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I’ve brought this story to attention on here as it concerns me that bookies are acting on inside information on an imminent withdrawal of a horse and lowering the price of said horse before withdrawal to bring a bigger rule 4 into effect.
I’m sure there will be plenty enough people left disagreeing/perplexed/outraged with the lenient fine given to the trainer as he has definitely got away lightly but that is not my main issue here. Here are a few snippets of the article on the RP relating to the incident. I have put in bold the comments from Ladbrokes Coral’s regulatory development manager Keith Page as they have left me a little concerned about the whole thing.
“On calling Ladbrokes on the morning of the race, the firm offered Evans 4-1 for a back bet of £6,000, better odds than the then currently available 7-2, about Black Dave in a 6f handicap at Wolverhampton in January 2015”.
Four minutes after the call, in which Evans told the Ladbrokes trader that Tango Sky was going to be withdrawn, the firm shortened Tango Sky to 3-1 (from 7-2), which resulted in the rule 4 deduction taking 25p from every £1 rather than 20p.
Evans declared Tango Sky a non-runner, with a vet’s certificate obtained the evening before stating the horse was “not sound”, almost an hour after placing his bet with Ladbrokes.Page said: “It’s a regular occurrence to offer a better price to a certain profile of customer or a long-term customer, while Tango Sky’s price was cut to bring it in line with industry prices at the time.
“There are two theoretical possibilities to the reason behind the price change – either it was a very cynical price change in order to affect the subsequent rule 4 or our traders were alerted to something not being right about the market, so they shortened the price of the market principal.
Its all a bit of a coincidence that the price was cut at that time. I’ve seen a fair few horses over the space of an hour or so have their prices cut down and then BAM all of a sudden its a non runner. It’s just a bit suspect.
More concerning than R4 imo is a trainer being rewarded for info by the bookmaker – effectively a concession with the price ‘enhanced’ of £3 grand had the horse won. It was a bung which would have allowed Evans, had he been willing to chance it, a nice profit by laying a horse who went off at 6/4 and lost.
Would this be classed as insider trading in the City?
No matter how you view it, it can only be seen as corrupt by both trainer and bookmaker.
Shocking really.Wow, so many thorny issues in play here that I had hardly know where to start.
Could anyone clear something up on the story itself? I don’t quite understand when it says that Tango Sky was sent off to the BHA as an NR an hour before the bet was placed. Am I reading that right? The BHA feed/trading platform delay is never more than a few minutes so the horse would have been an NR will all firms if that was true. But then part of the sentence against Evans was given because he was slow in notifying them of the NR.
Rule 4 manipulation is wrong, but I really don’t think it happens. The problem is that there ARE delays between the BHA website publishing a NR notification and their feed hitting bookmaker and exchange trading systems. Chivers is right – imminent NRs often get smashed up in the minutes before they get pulled. It’s often exchange-driven – anyone with inside info or a beady eye on the BHA website can trade around the NR on Betfair to improve their overall position. Most bookie trading platforms are exchange-linked at least in some way (trader is alerted if unintentional arb is being offered) so you’ll see the firms fall in line if something is getting smashed on the machine.
There’s no incentive to manipulate, though. IBAS and the Gambling Commission often get complaints from punters who suspect foul play. As a trader, I know if I had any sort of inside information and used it to manipulate the R4 deduction, the Gambling Commission would drain the swamp. If the price change didn’t marry up with large bets laid and exchange history, I’d lose my job.
The systemic problem is that there is a delay, right? On Sunday especially – short staff at third party providers – it can take as long as 10 minutes for BHA published NRs to be removed from our systems and the exchange. Again, FWIW, the BHA and our providers have moved to address this on prompting from the Gambling Commission and there will soon be no delay at all. Silver linings.
Also, I suppose it’s worth saying that the ‘legacy Ladbrokes’ horse racing trader involved in this case has never been employed by the merged company. This all took place pre-merger so I can’t shed any more light on what happened.
As to the case against David Evans, he certainly broke the rules on inside information by giving forewarning about an NR. If he hadn’t done that, I wouldn’t see anything else untoward in the transaction – he’s allowed to back his own horses.
Hi Joe
The purpose of the insider dealing laws is to try create/preserve confidence in stock exchanges by requiring that publicly-quoted companies make public as soon as it is available all information specific to them that might impact the price of their shares, so that everyone holding or wanting to deal in those shares has access to the same information at the same time.
