A not so Classic experience

This one came across the Fair Wagering Australia desk yesterday.

A punter writes:

——————-

My ire has been raised and I’m in the mood for a rant!

Following is the complete story of my experience with NSW regulated online “bookmaker” ClassicBet.com.au who label themselves as “Australia’s first premium betting agency”.

I first became aware of their existence through a cold call offering me a generous bonus to sign up and bet with them.

I monitored the site for few days and saw very little to excite me. Vanilla odds for sports didn’t turn me on. But given that I have so few options available to me I thought perhaps it won’t hurt to give them a try. And the bonus offer of $1,000 in free bets for a $2,000 deposit with x3 turnover was sufficiently enticing.

Their site boasts the following noble statements:

“ClassicBet strongly supports the ‘Ideals and Objectives’ as set out by the Australian Bookmakers Association … We are particularly committed to demonstrating responsibility and providing excellent service”.

(Subsequent enquiries have found that they are not members of the ABA, though they have applied for membership.)

“A premium level of service with no equal. Every client is provided a client manager who will be available to assist you in any way possible”.

(I’m still waiting to be advised of who my client manager is/was or receive any contact from him/her, or assistance from anybody.)

Frankly I fully expected that my stay would be short as I just “knew” that they’d close my account before too long. But I didn’t expect it quite so soon and with the consequences which followed.

So, I proceeded to open an account and made a $2,000 deposit. I went straight into action in order to establish the required turnover and placed a couple of bets on the footy. As luck would have it, both lost and my account balance was back to $0!

Time to place a bonus (free) bet. I found a golfer at somewhat close to competitive odds and asked for a bet on him. But I was then informed (contrary to what I’d previously been told) that bonus bets can be placed on racing only. No sports!

So, I went to check the bonus bet rules published on the site and found:

“a) For any promotion where bonus bets are received, the corresponding deposit must be turned over three times, at odds of $1.50 or greater before a withdrawal can be processed.
b) Bonus bets can be placed in any amount from 1 to 500 on any event, including multis and exotics.”

Protest lodged but dismissed.

That dimmed whatever enthusiasm I’d had for the site so it was a couple of weeks before I revisited and made a $600 deposit specifically to place a footy bet for $585 on a game which was to be played the following day.

I also spotted a decent price for a horse (7.50) which I fancied and asked for a $200 free bet on it. The response received was “Rejected (odds changed)” and it was promptly turned down to 5.00.

Yet notwithstanding that the bet had been rejected my bonus bets balance was reduced by $200!

Undaunted, I went in again and requested another $200 free bet at ‘best tote + SP’. Finally, a free bet accepted! The horse won at 3.5 and I was credited with winnings of $500.

Let’s try another! I asked for a free bet of $200 at ‘best tote + SP’. This time the response received read: “Rejected (account closed)”!

Yep, that’s right, I had three sports bets for two losses ($2,000) and one pending ($585) and a single (free) racing bet which won me $500. And that was the point at which (according to subsequent advice) they deemed my account to “not be recreational”.

Now, it really comes as no surprise to have yet another account closed but frankly I didn’t expect it quite so soon and in such circumstances.

I accept that they do have the legal (though not moral) “right” to do that. But what I don’t accept is that they have any right to deny me the remaining $800 of free bets which was a significant condition of my joining and depositing $2,000.

Further, in correspondence with Mr Ryan Kay of ClassicBet, he insisted that I had used up $600 of my free bets which of course is nonsense as they accepted only $200 and rejected $400 of my requests. I have a screenshot to prove it.

Having failed in my demand for them to honour their commitment to me I forwarded a formal complaint to the NSW OLGR.

I was suitably impressed with the OLGR’s prompt response to my complaint.

But not so impressed with their finding that ClassicBet “has not breached the Rules or Legislation” quoting: “3.1.2 Discretion of sports bookmaker. (c) A sports bookmaker is under no obligation to accept any wager from any customer or prospective customer”, and

“3.5.6 Internet betting access may be denied without notice
The sports bookmaker may cease to provide access to a customer to
the web site of the sports bookmaker to place bets via the Internet at
anytime. This may be done without notice to the customer.”

At this point I make the observation that I wasn’t denied any sports bets, only racing bets, so I’m not sure what relevance quoting that legislation has.

They then went on to refer to ClassicBet’s own terms and conditions, copying and pasting those pertaining to bonus bets:

“9. Bonus Bets
a) For any promotion where bonus bets are received, the corresponding deposit must be turned over three times, at odds of $1.50 or greater before a withdrawal can be processed.
b) Bonus bets can be placed in any amount from 1 to 500 on racing events (free bets cannot be used on sports or multis unless specified by client manager). Bonus bets are subject to the rules in Section 9. on the Acceptance of Bets.
c) Rules may vary on some promotions and any variance shall be displayed on the promotion
d) If after opening an account, clients are provided bonus bets without making a deposit, before they make any withdrawal, they must deposit at least an equal amount and turnover the deposit amount three times (after making the deposit).
e) Referral promotion. The referring client will be provided with referral bonus once the referral has deposited at least $200 and has turnover of at least $600 (at odds greater than $1.50.
f) Bonus bets are provided at the discretion of the Bookmaker and can be held back or withdrawn at any time.”

