What will happen to Betfair?

[newexchangeneeded]

Betfair are charging 40%-60% of profits to some winning customers. Their share price has dropped over the last year around 50%, and is down 8% in the last couple of days. I understand that HMRC think that Betfair should have paid VAT on commission fees collected, because Betfair did not bear the risk of the bet, and this could cost them a nine figure sum. Also there have been a number of questions raised about transactions on Betfair that look like money laundering - Manchester United matched at 14 pre-event, when they should have been 1.05 was one example I was shown. And there are claims that they have done little about the many fixed matches in football, tennis and cricket, even though they know the identity of the culprits. Many a draw has been backed at odds-on pre-event, and such odds can only mean corruption. I know that log files have been sent to SOCA.

In the US, the DOJ shut down poker companies just on the whiff of money-laundering. I have no evidence - other than that I have stated, and each customer should take his own decision.

[admin]

i thought betfair only took like 5% max of every bet?

[steclarke]

mmmm get me millions out then ?

[newexchangeneeded]

i thought betfair only took like 5% max of every bet?

No, they charge 40-60% of profits to consistent winners.

They should have indicated in their prospectus when they floated that there was a potential VAT liability - there is nothing that I can find there. The 2006 case Commissioners v United Utilities is clear that they should charge VAT when they do not bear the risk of a bet.

Also the Gambling Commission or SOCA should investigate money-laundering over many years. Federer was matched at 33-1 before his last match - he went off at 1.01! It is all too easy to ask for a price that only the launderer will take.

And the conflict of interest from being an "integrated sportsbook and exchange" is too great. Their bots do not have a 5-second delay, and "know" whether the bet is offered or asked for by winners or losers. The losers will still get matched, but the winners will not. Just as with bookmakers and successful punters.