The core obligation is that the company must notify the market, through an approved Regulatory Information Service (RIS) eg The Stock Exchange, as soon as possible, of any inside information concerning the company.
It is a crime to deal on the basis of unpublished price-sensitive information.
If Mr Evans was a quoted company and had told the bookie one hour ahead of time that he would soon be asking for dealing in his shares to be suspended, and that caused the bookie immediately to trade his shares, the bookie would be insider dealing and Mr Evans might be seen as facilitating that criminal act.
But in horserace betting there is no equivalent regulated market to that which applies in the case of quoted shares.
The information side – BHA and Weatherbys – have nothing to do with the betting markets.
The Gambling Commission is about licensing people and premises rather than anything near getting involved in price-movements in betting markets. As far as the GC is concerned, a bet is anything within the scope of section 9 Gambling Act 2005:
>>>>>>>
9 Betting: general(1) In this Act “betting” means making or accepting a bet on—
(a) the outcome of a race, competition or other event or process,
(b) the likelihood of anything occurring or not occurring, or
(c) whether anything is or is not true.(2) A transaction that relates to the outcome of a race, competition or other event
or process may be a bet within the meaning of subsection (1) despite the facts
that—
(a) the race, competition, event or process has already occurred or been
completed, and
(b) one party to the transaction knows the outcome.(3) A transaction that relates to the likelihood of anything occurring or not
occurring may be a bet within the meaning of subsection (1) despite the facts
that—
(a) the thing has already occurred or failed to occur, and
(b) one party to the transaction knows that the thing has already occurred
or failed to occur.
<<<<<<<<<<<<<If you search the Gambling Commission licence terms for the word >> inside<<, there is only one mention:
======
Ordinary code provision 4.2.8
Betting integrity
All betting operating licences, including betting intermediary, ancillary remote betting and remote betting intermediary (trading rooms only) licences1 Where licensees offer to accept bets, or facilitate the making or acceptance of bets between others, on the outcome of a sport regulated by a sport governing body for the time being included in Part 3 of Schedule 6 of the Act, they should take all reasonable steps to familiarise themselves with the rules applied by that body on betting, in particular betting by registered participants.
2 Licensees should ensure that a condition of their accepting bets is that for a bet to be valid, customers placing such bets must not be in breach of any rules about irregular and/or suspicious betting or misuse of inside information relevant to a sports governing body, other professional body of which they are a member, or their employers. Where a breach of these rules is identified, licensees should then take steps to void the bet.
======So as GB horserace betting is set up, Mr Evans and the bookie have done nothing unlawful by way of insider dealing.
Whether Mr Evans has breached his contract with the BHA as regards its rules about dealing with non-public information is a separate matter:
http://www.britishhorseracing.com/faqs/what-does-this-mean/
The press release talks of false position but then follows with just a £140 fine on the delay aspect:
http://www.britishhorseracing.com/news-media/racing-news/news-item/?news=P-711ab82e-6764-4642-a063-75742b585e86Short of mapping a regulated-market, Stock Exchange-type structure onto the activity of horserace betting it is difficult to see how the concept of insider dealing could be mapped across.
It of course becomes easier to prevent where the people running the racing also run the betting – eg the HKJC.
Lost Soldier: David Evans didn’t notify the BHA until an hour after he placed the bet with Ladbrokes that morning. He had the vets certificate the night before saying the horse was not sound
I guess he was thinking a 6k bet at 4/1 with a 25p rule 4 is better than 6k at 6/4.
There’s no issue on trainers betting on their own horse to win, obviously.The story does little to enthuse any suspicious punters though. I personally don’t see it much these days as I won’t bet in anything below a class 3.
Also from the article:
He continued: “Most punters would probably approve of what I did – none of my owners has taken offence.
Really? I’d love to hear from them. Most punters I know tend to disapprove of cheating.
Many thanks, wit, most useful as ever.
It seems then that we have a relatively unregulated market with a turnover of around £4.5bn annually ( https://www.statista.com/statistics/469783/gambling-turnover-horses-in-great-britain-betting-uk/) in which a bookmaker can reward a trainer for information the bookmaker can use to manipulate that day’s market by reducing potential liabilities.
