What is the right time to settle bets on the US Presidential election?

VIEW FROM THE OFFICE - WEDNESDAy 16tH DECEMBER 2020

The Tattersalls Rules governing betting on horse races on British racecourses were first published in 1886. When IBAS issues rulings referring to ‘Tattersalls Rule 4’ we’re typically dealing with deductions made from winnings because one of the horses due to run when the disputed bet was placed was latterly declared a non-runner. However, that is only part ‘c’ of Rule 4, which begins:

“Other than ‘first past the post’ bets, all bets will be settled according to the result as announced at the ‘Weighed-In’ with the following exceptions…”

When racing’s first betting rules were being drawn up it was clear that one of the most important questions to answer was “When is the right time to pay out?” The rule has held firm ever since, although most online betting operators typically settle bets considerably faster, sometimes leading to further complaints if the winner is disqualified before the ‘Weighed In’ announcement and prematurely paid winnings are then quietly deducted from the customer’s online account balance.

The principle of a pre-determined point after an event for settling winning bets is vitally important. It always has been, but it is even more so in an era when an increasing number of sporting disputes are ultimately settled in the courts or through other quasi-judicial procedures.

In sport, many bookmakers talk about the lifting of the trophy as being the determining point for settling winners and losers. Others rely on official announcements by named third party media outlets or by the governing authority of the sport concerned.

In IBAS’s eyes, there is no doubt that this approach is sensible, practical and delivers the greatest good for the greatest number of consumers. Of course, that is of little consolation when, for example, your unfortunate selection is promoted from second to first following a long or detailed post-event inquiry/investigation.

'DO THE RIGHT THING'

We must receive 50-100 emails or claim forms each year asking for a bookmaker to ‘do the decent thing’ and honour a bet that was settled as a loser on the day but later determined by some other approach to have been a winner. Sometimes businesses do make a decision to pay out on these bets, but IBAS has never ruled that they are obliged to. If we did, what we would be saying is that bookmakers ought to withhold on paying bets until they were satisfied that no technical or legal challenges to the result were likely to emerge.

That would mean, for example, that bets on goal scorers in Premier League football matches may have to wait until after meetings of the Goal Accreditation Panel and bets on red cards might need to be left open until any appeals against sending offs had been heard. 

Rule G7 of the BHA Rules of Racing says that the BHA may correct the result of any horse race within 14 days of it being run, if an incorrect result is declared. So should all horse racing bets be left open until then, just in case?

Perhaps it would be safest to leave bets unsettled for even longer. It wasn’t until 2012 that Lance Armstrong was disqualified as the winner of the 1999 Tour De France. Although it may not be a particularly pleasant thought, with continual developments in anti-doping science, it is entirely possible that people recognised today as legitimate champions may be stripped of their titles at some point in the future.

As of today (16 December) Donald Trump remains adamant that he will yet prove he was the legitimate victor of the 2020 US Presidential Election. It is clear too that he has many supporters of his cause and that the decision of the US Supreme Court to refuse a block on Electoral College votes being officially declared is unlikely to be the last legal challenge made either by the Republican Party or by Trump himself against the apparent outcome of the election.

Without making any assessment about how likely it is, it is clearly possible that there may yet be a successful legal appeal against Joe Biden’s election victory. It is possible too that voting irregularities will be identified in such a way that a new election will be called or the result will be otherwise overturned.

THE IBAS APPROACH TO SETTLEMENT TIMING

The important question from IBAS’s point of view is whether it is sensible, reasonable and fair to delay the settlement of bets for Biden backers in the meantime. Indeed, there is a legitimate basis to ask whether bets on the election winner should be settled before the new President is inaugurated, a ceremony due to take place on 20 January 2021.  

A number of people have called the IBAS office in the past week to complain that their bookmaker has prematurely settled as unsuccessful their bet on Trump to poll the most votes, to win a particular state or to win the election outright.

If IBAS was asked to adjudicate on such a complaint we would look at a number of factors. First of all the betting rules of the business in question: Do they set out the point at which bets on US presidential elections will be settled? Has that point been reached? Were the rules in place before the disputed bet was struck?

If there were no rules in place or if the rules were ambiguous, we would look at other factors. Our Adjudication Panel would be asked whether, on balance, the affected betting markets had been managed fairly. That would involve thinking about the position of Biden backers (and backers of other candidates) as well as backers of Trump. We would ask whether a company had acted reasonably in the approach they had taken and in the unusual circumstances of a protracted, legally contested US election result.

We fully understand the concerns that people would hold that their bets have been treated unfairly, particularly if they also have reason to believe that the contest itself was not conducted fairly. However, we also have to consider the practical barriers that come with establishing the end point of a bet. At some stage a decision has to be made that the time is right to say who has won for betting purposes. For the vast majority of bettors, they would prefer that point to be reached sooner rather than later.

HOW ARE WE DOING?

Total Value of Payments Awarded or Conceded to Customers in 2019.
£634,426
Total Requests for Adjudication.
6,282

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