Sporting Options Failures Released in Report
A report from the administrator of Sporting Options paints a clearer picture of the failed betting exchange's collapse.
Menzies Corporate reports that Sporting Options ceased trading with total debts of £5.4 million, including £3.5 million owed to its betting clients. The collapse makes Sporting Options the most expensive failure in the modern history of the betting industry.
Competing exchange Betfair came up with a bailout scheme a few days after Sporting Options went under and has already paid out £1 million to former Sporting Options customers. Fifty percent of clients owed money by Sporting Options have taken advantage of the offer, although only 10 percent of the money owed has been paid.
The most revealing part of the Menzies report is the confirmation of the widely speculated rumor that Sporting Options was seeding its markets since the start of its operation. The seeding was mostly done through money raised by the site's founder, Kevin Griffiths.
According to the report, Griffiths, a former City trader, had already raised almost £1 million in seed money from friends and relatives. "After the launch," the report states, "it became immediately clear to management that in order to develop [it would be necessary] to seed the markets to create liquidity and attain a critical mass of clients to support the business model."
Even as late as October 2004, Menzies reports, Griffiths injected £70,000 into the market, but as a trading table shows, the company was not profitable. (Turnover for the fiscal year to April 2004 was just over £1million.)
Menzies is recommending two conclusions to an initial creditors' meeting at Eversheds Solicitors in Queen Victoria Street, London on Jan. 18: either creditors' voluntary liquidation or if unsecured creditors, including Customs and Excise who are owed £250,000, cannot be satisfied, deregistration for the company.
Click here to read the full report.
New Jersey a Step Closer to Legal Sports Betting
A New Jersey Assembly committee moved a step closer to legalizing sports betting in Atlantic City casinos this week when it approved a measure to allow New Jersey voters to cast ballots on the issue. Members of the Assembly Appropriations Committee voted 8 to 1 with two abstentions to approve the bill. Casting a shadow on the measure is a federal interstate commerce regulation that permits sports books in just four states (not including New Jersey). Proponents said this law could be challenged because New Jersey bets would be placed in person at casino windows, exempting them from interstate commerce regulations. Legal sports gambling in New Jersey would require a successful challenge to a federal law banning the spread of such wagering outside Nevada. Last year, casino executives estimated that $80 billion to $300 billion in sports wagering is conducted annually in America, with only 1 to 3 percent conducted legally. In New Jersey, legalization could mean an estimated $5 million to $8 million increase in the $350 million that the state's Pharmaceuticals for the Aged and Disabled program already sees annually from casino revenue.
Refer and Earn at Betfair
Betfair has rolled out a new program giving each customer the chance to earn over £8,000 for every new customer he brings to the site. The "Refer and Earn" scheme, open to all Betfair customers who have placed bets of more than £100, offers substantial rewards every time a customer introduces a new client to Betfair. For each new customer who also spends £100, the referring customer earns £20 (followed by additional quarterly bonuses for up to one year) as well as a commission on every customer the new customer brings in (and so on). Referred customers receive an initial £20 free bet and the opportunity to be a part of the bonus structure.
BoDog.com Offers to Host College Bowl Game
BoDog.com, the online casino/sports book/poker operation, offered $50 million earlier this month to stage the "BoDog Bowl," pitting the NCAA's two Division 1 undefeated football teams together to settle the National Championship. Both Auburn University and the University of Southern California finished the season undefeated, but USC was declared the National Champion, despite the two teams not getting to play each other. BoDog.com has offered $50 million for the two 12-0 teams to meet; all parties involved would get a share of the pie. Each of the two schools would receive a $15 million scholarship fund for their participation, with the eventual winner taking home a secondary $15 million scholarship fund. The final $5 million would be allocated to the NCAA Minority Opportunities and Interests Committee. Neither school nor the NCAA commented on the offer.
Covers.com Parent Company Acquires Wagerline.com
The publisher of Covers.com, the online odds and analysis provider, announced the acquisition of Wagerline.com earlier this month. SportsDirect Inc. will pay $1.2 million for the assets for Wagerline and will make SporsDirect the largest publisher of sports gaming information in North America. Wagerline.com was launched in 1995 and has grown into one of the most popular sports sites in North America, with millions of customer visits annually. Wagerline.com was founded in Denver and has developed a strong customer and advertiser base over the last 10 years. SportsDirect will continue to operate the site as a separate property but will move the management and operation of the site to its headquarters in Halifax. In the last two years SportsDirect has doubled its workforce to 80 employees and opened offices in Ireland and Nevada.
Punters Cash in on Shaw Delivery
When ex-Hear'Say's Suzanne Shaw delivered her baby nine days early last month a handful of punters on betting site AnyBets.com ended up winning their bets that Shaw would have her baby before the Christmas holiday. Shaw's due date was Christmas day, and 15 percent of the money wagered backed Shaw having the baby before the holiday. A company representative said that 55 percent of the Shaw action was on the baby coming on Christmas Day. AnyBets.com has found itself a niche by running pools on practically any topic imaginable and is becoming increasingly popular as a means of betting on the hot topics that aren't offered by traditional bookmakers.
Sportsbook.com Helps with Tsunami Relief
Online casino and sports book Sportsbook.com, announced plans last week to match users' donations in effort to raise awareness for relief efforts in the wake of the Asian tsunami.
Sportsbook.com has partnered with Northwest Medical Teams International, a non-profit humanitarian aid organization working to reduce suffering around the world and in the Pacific Northwest.
"We chose to partner with Northwest Medical because 98 percent of the donations received go directly to their humanitarian programs, and every $1 donated equals $85 in life-saving supplies," said Alex Czajkowski, marketing director for Sportsbook.com. "In addition, all of Northwest Medical supplies are donated by major U.S. medical and pharmaceutical companies."