Note the differences and additions to the rules which I quoted previously?

Those changes were made only after I complained. They are not the rules which were on the site when I joined and by which our contract should be bound. I have a screenshot which proves it.

And further:

“10. Placement and the Acceptance of Bets
a) All bets on an Account are considered to be placed and received in the State of NSW, Australia.
b) Classicbet reserves the right at any time to refuse any bet or part of a bet without providing a reason or advance notification. The circumstances in which we may refuse a Client’s bet include but are not limited to:
i) Client is or may be less than 18 years of age;
ii) Client is or may be betting on behalf of a person who is less than 18 years of age;
iii) Client is or may be in breach of these Rules;
iv) Client is or may be in breach of any applicable law; or
v) Client’s proposed bet would present an unacceptable liability risk to our business. Whether there is an unacceptable liability risk to us for the purpose of this Rule is at Classicbet’s discretion.”
I most certainly wasn’t in breach of clauses i) through iv) and haven’t been accused of being so, so the conclusion therefore is that my request for a $200 free bet on a horse which was at less than 3.00 in the market represented an “unacceptable liability risk” to ClassicBet!

On a more positive note, ClassicBet did promptly pay me the balance of my account which included a dividend of $1,111.15 on the footy bet which was pending at the time they closed my account.

Additional observations I’d like to make about this experience:

1. I am advised that, unlike the TAB in NSW, bookmakers are not obliged to lay clients a horse for at least $1,500 but even if they were, there is nothing stopping a bookmaker from avoiding that obligation by simply terminating his account.

2. I have no legal qualification but in 40+ years business experience I’ve picked up a few things, one of which is my understanding that notwithstanding the strict wording of terms and conditions, the exercise of discretionary provisions requires adherence to principles of FAIRNESS.

3. Are regulators concerned only with the letter of the law? Are they not responsible for the protection of consumers and monitoring the ethics of licensed persons?

4. It is quite clear that punters in Australia have very little opportunity to obtain justice in disputes with bookmakers. The State regulators are next to useless, almost always siding with the bookmakers who effectively fund them. And for some incomprehensible reason I am repeatedly advised by Fair Trading offices that they have no jurisdiction in gambling related cases! Why ever not?

End of rant (for the time being).

Debunking The Spin

Sportingbet pay the King of Spin, Shane Warne $1 million a year to be their brand ambassador. Their adversaries, Sportsbet have saved a million by having their own in house King of Spin, Cormac Barry.

Most of you would have heard the almighty load of self-interest inspired spin that Cormac Barry and Mary Collier of the Australian (European) Wagering Council served up to racing’s most informed and relevant voice Shane Anderson earlier in the week.

They shit they spun troubled me so I felt a need to debunk it.

Let’s start with Mr Barry who took over Sportsbet 2-3 years ago after the Paddy Power buyout.

Cormac told us what innovators he and all the other corporates are, and how much they do for the punter. Shane asked him are punters really getting great service if a lot are getting barred?

Cormac’s response was – “The genesis of customers being banned came into place with the advent of turnover based tax”. Ahhh, no, mate – Sportsbet and Sportingbet ferociously barred punters all the way through the early 2000’s as they were paying no tax at all to RVL, Racing NSW etc.. So that’s that one out of the way – moving on.

Cormac suggested that corporates could service low margin or “winning punters” if a gross profit based turnover model was introduced for low margin clients. Claiming “we lose to the punter and then lose to RVL as well with the present system”.

Seems a pretty stupid idea to me – if I win off Sportsbet they pay me but nothing gets returned to the industry? Further, you promote yourselves as the “fixed odds specialist”. Fixed odds come with risk management – you’re a bookie – if you lose, that’s your problem, not RVL’s. Okay, taken care of that – moving on to Cormac’s corker!

Unprovoked, Cormac went on to claim that the main reason winning clients are barred is because –

“There’s an assumption there is perfect information in the market”

“We can’t be sure if a punter is continuously getting good information, that that information isn’t questionable”.

“In a perfect world where if there was no integrity issue I would have no problem taking bets off all punters”

Luckliy Ralph Horiwitz, Shane’s co-host, reined him in on this one. It was a baseless, deeply unqualified statement. Cormac should have retracted it and apologised immediately – but he didn’t.

I was offended. I’ve been barred by just about everyone – does that mean I’m a hot worker?

Cormac insulted all punters and the industry at large. Not to mention Australian stewards who are proven to be the best in the world.

