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Betfair punters lose out in verdict on £23m Voler La Vedette case 28/03/2012
Will Hayler
• IBAS arbitration service backs Betfair's move to void all bets
• The 34 punters who complained could make a legal challenge

Punters hoping for a share-out of the £23m "won" in controversial circumstances on Betfair last December met with a substantial if not unexpected setback on Saturday when the Independent Betting Adjudication Service (IBAS) backed the betting exchange's decision to void all the bets.

Voler La Vedette, the easy winner of the Christmas Hurdle at Leopardstown on 28 December, was available to bet in-running at 28-1 even as the mare passed the winning post and some 200 punters took advantage of the situation, staking a total of £800,000.

But in unprecedented circumstances, Betfair took the decision to void bets and refund all stakes, citing a software failure caused by "a unique set of circumstances". Betfair insisted that it would have voided the bets, regardless of the result of the contest.

An investigation showed that a customer's multimillion pound lay bet on Voler La Vedette at 28-1 had somehow bypassed the usual checks to be placed on the system. This would have resulted in a £600m liability for that customer had sufficient bets been placed on the horse. Betfair claimed that the situation had arisen as a result of the customer's rogue "bot" – a malfunctioning automated bet-placement programme.

After a meeting with the local Gambling Commission in Gibraltar, Betfair subsequently made ex-gratia payments to some of the punters concerned, mainly those who had played in the "place" markets on the race.

But others were directed to IBAS and the 34 punters who filed complaints were contacted on Saturday morning to be told that they would not be receiving any winnings.

"This has been an unusually high-profile dispute," said the IBAS managing director, Richard Hayler. "That it has taken longer than hoped to resolve it reflects the time and care given to the process by all of our Independent Panel members. I can assure all concerned that the final adjudication was published only after thorough consideration of every argument made, both by the disputants and the panellists themselves.

"As with every IBAS case, either party is entitled to request that the adjudication be reviewed, but only where there is compelling evidence produced that the adjudication was fundamentally flawed or based on factually incorrect information."

However, the option of taking legal action, most probably on a collective basis, still remains open to those same punters, many of whom have already taken independent legal advice over their position.

Indeed, the letter from IBAS to the complainants makes specific reference to Betfair's use of a clause stating that they cannot be held responsible for technological failures, saying: "The Panel are aware that many businesses and their websites have similar disclaimers, but we are not a legal entity and so offer no opinion as to whether such disclaimers would be in breach of the reasonableness test specified in the Unfair Contracts Terms Act (1977)."

Extracts from the IBAS ruling, posted on internet forums, reveal that the investigating panel considered a number of issues arising from the complaint, including whether a software failure could be considered the same as a failure on the part of person programming that software. Such issues will surely prove a central tranche of any future legal action, no matter how slim its prospects of success.

A response from Betfair said: "Following the incident at Leopardstown in December, a small number of Betfair customers lodged complaints with IBAS. Before making their ruling, IBAS carried out a thorough investigation into the incident and Betfair co-operated fully with that investigation."

On the track, Premio Loco claimed Saturday's main event, the Blue Square Winter Derby at Lingfield, under the expert all-weather jockey George Baker. Baker had the gelding perfectly positioned just behind a slow pace set by Our Joe Mac and his charge quickened up well in the straight to take up the running. The winner started at 5-1.

The well-backed Cai Shen, forced wide throughout from a poor draw, attempted to launch a challenge from the furlong pole but was unable to reach the impressive winner.

"I was not too fussed that the field was going slow as I knew we had the tactical speed to get out of trouble and it worked out ideally," said the successful rider, in between enthusiastic plaudits from Premio Loco's owner, Bernard Westley.

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