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Old 05-25-2008, 05:48 PM   #1
mack

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Default Web Site Puts Focus on the Fix in Sports Bets (Betfair)

Hey jonny, have you been fixing sporting events again??? ...

Web Site Puts Focus on the Fix in Sports Bets

LONDON — With Internet gambling predicted to surpass $20 billion in 2008, and with illegal wagering accounting for $150 billion in the United States, by some estimates, the temptation for those seeking to influence the outcome of games has never been greater. Now, a raft of gambling scandals in sports, from cricket to soccer and most recently tennis, has raised an uncomfortable question: Are the games we watch fixed?

Last Monday, a report commissioned by the major tennis governing bodies recommended that 45 matches played in the last five years be investigated because betting patterns gave a “strong indication” that gamblers were profiting from inside information. And those matches, the report said, may be only the tip of the iceberg.

The match fixing might never have been discovered had it not been detected by Betfair, which has revolutionized online wagering since its Web site started in June 2000. At any moment, Betfair’s customers have $360 million on account and are at their keyboards, matching odds with fellow bettors in 80 countries. It is eBay for gamblers, with wagers being made in real time, usually after the matches have begun.

Betfair has become a focal point for the growing list of match-fixing scandals. Over the past seven years, it has alerted dozens of sports about suspicious betting activity, leading to investigations in horse racing, soccer and now tennis.

“You’re at risk of being victimized by inside information if you’re playing these markets,” said David Forrest, an economics professor at the University of Salford in England. “While Internet gambling has offered transparency, it has offered temptation as well. There’s greater liquidity for the cheats, and new forms of wagering and more money than ever. There are more incentives for athletes or officials to manipulate or fix a game.”

The most prominent scandal has involved the tennis player Nikolay Davydenko, ranked fourth in the world and seeded fourth in the French Open, which begins Sunday. At a tournament in Sopot, Poland, in August, Mr. Davydenko went from being a heavy favorite against 87th-ranked Martin Vassallo Arguello of Argentina to being a significant underdog during the match.

Mr. Davydenko’s odds got longer, and more money came in for Mr. Vassallo Arguello, even after Mr. Davydenko won the first set. Mr. Davydenko retired because of an injury with Mr. Vassallo Arguello ahead, 2-6, 6-3, 2-1. During the match, Betfair notified the ATP, the men’s professional tennis association, that its security team had recognized irregular betting patterns. After the match, Betfair voided $7 million in bets, the first time in its history that it had taken such a measure. It turned over all of its data to the ATP.

Mr. Davydenko has denied wrongdoing. He has refused a request from ATP investigators for the cellphone records of his wife and his brother.

The incident, along with the fact that at least a dozen ranked players told members of the news media that they had been asked to throw matches or had heard of similar approaches made to other players, prompted the 66-page report, “Environmental Review of Integrity in Professional Tennis.”

Now many in professional tennis are calling for a global anticorruption body for sport, to run along the lines of the World Anti-Doping Agency. The idea has been embraced by most major sports in Europe.

“Insider trading is a bigger deal in sports than in the financial markets,” said Justin Wolfers, a professor of business and public policy at the Wharton School at the University of Pennsylvania, who studies gambling. “We have the Securities and Exchange Commission here. Why not the same for what is a multibillion-dollar sports gambling market?”

From its office above the Thames, Betfair has been the de facto watchdog for sports. Computers glow 24 hours a day, and televisions beam in snooker, basketball, soccer and horse racing, among the sports on which Betfair offers 4,000 kinds of bets a week.

Betfair’s founders, Andrew Black and Edward Wray, whose backgrounds are in the stock market and investment banking, say they have built a better mousetrap. More than a million customers of the Web site, Betfair.com, wager against each other, setting their own odds and paying a fraction of what traditional bookmakers charge.

As Internet gambling has boomed from a $6 billion industry in 2003 to the more than $20 billion expected this year, according to the Maine-based research firm Christiansen Capital Advisors, Betfair’s revenue has grown to $372 million, from $64 million in 2003. Last year, by taking 2 percent to 5 percent commissions on winning bets, Betfair posted profits of $64 million, according to its annual report.

Its founders wanted to transplant the fundamentals of investment banking to sports. Now, Betfair handles 15 million transactions a day, or more than all of the European stock exchanges combined. Sports betting is legal in Britain; 8,000 betting shops are licensed and regulated by the government, as are the Internet gambling sites based here.

Betfair offers betting on major sports based in the United States, like the N.F.L., the N.B.A. and Major League Baseball. But it does not take any wagers from the United States or China, Japan, Hong Kong or India, places where online gambling is illegal. The men’s singles competition at the United States Open was the most popular tennis event on Betfair in 2007, with $307 million bet.

What Betfair brought to gambling was transparency. It has agreements with 32 sports governing bodies and is seeking more, promising to share in real time any unusual betting activity.

“We can tell you every single bet ever placed and who made it, from what funds and where those funds are going,” said Mark Davies, a Betfair managing director and a former bond trader. “It is a complete audit trail, and we want to share it with the governing bodies of sport.”

But many sports governing bodies have refused Betfair’s offer, Mr. Davies said, including the International Olympic Committee. During the 2004 Summer Games in Athens, Betfair matched $80 million in wagers on Olympic events. A spokeswoman for the I.O.C., Emmanuelle Moreau, said that the committee had taken proactive measures to address gambling threats. She also said it expected to have a system in place to be alerted to irregular betting before the Beijing Games in August.