Where there is money there will always be corruption and bookmakers must protect themselves and sports from corruption, but to claim that’s why punters are barred was disgusting.

I didn’t agree with one word Cormac said. I feel he missed the biggest point of all for corporates in the new tax structure – the per meeting charging of the new tax. He and Mary never mentioned it, maybe because their businesses are so fat they win every day so they need not worry about the unfairness of paying turnover tax on losing days and gross profit tax on winning days.

Mary Collier trotted out the “we reject 1 in 10,000 bets” line when pressed by Shane about account closures.

What is this stupid line? It made no sense when they produced it 8 months ago and it’s still just as irrelevant. All the bookies she represents except for Unibet don’t reject bets, they either accept your bets or shut you down. Unibet who are respected as being one of  the fairest bookies in Australia might reject 1 in 10,000 bets – is she referring to them?

None of the “vocal minority” as she labelled us are complaining about rejected bets – we’re sick of being straight up shut down.

And this is the genesis of my problem with Cormac and the Australian (European) Wagering Council – if they want the respect of the horseracing industry and the community at large they need to stop the groundless spin and start telling the truth about their business models. At present the Govt. are allowing their business model so what’s there to hide?

 

Racing VIC drop a bomb

Racing Victoria has set the cat among the pigeons today with their announcement of a new set of product fees for betting on Victorian Racing product, all to take effect in just over six weeks.

Instead of the current 1.5-2% turnover rate, the new scenario would see 1.5-3% turnover or 15-30% of gross revenue – whichever is greater. Racing Victoria had previously supported the turnover model fought so hard for by Racing NSW in its court battle with the corporates.

Interestingly, it is to be applied on a per meeting basis, which does seem unfair. i.e. If a Corporate turnovers $1 million on Melbourne Cup day and wins $300,000 they pay $90,000 to RVL – they then back up on Oaks Day and turnover $1 million again and lose $300,000 they pay RVL $30,000. They’re square for the 2 days but they’ve paid RVL $120,000. If they’d broke square both days they would have paid RVL only $60,000. Corporates and on-course bookies have a right to be upset about that.

Australia’s biggest operator TABCORP, were supporting Racing NSW in it’s corporate battle. Now that the Victorian racing authority has changed tact with a gross revenue model, TABCORP won’t escape this money grab. They have already announced a $4 million earnings hit for the next financial year.

So what does in mean for punters and the continuing battle for fairness in the Australian wagering landscape?

It’s quite difficult to get an accurate idea, but you can bet that it will be the punters who in one way or another will end up the losers.

Foreign corporate raiders are hardly going to settle for a lower return on their investment here – and the local giants TABCORP and Tatts have shareholders to answer to and revenue targets that won’t be reduced.

Further restrictions and account closures on winning punters will be inevitable. Perhaps we will even see more restrictions on punters who only lose 1-5% of their money. That makes it more important than ever that regulators such as the Northern Territory Racing Commission finally stand up and do something about fairness.

The Australian (or is it European?) Wagering Council’s (AWC) response smacks of hypocrisy as usual. Firstly, let’s acknowledge that the AWC is made up of Bet365 (UK), Sportingbet (UK), Ladbrokes (UK), Paddy Power (Ireland) and Unibet (Euro). There isn’t too much “Australian” about it – it’s a lobby group for foreign interests.

The soon (if not already) to be 100% Crown-owned exchange Betfair are also a member. We’re not quite sure why as in the past they have even disassociated themselves with AWC statements. (Mind you, this decision does have a huge impact on their business also – could they dump Australian racing altogether?)

Anyway, the main argument put forward by the AWC is about integrity and the risk that less competitive prices will lead to a rise in “illegal and offshore betting”.

This may well be the case, but how convenient is the argument now?

Closing winner’s accounts, restricting punters to $1 bets, advising punters that they are “uneconomical” because they have the temerity to win – all factors that drive punters offshore or underground. Integrity doesn’t seem to be an issue when punters are the ones being disadvantaged through a money grab.

Perhaps racing needs to sort out its sustainability issues on its own. Is there too much racing? The answer is most certainly yes.

You can’t help but feel this new fee structure is aimed at getting more of a return for the industry from corporates betting tote odds. Maybe restricting Corporates to only being allowed to bet fixed price and charging them a 1% turnover tax and then 2% turnover tax on Group 1 racing days would be advantageous to all.

If this were adopted, racing regulators and the Tab would have to look seriously at dropping tote pool take-out rates. They’d be loathe to but they are staring down the sports betting juggernaut that charges its customer on average 13% less than racing.

It’s a fine balance between having enough money to sustain a healthy racing industry and then starting to drive punters away to lower margin sports betting.

One thing is for sure, bookies will be passing on most, if not all of the added cost to punters through greater risk-management. Winning will get a lot harder – if it wasn’t hard enough already. If it becomes too hard to have a win, then racing and its direct participants will be the ultimate losers.