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Ian<br>would not customs and excise take any money owed to them first?<br>doubt if they ”think oh well there are some funds but they belong to the customers of this failed business”<br> In all other business’s monies owed to Inland Revenue and H.M. Custom and Excise take precedent over any cleints money. I can’t see how any betting exchange can be any different.<br>For those who live local and want to call in to the offices of S/O they are just up the hill from the railway station at Burgess Hill opposite the ‘Top House’ pub very small place by the way.
Seagull
The point here is that surely the client money is in client accounts NOT in the business. Of course if the business has been raiding client accounts that’s different, and it may not be recoverable, but I can’t see that creditors have access to client money. <br>I’m not holding my breathe about getting my money back though!<br>Rob
Ian,
Yes I know all that. There’s a difference between knowledge and confidence though. An irrational one maybe, but a difference all the same.
You know this yourself of course. Witness the e-mail backandlay sent me last night re-assuring me my money was safe.
Is it true that the Association of Exchanges, Betfair and Betdaq are to refund all Sporting Option clients who are owed up to maximum of £1000. as a proof of the associations integrity.
Cubone.
cubone
that is what the BETFAIR rep stated on ATR,there is also a rescue package for clients who are owed more
BETFAIR are going to contact all clients of SO in the next couple of days
Whats the chances (odds) of people getting their deposit account monies returned:( :( :( :angry:
I was told that the association of Exchnages were to front the salvage but betfair have done so on there own I can only say that no one in history has done such a thing and there have been many Bookmakers default during the past 50 years. and at no time did Hills or Ladbrokes say a word about integrity.
For those who beleaved in a challenge to the betfair monoploy you can forget it. im afraid.
Betfair will reign supreame for years to come and the offcourse industry can increase there one armed bandits.
Cubone<br>
Hi cubone
>>>>>>>>>>>>>>>>>>>>>>>>>>>>><br>… no one in history has done such a thing…<br><<<<<<<<<<<<<<<<<<<<<<<<<<<<<
I’m sure that’s right in the history of betting, but solicitors have been taking collective responsibility for decades, and without £1000 or 20% limits, for the bad apples among them who misapply client accounts.
Along with every other practising certficate renewee, I’ve just had to put £700 into the Compensation Fund for this year.  If there was a spectacluar failure, every solicitor in the country could be bankrupted under this obligation before any client lost a penny from a solicitor’s client account going walking.
That, and the incredibly detailed and specifically monitored statutory rules about Solicitors Client Accounts, is the ultimate protection available in terms of client accounts, not only in England but anywhere in the world.
Not even banks or insurance companies are subject to rules that protective of clients – there are relatively low compensation limits under the Financial Services Act for them, and the Bank of England has to try and persuade the banks to organise "lifeboats" if something spectacular happens.
The same kind of collective responsibility just isn’t applied in other areas of commerce. ÂÂÂ
The Gambling Bill is miles away from doing anything like that, and Betfair is to be applauded for showing the way, albeit with an obvious eye to its own commercial interests.
What folk have to realise is that when an exchange talks of "segregated" or "client" or "ringfenced" accounts, they are talking basically about an insolvency order of payment – if properly operated, the funds will not be part of the pool available for division among general trade creditors but will be reserved for distribution among the pool of clients responsbile for those deposit balances.
In an exchange context, there is no criminal sanction if client account funds are dipped into for other purposes, unless you can show a separate independent dishonesty offence such as theft/ obtaining a  pecuniary advantage by deception  – which is not the same thing as the imprudent or over-optimistic businessman trying to trade out of a liquidity crisis – he may be sad or mad but not necessarily bad.
best regards
wit
Surely using Client money to strengthen liquidity is theft? Is trading while insolvent not an offence?
hi bluechariot
Theft, whether in relation to client accounts or anything else, is defined in the Theft Act as "dishonestly appropriating property belonging to another with the intention permanently to deprive that other of it".
Each element must be shown:
– was there dishonesty, as opposed to misguided or imprudent acts?
– was there an appropriation (a wrongful exercise of owner-type  rights) ?
– was there property belonging to another?   If I take a £10  note from your pocket, yes: but if I owe you a debt of £10 but choose not to pay it with a £10 note that I own, then no there isn’t.  ÂÂÂ
<br>- was there an intention permanently to deprive? "it was a short-term loan/I just borrowed it/ I always intended to pay it back".
These are all specific technical features that have to be established in any set of events before it can be said that theft has occurred.
The answer to your first question is therefore "no, not necessarily at all".
Your second question is similarly dependent on establishing breach of specified elements.
Fraudulent trading requires basically showing theft and is a criminal offence.