“I have been told by one sport that they did not want to sign an agreement because they did not want to know the level of corruption that existed,” Mr. Davies said. “But it exists, and we’re just showing what has always been there.”

Still, others say that Betfair’s “in-running bets,” which may not necessarily affect the final outcome, are ripe for manipulation.

This month, for example, the British Horseracing Authority charged nine people, including a prominent trainer, Paul Blockley, and a jockey, Dean McKeown, with corruption, saying they shared inside information that their horses were not going to run well. The bettors, including five racehorse owners, had put money on horses to lose, which Betfair permits.

“Betting corruption existed before Betfair,” said Paul Scotney, the director of integrity services and licensing for the British Horseracing Authority, which has disciplined more than a dozen jockeys, as well as trainers and owners, with the help of Betfair’s data. “But Betfair offers other, and more, ways of cheating.”

More worrisome for Mr. Forrest, the economist and co-author of a recent study, “Risks to the Integrity of Sport From Betting Corruption,” are sports like tennis, in which a player can deliberately lose the first set against an inferior opponent so that the odds rise, then go on to win.

“It is a greater incentive for an athlete or official to participate in this type of manipulation,” Mr. Forrest said. “It is within their control, and they do not have to lose the match.”

Jenny Williams, the chief executive of the Gambling Commission, which regulates Britain’s gaming industry, said her agency was gathering information about in-running betting and its pitfalls.

“The jury is still out,” Ms. Williams said. “You can produce a theoretical risk, but we need to determine if it is going on.”

How many of the world’s sporting events are fixed? By virtue of the fact that match-fixing is a crime and most gambling is illegal, most economists and sports officials hesitate to guess.

The United States is hardly immune. On May 16, federal prosecutors asserted that the N.B.A. referee Tim Donaghy admitted to betting or providing inside information to gamblers on more than 100 games, many of them that he had officiated. The league said Mr. Donaghy was a rogue referee, but there are enough instances of gambling scandals in the world to suggest that match-fixing is also part of the American landscape.

In 2006, for example, Mr. Wolfers, the Wharton professor, after reviewing 16 years of college basketball results, found that point shaving had occurred in about 1 percent of the games. A Stanford economics student, Jonathan Gibbs, suggested in an undergraduate thesis that similar forces may be at work in the N.B.A.

In fact, the National Collegiate Athletic Association’s gambling survey of 21,000 athletes released in 2005 found that 35 percent of male athletes and 10 percent of female athletes said they had bet on college sports in the previous year. Of the 2,132 Division I football players surveyed, 1.1 percent (23) reported accepting money for playing poorly in a game. Of the 388 Division I men’s basketball players surveyed, 0.5 percent (2) reported such conduct.

A total of 2.3 percent of the Division I football players and 2.1 percent of the Division I men’s basketball players surveyed said they had been asked to influence the outcome of a game because of gambling debts, and 1.4 percent of the football players and 1 percent of the basketball players acknowledged actually affecting the outcome.

Mr. Wolfers said there was more to worry about in American sports, on which more money was bet illegally and without regulation. “There is a greater potential for corruption,” he said. “Bad guys are going to get away with more stuff unless we channel it into a legitimate economy.”
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Old 05-25-2008, 05:58 PM   #2
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betfair is absolutely huge mack!! I just hope the gambling commission don't ban in running on betfair! Especially with the amount of money I seem to be making on it!
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Old 05-25-2008, 06:04 PM   #3
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Originally Posted by jonny View Post
betfair is absolutely huge mack!! I just hope the gambling commission don't ban in running on betfair! Especially with the amount of money I seem to be making on it!

Good job too with all these terminations you gotta stump up for!

You might even have enough to get back to Thailand some time soon Jonny
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Old 05-25-2008, 06:07 PM   #4
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my internet got fixed this month too which has taken me almost a fucking year of constant complaints. Have spent some serious time on betfair since it got fixed 9 days ago!
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Old 05-26-2008, 12:02 AM   #5
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Good news jonny, betfair works well in LOS now.
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Old 05-26-2008, 11:55 AM   #6
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really?? Very interesting!! The delay will probably be too long to do what I do with the horse racing markets but for in play stuff the delay doesn't make any difference. Very interesting!!!
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Old 05-26-2008, 12:07 PM   #7
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I don't bet in running, so can't say. However, it seems to run as quickly as at home, so if you have the software that speeds things up you might be okay. Maybe put the question up on the betfair forum, I reckon there will be a few people in LOS making a tidy living from Betfair and will know the answer.
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Old 05-26-2008, 12:20 PM   #8
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maybe? The problem is I rely on speed and que position. Even if I was an excellent trader someone with a faster connection than me will just beat me to the money every time. Sorry when I meant in running I meant tennis, cricket and football. Not horse racing I'm not that pyschopathic!!!
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Old 05-26-2008, 12:53 PM   #9
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I'm going to have a go at betting in running when I'm at the cricket. My iphone has very good internet connection, especially when you can find a suitable wi fi.

Betting in running at horse racing is fascinating. If you go to Wolverhampton races you can see the punters on the top floor of the stand screaming down the phone as the race enters the final furlong. Like you I'm not crazy enough to get involved, but plenty are.
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Old 05-26-2008, 01:02 PM   #10
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unless you have a very fast internet connection a very good bot and an SIS subscription and are also very very good at race reading then in running horse racing should be avoided like the plague!!
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