Sports betting and corruption: How to preserve the - SportAccord

Sports betting and corruption: How to preserve the integrity of sport
Professional gamblers
One section of the betting public consists of professional gamblers, who act on the betting market as
they would on a financial market. They perform statistical calculations to understand the ways in
which odds change and take advantage of these variations to place sure bets , i.e. combinations of
bets will win, irrespective of the score of a match. For example in a match between a team A and a
team B, one can bet on three possible combinations (A wins, drawn match, B wins) with each operator
that is offering the best odds, and on each of the three possibilities. A gambler who spreads his risk in
this way is assured of winning, irrespective of the issue of the match. Professional gamblers (and
money-launderers) spot these opportunities and can place extremely large sums and obtain maximum
profit without taking the slightest risk! As in the less well-regulated financial markets, these players
scrutinise the movements of the odds, and by substantial and repeated bets, can in fact themselves
swing the odds accordingly. This group of gamblers also pays great attention to information about
sports matches. If for example a person learns that two key players in a team will not take to the pitch,
they might then decide to bet heavily against the team, even before the operators receive the
information and adjust their odds against this team. That being the case, a more or less irrational
variation in the odds may make other professional bidders think that the score of that match has been
determined in advance and that the drop in odds is the result of corruptors who are betting massively
on one side in the match. They will then also leap into the breach and bid massively, before the odds
drop too low, which will push the operator - alarmed in the face of so many bets on one team - to
continue to increase the odds against the team.
The mechanisms of sports betting are therefore similar to the sheep-like and aggressive behaviour to
be found in financial markets. Generally, betting operators know these legitimate professional
gamblers ( wise men ), because they often place substantial bets and their identity is not necessarily
hidden. It is in their interests to take responsibility for their conduct and show openly that they have a
great deal of money at stake on the activity. It is impossible for an operator to know if a large bet is the
result of an instance of corruption. The bet may have been placed by a legitimate professional gambler
or, as we have seen, a regional Asian bookkeeper who is placing a multitude of street bets on an online
site through a single bet.
Hedging risks, or covering the risk of fraudulent betting by a section of the market
Risks are generally hedged according to the number of exceptionally high bets recorded by betting
operators across their entire offering. If an operator loses 500,000 on a bet, that can be offset by the
millions of euro in profits that they amass over time. Also, if an operator records a substantial loss on
one match in particular, they can always offset that loss by briefly lowering the odds on other sporting
competitions in order to increase their profits, before returning the odds to their normal level once they
have recovered their losses. As a general rule, the largest operators have substantial liquidity that
enables them not to worry if a client account makes a profit, even to an excessive extent.
Risks can also be hedged by transferring them to another operator. We have already analysed these
inter-operator hedging operations, which are both common and easy. A very large bet relating to
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