that the price went down to zero):
– HubDub’-s event derivative prices:
June 28s BetFair millionaire story (about Elliott Short) in the News Of The World was total bullshit.
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Recent ‘-News of the World’- Article
Betfair Customer Services 29 Jun 13:13
We have been contacted by several customers in relation to an article in Sunday’s News of the World. We would like to make it clear that Betfair was not asked to comment on, or validate any aspect of, the article ahead of publication.
Although we cannot comment on the activities of any specific customer, some facts which may be relevant to some of the claims made in the article include:
The biggest winner in the relevant Britain’s Got Talent market (Susan Boyle winner –- Yes/No) won less than ?3,000.
No Betfair customer won ?1.5 million or anything even vaguely approaching that amount betting on the Champion Hurdle.
No Betfair customer won ?500,000 or anything even vaguely approaching that amount laying Monsieur Chevalier at Royal Ascot.
The figures shown in the account statement screenshot in the News Of the World do not reconcile to any Betfair account.
The monies present in a Betfair account are obviously no indicator of the sums won or lost on the account.
We would encourage customers to be wary of the claims of anyone purporting to have a profitable system or strategy.
We would encourage customers to retain a healthy degree of scepticism toward any claims made in the press which are not validated by Betfair.