FanDuel Sportsbook has come under fire for refusing to pay out an $82,610 winning ticket, claiming a computer glitch created the 750/1 odds it promised to pay.
However, a look at FanDuel’s terms and conditions, and the long-standing policies in other jurisdictions with legal sports betting, show why such disputes are often the difference between bad tech and what the rules say.
This particular dispute surrounds the Denver Broncos and Oakland Raiders game last Sunday. With a little over a minute left to play, Denver had the ball on its own 45-yard line, down by two.
Newark’s Anthony Prince then placed a $110 in-game wager on Denver to win at the FanDuel Sportsbook at Meadowlands Racetrack at 750/1. And no, that’s not a typo.
Broncos win and controversy ensues
The Broncos went on to kick a 36-yard field goal with six seconds left to win it. However, when Prince tried to collect the $82,610 his ticket promised to pay, he immediately met with resistance from FanDuel Sportsbook staff.
Prince told News12 New Jersey a FanDuel employee said the system had a glitch that created the outrageously long odds, and it is not obligated to pay for such glitches.
Prince said he was offered $500 and tickets to a series of New York Giants games as an apology. However, he refused to accept it.
In the days since, a number of other New Jersey gamblers have come forward saying they took advantage of the same glitch on the FanDuel Sportsbook app. They found out the next morning FanDuel took the money back.
FanDuel released the following statement in the aftermath:
“A small number of bets were made at the erroneous price over an 18 second period. We honored all such bets on the Broncos to win the game at the accurate market price in accordance with our house rules and industry practice, which specifically address such obvious pricing errors. We have reached out to all impacted customers and apologized for the error.”
The following further explanation was given in regards to how the glitch took place:
“At that moment in the game, our system updated the odds and erroneously posted a price of +75,000 on the Broncos to win the game (bet $100 to win $75,000) when the correct odds for the Broncos to win the game at that point in time were -600 (i.e., bet $600 to win $100). A small number of bets were made at the erroneous price over an 18 second period.”
FanDuel house rules…
Clearly, FanDuel decided to stick by its house rules, which state:
“In the case of any blatant errors in prices transmitted (including for example where the price being displayed is materially different from those available in the general market and/or the price is clearly incorrect, depending on all of the circumstances), bets will be settled at the correct price at the time of acceptance.”
Under these published rules, a requirement in the NJ sports betting market, it appears FanDuel is off the hook.
However, the organization is taking a bit of a public relations hit. Critics argue there’s no point in having legal and regulated sports betting unless regulators are there to force sportsbooks to honor the bets they book.
… and NJ sports betting regulations
New Jersey regulators are not ignoring the situation.
David Rebuck, director of the New Jersey Division of Gaming Enforcement, told the Associated Press the agency is investigating the matter.
He also said it is just as important to look at how the error occurred, given internal controls to prevent it. Those findings may land FanDuel with some kind of fine.
NJ regulations also state the following:
“A wagering operator shall not unilaterally rescind any wager pursuant to this chapter without the prior approval of the Division.”
As it is, on Thursday, FanDuel moved to honor the disputed bet and pay out the $82,000 in winnings to Prince. Other bets that were placed with the error will also be honored.
Some might think this is a byproduct of the New Jersey sports betting market’s youth and the inexperience of its operators. However, it’s far from the first error made by a sportsbook. Nor is it the first time gaming regulators have dealt with such an issue.
The entire reason a sportsbook like FanDuel has a house policy to deal with such an error is the distinct possibility it can and will happen.
Similar policies in the UK
In September 2014, a UK soccer fan placing bets on a Betfair (now FanDuel) sports betting app ran into a similar problem.
She wrote to an advice columnist with The Guardian newspaper claiming she found an odds glitch. Bets on a team ahead by a few goals with just a few minutes left in the game were at 12/1. She bet £50, won an additional £600, and suspecting Betfair had made a mistake, withdrew the cash right away.
A few days later, her Betfair account showed a negative balance of -£593. Customer support told her the wrong odds had been given, and she would need to pay back the winnings.
The Guardian advice columnist told her Betfair has every right to reclaim the money. She said its terms and conditions protect it. They do this by clearly stating a player who wins as a result of human error or software glitch must repay the money.
The columnist went on to say if Betfair pursued the money through the courts, it has a pretty strong case.
Of course, the columnist suggested the gambler can contact UK gaming regulators if she wants to put up a fight. It’s just a fight she isn’t likely to win.
The terms and conditions of all UK sportsbooks state if a genuine error occurs, the sportsbook can cancel a bet. Sportsbooks and regulators call it a palpable error, or palp. It’s the same for human or computer errors.
Players should get the bet back. Or, as they did at FanDuel Sportsbook, have the bet settled at the correct odds.
An obvious error in sportsbook odds
The one caveat in the UK is that the error must be obvious. If the price of the bet is -600 everywhere except one sportsbook where it’s +75,000, it’s an obvious error.
Again, players can always take a dispute to the gaming board. In the UK, that means the Independent Betting Adjudication Service. In New Jersey, it’s the DGE.
What happens in Nevada?
Nevada counts the time it has had legal sports betting in decades, not months. Over there, it’s the Nevada Gaming Control Board that settles similar disputes between a bettor and the sportsbook.
All Nevada sportsbooks have similar house policies, but there are rules that provide bettors with additional avenues for resolution. For instance, operators must report any dispute exceeding $500 to the NGCB. The dispute is settled sometimes in favor of the bettor and other times in favor of the sportsbook.
Respect to @notthefakeSVP. In Gaming, it can’t be a subjective decision. The Vegas rule “tickets go as written” is a staple. We’ve paid out mistakes and guests have received the “wrong” tickets. Once they leave the window (or confirmed on mobile), it’s action. Long conversation https://t.co/uSc4Ipvon1
— Jay Kornegay (@JayKornegay) September 19, 2018
If a sportsbook has a published policy, regulators in Nevada are going to go by the letter of the law. That means ruling in favor of standing behind it. But, in most cases, the book just takes the hit because “tickets go as written.”
In the case of FanDuel, its house rules were approved by the DGE. It is likely the bigger issue for the sportsbook and regulators is why and how such a glitch occurred in the first place.
Losing customers, saving face
An operation like FanDuel may lose a few customers over this. There will be those who accuse it of changing lines to suit its needs and refusing to honor winning tickets.
Still, more will claim it is adjusting things after the fact and turning itself into a moving target.
However, most will see this as an obvious error. They will accept that FanDuel has a published policy in place to handle such things. And in the end, FanDuel reversed course.
In the larger sense, bettors will see that the legal and regulated sports betting system works when the DGE does what every other regulator would do: investigate, read the fine print, and follow the rules.