Betfair issued its “full and final” report on the “technical glitch” that resulted in the betting exchange voiding in-running bets at Wednesday’s Christmas Hurdle at Leopardstown. In what was characterized as both apology and explanation, a “personally devastated” acting CEO Stephen Morana stated that the unnamed punter that had offered the 28-1 odds on 13-8 second favorite Voler La Vedette had less than £1k in his account at the time. Despite these fiscal limitations, the punter had accepted over £800k in wagers from around 200 other punters, resulting in a liability of £23m. Had the full £21m in offers the overly generous odds had generated been accepted, the punter would have faced a theoretical liability of £600m.
Morana also confirmed that the punter’s loony largesse was the result of a ‘bot’, or automated betting software, gone rogue. Betfair’s Application Programming Interface (API) is custom designed to facilitate the use of such bots, but the punter’s bot “had developed a fault, causing it to try and place a very large number of bets on the exchange. These bets were large in size and mispriced … the customer had less than £1k in their account so none of these bets should have been accepted. However, due to a technical glitch within the core exchange database, one of the bets evaded the prevention system and was shown on the site. This was an issue that was triggered because of a unique sequence of events that had never happened before … We’ve taken steps to prevent its reoccurrence in the future. Lessons have been learnt in terms of how quickly we need to respond and how we need to communicate with our customers.”
Morana later told the Guardian that before this as yet unexplained “unique sequence of events” transpired, he would have believed “that this was something that could never happen, the odds against it were just infinitesimally large.” Acknowledging that the explanation/apology won’t necessarily satisfy punters who feel they’ve been wronged by this incident – and could deter these and other punters from using Betfair in the future – Morana described the brouhaha as a “body blow, which undermines the trust we’ve built up with our customers, and we’ve got to prove to people that it was a one-off.” Betfair’s stock fell for the third consecutive day, although Friday’s drop of 7.5p (1%) was less than the losses of the two days immediately following the incident.