Wrongful trading involves showing a point of no return having been reached in a company’s fortunes, and a downturn from that date.  In such a case if a director "knew or ought to have concluded that there was no reasonable prospect of the company avoiding an insolvent liquidation" then he could be ordered to make such contribution as the court thinks proper to the company’s assets – but its not a crime/ "offence".
Re Cubelock Ltd 2001 recently established that mere balance sheet insolvency does not in itself amount to wrongful trading.   In other words, your total liabilities may exceed your total assets, but so long as you’re able to meet your liabilities as they fall due – ie keep the balls up in the air – you’re not bound to stop juggling.
Ever since Mandelson and Byers decided that the reason the UK was not entrepreneurial enough was that there was too much stigma attached to being bankrupt, the law has changed to make insolvency far less of a burden – result, rocketing insolvency.
When the Enterprise Act 2002 came into force on April 1, 2004 (no kidding), the automatic discharge period for personal insolvency dropped from 3 years to 12 months or such shorter period within which the Official Receiver says he’s finished investigating the insolvent’s circumstances.
Some types of debt used to stay with you even after discharge – including originally student loan debts.  But then the law changed to make student loan debts wiped out on discharge of bankruptcy- hence student organisations now pointing to it as a possible route out of that burden (just borrow the money for the petition from your parents and bum around for a year until you’re discharged -sure you’ll have a black mark on your credit record, but how long before lenders then dismiss it as youthful indiscretion?)
By the way Seagull, the Crown lost its preferential creditor status for the last 12 months PAYE and NI and the last 6 months VAT, on 15 September 2003.  Since then it has been only an unsecured creditor for "assessed taxes", alongside trade creditors and business rates.
best regards
wit   ÂÂÂ
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Thanks, wit, for your very helpful reply.
Have you any idea whether Sporting Options took money on false pretences, giving people the impression that their money was ring-fenced come what may when they knew that such a promise was worthless, and do you know if doing so would constitute deception or fraud?
The recent e-mail from the Administrators for SO indicates that only about 3% of clients’ money still remains. If that money was deposited in good faith, in the honest belief that such an eventuality could not occur as a result of the ring-fencing procedures in place, then surely some redress should be available.
At the very least I would like to see the book thrown at these individuals.
Pru
Thank you wit for your very proffeshional reply.
I was of course stating that no defaulter in history has ever been bailed out by another ,but I should have made clear that I was refering to Gambling and its history.
I am not sure if the stimulation of an exchange market is actually illegal.
For example it would not be illegal for members of staff from playing the same markets. although it may not be ethical.<br>No doubt this is the erea the Gambling Bill will look at.
These are very worrying times for our THING,
Cubone<br>
Wit<br>I always learn from your posts thanks again.
My local newspaper which covers Burgess Hill where S/O traded from reports that Brighton Football club chairman Dick Knight was one of the main investors in S/O.
Hi Prufrock
I know nothing more about SO than has been reported in public about them – was never a client of theirs and have never looked at their trading terms, so have no information on what they did or didn’t promise clients.
The insolvency practitioners appointed are under a statutory duty to investigate the conduct of the directors in getting the company to this point, and to report on it to the DTI.
If anyone has any evidence of criminal wrongdoing, they could try getting the police involved – but I’ve not seen anything reported which points down that road.  Obviously these situations do cause anger and disappointment, but businesses fail for reasons other than criminality so need to be careful about what kind of inferrals are made at this stage.
I would just repeat that "ring-fencing" is basically just about trying in a technical way to put a particular group of creditors up the pecking order when divvying up the remains on an insolvency – it carries neither positive or negative connotations beyond that, and can be messed up and not achieve its objective for any number of reasons, culpable or non-culpable.
As a side-note, I did see that one of the directors of SO was named as a Paul Cooper with an address in Thirsk. ÂÂÂ
Wasn’t there also a chap named Paul Cooper who some 15 years ago made a small fortune in backing the high draw in trifectas in the Dick Peacock Handicap at Thirsk?
And – memory lane this – wasn’t it Zorro himself who once interviewed the latter Paul Cooper some 10 years ago in a pub in Bethnal Green on the short-lived racing magazine Going Behind which came out on VHS tapes?
Anyne know if its the same Paul Cooper?
best regards
wit  ÂÂÂ
Racing Post headline,
70% of daily business artificially created.
I agree with you Don, providing they didn’t use clients money, (looks like they did) they have not commited any offence.
What difference me laying even £100K a horse but not having the money in my pocket or in the bank or the immediate means of paying,
(could probably borrow it of D.J. seagull)!!!!
<br>artific ially boosting liquidity is not an offence.
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