Legal it may well be by the letter of the law but I’m struggling to find much difference on the intent side if the objective is the protection of investors in a ‘public’ market of substantial value. It seems the betting investor can expect no protection from the authorities. Could an argument be made that the Gambling Commission should act under its responsibility for protecting vulnerable people? They do not define that category:
5.17 The Act does not seek to prohibit particular groups of adults from gambling in the same way that it prohibits children. The Commission does not seek to define ‘vulnerable persons’ but it does, for regulatory purposes, assume that this group includes people who gamble more than they want to, people who gamble beyond their means and people who may not be able to make informed or balanced decisions about gambling due to, for example, mental health, a learning disability or substance misuse relating to alcohol or drugs.
It could make for an interesting case.
Hi Joe
Too much of a stretch IMO to try shoehorn all victims of inside-info-manipulation into the category of >> vulnerable people <<. (The BHA press release says there is “no indication” of any victim, but equally no clue as to how assiduously any indication was looked for.)
End of the day, the BHA licence the trainer and has taken some action against him on the horseracing side.
The real news would be if the Gambling Commission, which licenses the bookmaker, was ever to expand its self-written licence terms and take action on the betting side in such cases. Takes two to tango, after all and I agree what there is at the moment is oddly asymmetric.
But it is interesting that LostSolier 3 writes >> As a trader, I know if I had any sort of inside information and used it to manipulate the R4 deduction, the Gambling Commission would drain the swamp. <<. How many such interventions have there actually been by the GC ? [“no interventions because we never do anything wrong” would not be a credible answer to account for the asymmetry!]
I suppose everything would depend on the court’s definition of vulnerable, much as the definition of relegated was key to the Coral’s Rangers case. And, I suppose, the question . . . would vulnerability apply if it were, as it would be in these instances, a temporary condition?
How many such interventions have there actually been by the GC ? [“no interventions because we never do anything wrong” would not be a credible answer to account for the asymmetry!]
I’m aware of two reaching a formal investigation in the last nine months. No case to answer in both. Such cases led to the meetings between bookmaker and exchange reps, BHA, trading software providers & GC to optimise the links with the BHA non-runner feeds. The sooner this is delivered the better.
thanks, LostSoldier3.
so the GC is at least a little bit active in the area.
though there is only so much that can be done through “optimising the links” when the sport itself offers a huge loophole to strip information of the character of “inside information” in the first place.
consider:
http://rules.britishhorseracing.com/Orders-and-rules&staticID=126286&depth=3=====
Schedule 5 – Information regarded as in the public domain1. This Schedule specifies certain circumstances in which information is to be regarded, for the purposes of Rule 36.1.2 (communication of Inside Information), as being in the public domain.
1.1 It is not, and does not purport to be, an exhaustive statement of such circumstances.2. Information is regarded as being in the public domain where the information is accessible to the public on a Trainer’s or owner’s telephone information line or website (whether or not for payment).
3. Information is regarded as being in the public domain if both of the following conditions are satisfied.
3.1 The first condition is that a Trainer or a Rider gives the information or expresses his opinion on a horse in a race in the course of
3.1.1 an interview or presentation conducted in the course of television or radio broadcasting;
3.1.2 an interview given, or article written, for the purposes of general publication (for example a written article, regular column, or website);
3.1.3 a talk or other presentation given to a specific group or groups (such as corporate sponsorship groups) or in the context of corporate hospitality or stable yard public days.3.2 The second condition is that any fee paid to the Trainer or Rider for the information or opinion is no greater than that which reasonably reflects the occasion and his status.
===========nothing there about timing or about ensuring that the whole market gets the same information at the same time.
nothing like Schedule 5 would work in respect of a share on The Stock Exchange.
wonder if Mr Evans would still have been found to have engaged in “conduct prejudicial to the integrity, proper conduct and/or good reputation of horseracing in Great Britain” if – just before making his call to the bookie or telling Weatherbys – he had carefully followed Schedule 5 to strip the information of its “inside” nature through, for example, putting news of the impending withdrawal in an obscure part of his website, or in a recorded phone message, or phoning up a favoured journalist for a “quick interview” that had no chance of being published for several hours ?
wit, can I use some of the content you’ve published here in a blog article?
Thanks
Joehttps://www.theguardian.com/sport/2017/nov/29/trainer-david-evans-ladbrokes-non-runner-tip
Update from The Graun. Neither Evans nor Lads come out of that very well.
https://www.theguardian.com/sport/2017/nov/29/trainer-david-evans-ladbrokes-non-runner-tip
Update from The Graun. Neither Evans nor Lads come out of that very well.
And neither does the BHA and with all the skullduggery that has been revealed, how can we be confident Evans didn’t lay the horse back for a very healthy profit?
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