The Betfair betting exchange was forced to void millions of pounds in bets on one of its "in-running" markets on Wednesday, following an unprecedented series of events that appeared to leave a sole Betfair client with a liability of nearly £23m and about 100 customers of the exchange briefly celebrating an unexpected Christmas bonus.
Betting on races as they are taking place has become increasingly popular on Betfair in recent years and frequently sees horses backed at the minimum price of 1.01 (equivalent to odds of 1-100) when apparently sure of victory, only to be overhauled in the final strides.
The in-running betting activity on Wednesday's Christmas Hurdle at Leopardstown, however, was more extraordinary than anything in the exchange's 11-year history. Voler La Vedette, the second-favourite for the race, was going easily from the start and appeared the likely winner from a long way out. She duly came home several lengths clear of Mourad, the favourite, but the in-running betting patterns bore no relation to her easy path to victory.
With less than half of the race's three miles completed it suddenly became possible to back Voler La Vedette at a price of 29 (equivalent to odds of 28-1), even though her starting price was 13-8 and she was travelling smoothly. What was even more remarkable than the price on offer was the amount of money – nearly £21.5m – that someone was apparently willing to accept at 29, with a potential loss of nearly £600m.
In all approximately £800,000 was staked on Voler La Vedette at 29 as she made her way to victory, implying a payout to her backers of about £23m. However, while an "in-running" market would normally be settled within a few minutes, the apparent winners were not paid out as Betfair investigated the bizarre circumstances.
Nearly three hours later Betfair issued a statement which said that the entire in-running market on the Christmas Hurdle had been declared void because of "an obvious technical fault which allowed a customer to exceed their exposure limit", and that "in accordance with our terms and conditions, all in-running bets on this race, both win and place, will be made void".
The statement, issued by Betfair Customer Service, added that "we fully appreciate the dissatisfaction this will cause many customers, and apologise for a very poor customer and betting experience".
The popular "Forum" section of the Betfair website was alight with speculation throughout Wednesday afternoon, with some customers of the exchange insisting they felt they had been robbed of thousands of pounds in "winnings" and would consider taking legal action against Betfair as a result.
Other Forum users pointed out that mistakes – such as inputting the wrong odds, missing a decimal point or clicking "back" instead of "lay" – are relatively common on Betfair, particularly in the frenetic in-running markets, but that those who make them do not expect to see markets voided, or their losses returned, as a result.
Later on Wednesday evening Betfair issued a further statement that said: "In response to a number of customer questions on this matter, we would like to clarify that the account in question has no commercial relationship with Betfair other than being a customer." The exchange is also conducting an internal investigation into the precise cause of Wednesday's events.
guardian.co.uk © Guardian News and Media Limited 2010
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