Ethics and Morals in the Gambling World

20th May, 2017.

Quite recently on Twitter, there's been some conversations regarding ethics and morals in gambling, with particular reference towards 'palping' and also trap betting.  

For those of you unfamiliar with the term 'palping, a succinct description can be found here.  According to that link, Rebelbetting state that 'A bookmaker can cancel (void) your bet, claiming it was a palpable error (or a “palp”). This can occur when a bookmaker has made what they call “an obvious mistake”, such as reversed the odds of a match or some other kind of accidental error made while quoting the odds.'

However, what could be considered an obvious mistake?  

According to this definition, 'if something is obvious, it is easy to see or understand' and 'If you say that someone is stating the obvious, you mean that they are saying something that everyone already knows and understands.'  

This definition is very difficult to quantify in a gambling market, because a market is such because there are a difference of opinions.  I suppose you could suggest that it would be obvious that Chelsea would be favourites at home to Sunderland, but would that be obvious to - for example - someone who has had no interest in football throughout their entire life.  If I asked my mother, for example, who should be favourites in this match, she'd probably have as much chance flipping a coin to guess, as guessing herself.

Furthermore, ridiculous bookmaker offers such as this - 50/1 on a goal to be scored in the Premier League tomorrow - also muddy the waters.  Bookmakers are now trying to lure new customers by offering huge odds on a much likelier outcome and with such marketing practices, it is becoming harder and harder for all but regular market users to define what would be, and what wouldn't be, a mistake.

Logically, from my own perspective, an obvious mistake would probably be a typo such as offering 100/1 about a 10/1 shot, and not offering say, 3/1 when the rest of the market is offering 4/5, just because a bookmaker's traders have failed to do enough research, taken an incorrect view on an event's chances of winning or copied a rival's price.  

Related to this, my wife has worked in retail for her entire life and there are very clear rules regarding pricing mistakes in retail.  If an item is priced incorrectly, or has the wrong price tag on it, the item can be refused sale at checkout, but all of those items have to withdrawn from sale until it is priced correctly.  If a customer has walked out of the shop with the incorrectly priced item, having paid the lower price, then they are free to keep it.

This is quite clearly different to the gambling world, where bookmakers can change the price of a bet even after the event has taken place!  The 'palping' system is quite clearly in favour of the bookmaker - surely it would be fair to see legislation that if the price isn't altered by the start time of the event, the 'obvious mistake' must stand and the customer must be paid at the higher price.

Independent adjudication necessary to prove bookmaker ethics

In addition, in all cases of 'palping', an independent adjudicator should be able to access details to show that where an 'obvious mistake' was corrected, those who backed the other side are then paid out at their 'correct' odds - a much bigger price.  There is no evidence at all that this takes place, and there needs to be.

The bookmaker's system is much different to an Exchange.  According to Google, this is the definition of an Exchange.

I am sure most readers are fully aware that this model is markedly different to bookmakers, as it is peer-to-peer with no bookmaker involved.

However, the question of ethics in frequently illiquid markets - particularly the cricket run-line markets - has been brought into question on Twitter of late, and I thought I'd give my take on the matter.

No sympathy for 'victims' of trap-bettors

To summarise, there is often no lay price available on a particular runline, and some people have taken to offering back bets at well thought out prices to catch other traders out.  To give an example, if the best price is 2.38 to back, they might offer 24 and hope that someone lays at 24 thinking it is 2.4.

This thread yesterday on Twitter speculated that a 'trap bettor' would make a six figure profit if their bet won (140 run run-line in yesterday's IPL match between Mumbai Indians and Kolkata Knight Riders) and questioned the ethics surrounding this.  

What no-one mentioned was that the person who was caught out from this 'trap bettor' almost certainly had removed the confirm bet button from their settings - surely they would have realised their mistake if the confirm screen was available to them.  This is purely their own choice and such an issue, and its implications, should have been considered if and when they removed such an option.

Furthermore, to lose six figures on a particular market would suggest that the losing bettor was an experienced, high-stake user of the Exchange.  I'd have a lot more sympathy with someone in this situation if they were a complete novice, but it is difficult to find much sympathy for someone who almost certainly understands the interface.

Surely the entire point of an Exchange is that it is a free market - and anyone can offer any price, even prices which could possibly mislead others.  In my opinion, the person who lost didn't have 'fat fingers', as someone speculated.  They were purely and simply incompetent and rushed at carrying out their execution of their bet.

Another strategy mistake from an IPL franchise

Finally, on the subject of this particular IPL match, it was interesting to see that as IPL franchises frequently do, Kolkata got their tactics completely wrong in the second innings.  

Reducing Mumbai to 34/3 chasing 108, a very unlikely victory had turned into a possible one (if I recall correctly, Mumbai's price had risen from a pre-innings 1.13 to around 1.45) and Krunal Pandya came to the crease following the dismissal of Ambati Rayudu.

My T20 database shows that Krunal has scored at the incredible strike rate of 205 against spin from the 2016 IPL onwards (prior to yesterday's match) so you would assume that someone in the KKR brains trust would know this, and take the spinners off.  However, this was not the case and he scored 30 in his first 18 balls against spinners Sunil Narine and Puyush Chawla, completely taking the match away from KKR.  

Krunal is still strong against pace - he strikes at around 145 against pace in the same time period - but given the huge discrepancy, KKR should have turned to Nathan Coulter-Nile, Umesh Yadav or even Ankit Rajpoot, whose bowling expectation is not bad at all.  

On the subject of Rajpoot, I would also question the wisdom of selecting a number 11 batsman and giving him just one over when the match was already lost.  If you are going to do this, it surely would be better to pick an all-rounder who can add stability with the bat.  As KKR picked Rajpoot, they should have already rationalised the fact that he would need to bowl overs, and probably quite early ones.