Betfred rigged games: a closer look at the regulations

Saturday, March 26, 2016

Betfred rigged games: a closer look at the regulations

December 10, 2013

This is a followup to my Betfred rigged games for which noone takes responsibility article.

As noted in the first article, Betfred had the following to say about the games in question:

1.Realistic Games provided the assets and rights to the Reel Deal game but SPIELO G2 developed the game for their operators and in doing so changed a number of core features.

2.On developing the game, SPEILO G2 developed two version: fixed odds and fixed price. The latter was in operation at Betfred. Fixed price meant that randomness could be introduced via a certified (GLI and TST approved) RNG and an RTP was introduced. In this case, at 96% RTP.

The acronyms GLI and TST relate to Gaming Laboratories International and Technical Systems Testing - the latter now redirects to the parent company, GLI. BetFred states that this company certified their RNGs, a testing lab certification which is required by the Gibraltar regulations but which, crucially, are not limited to just the RNG, but the overall game output:

11.1 RNG and Game Randomness

(1) Licence holders should be able to demonstrate the fairness and randomness of all games to the Gambling Commissioner without any undue delay.

(2) The output obtained through the use of the RNG in games shall be proven to:

(e) be random and distributed in accordance with the rules and expected probabilities of the game.

As such, while the RNG must be fair, the output, or what is basically the presentation of the game to the consumer, must also be "in accordance with the expected probabilities".

BetFred passes on th RNG test, according to their certifications from TST and GLI, but they fail on the distribution "in accordance with the rules and expected probabilities" aspect.

The GRA regulations go on:

12.2 RNG testing

(1) Prior to the commercial use of a new RNG in the provision of remote gambling facilities, a licence holder shall furnish the Commissioner with a certificate from an ATF confirming that the output of the RNG passes recognised statistical randomness tests confirming that it meets the randomness requirements in section 11.1(2).

As noted above, BetFred appears to pass this limited test. However:

12.3 Game engine testing

(1) Prior to the commercial use of a new game engine in the provision of remote gambling facilities, a licence holder shall furnish the Commissioner with a certificate from an ATF confirming that the game engine's output (after scaling and mapping) conforms to the randomness requirements in section 11.1(2).

This means that the actual game, as delivered to the consumer, must be certified to be fair by an ATF, or "Approved Testing Facility", ie. TST, GLI or any similar body.

Here is where BetFred fails - the output is not "in accordance with the rules and expected probabilities" noted in 11.1(2). There are therefore two possibilities:

1) BetFred does not have this cerification.

or

2) BetFred has such a certification, but it is false.

My suspicion is the former - I can't imagine that TST or GLI would certify a non-compliant product. In either event, BetFred fails this particular test.

The above regulation goes on:

(4) For the certification to remain valid there must be no changes to the mapping or scaling and/or game engine. Any changes to the game engine and mapping or scaling previously certified, needs to be re certified by an ATF before it is reintroduced in to the live environment.

Therefore, if the game engine was initially certified as compliant, but was then changed by BetFred or some other party, this would also contravene this regulation.

The regs go on:

12.4 Ongoing monitoring

(1) Further to ATF certification of the RNG and game engine prior to being used in the provision of remote gambling, periodic reviews of the game engine's output should also be undertaken as part of a licence holder's arrangements to ensure the ongoing fairness and integrity of its game engines.

This cannot have taken place. If it did, then it can only have failed. It follows then that BetFred, if they did test "to ensure the ongoing fairness and integrity of its game engines", they did not report the results to their regulator.

I also wonder if the GRA knew about BetFred's arrangement with Finsoft:

13 STANDARD 13 – APPROVAL OF JOINT VENTURES

13.4 Other joint ventures

Any contractual arrangement to share the licence holder's licensed facilities with a third party, such as those whereby a software supplier's games are installed and executed or accessed from the licence holder's gaming platform/infrastructure, amounts to a joint venture requiring authorisation by the Licensing Authority.

If BetFred did not tell the GRA about Finsoft / SpieloG2, this would be another regulation breach.

Of course, the most straightforward and categoric regulatory breaches can be found earlier in the standards document, and were noted in my previous article:

7.1 Game fairness

(5) A licence holder should not implement game designs or features that may reasonably be expected to mislead the customer about the likelihood of particular results occurring. This includes, but is not limited to the following:

(a) Where a game simulates a physical device the theoretical probabilities and visual representation of the device should correspond to the features and actions of the physical device (e.g. roulette wheel).

7.3. Compensated or adaptive games

(1) Games should not be "adaptive" or "compensated", that is, the probability of any particular outcome occurring should be the same every time the game is played, except as provided for in the (fair) rules of the game.

Here, BetFred fails on all counts.

Of all the above regulations, BetFred categorically passes only one, the certification of the RNG. It absolutely fails the game fairness, RNG and game randomness, game engine, certification of changes and ongoing monitoring regulations.

Of course, the failure here is not BetFred's alone. They broke the rules, but why is their regulator, the GRA, not actually monitoring them for compliance? This amounts to what at least one other licensing jurisdiction, the AGCC, calls "regulation by report", which in essence means "you tell us". This lackadaisical, hands off approach resulted in one of the biggest poker operator collapses in an industry already littered with casualties, when Full Tilt Poker and others had their domains seized and fraud indictments issued.

As such, this kind of approach clearly does not work, both intuitively and on the basis of evidence from both the FullTilt saga and, as of today, BetFred.

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Betfred rigged games: a closer look at the regulations

Betfred rigged games: a closer look at the regulations

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