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BetFred rigged games: my comments on the regulator's response

Saturday, March 26, 2016

BetFred rigged games: my comments on the regulator's response

December 10, 2013

Here are my comments on both the Gibraltar Gambling Commissioner's response to allegations regarding Hilo and ReelDeal games, and his followup response

First a couple of general notes:

• The GGC is not the villain of the peace here. The commissioners have shown themselves to be as incompetent, toothless and compromised as the Malta LGA and the Alderney Gambling Control Commission, those two other ostensibly regulatory bodies found so wanting in recent times. They appear hopelessly fettered by their ties to their client casinos and incapable of impartially judging a situation, the unlovely reason for which surely being that their operators, specifically BetFred in this case, pay them to reside on their territory. They do not want to damage BetFred, because so doing would damage their own bottom line. However, the GGC did not develop or promote software which was, to all intents and purposes, rigged. This was the preserve of the software supplier, GTech, and the operators who ran the software, most notably casino and sportsbook BetFred.

The GGC have certainly positioned themselves as complicit in the matter, but they are bit players in the overall scheme. Perspective needs to be maintained in regard to who is really at fault in this matter.

• This does not appear to be an official GGC statement. It cannot be found anywhere on the GGC site. Additionally, the title addresses the very specific audience of the forum discussion thread in which the matter first came to light, and the content of the response in part also addresses that particular audience. When a regulator has issued a response in these circumstances in the past, it has invariably addressed the exclusivity of the issue to the interested readership at large. This format is very unusual, not to say odd.

However, this received some clarification in the follow up response, where he states:

First, the response was provided to Casinomeister as a response to the earlier thread. It is not a press statement, it is not a formal ruling, it is commentary 'in kind' to Casinomeister users.

This was widely held to be an official GGC response, and given the gravity of the charge it would be hard to expect anything less. As it turns out, the GGC does not appear to have considered this worthy of an official commission investigation, but rather a rather casual response directed at a relatively small internet readership. This is quite extraordinary.

Now to address specific points in the responses:

• The commissioner has highlighted the fact that the player was a multi-accounter, and made quite an issue of it. Here's a flavour of his comments:

it was apparent to us from the moment the ‘katie91’ thread was initiated that the author was involved in some form of fraudulent activity. The posting simply did not ring true and should have set off the alarm bells of any experienced reader or regulator. Again, that does not preclude the author from making accurate or useful observations, but what it does do is render his credibility and the credibility of his evidence as close to useless, especially in the context of regulatory action. Anything such a witness says has to be taken with a huge degree of scepticism.

It's been said by me and others that the issue is the software, not the player. The player's character and behaviour, however reprehensible, have no bearing on the matter. Phil Brear actually does state this himself above -

Again, that does not preclude the author from making accurate or useful observations...

This is correct. The observations were both accurate and useful, and that is really an end to the matter. However, Mr. Brear immediately contradicts himself with the comment immediately following:

...but what it does do is render his credibility and the credibility of his evidence as close to useless.

The observations cannot be both "accurate or useful" and also "close to useless", because the one directly contradicts the other - "useless" is the opposite of "useful". The fact remains that the player's observations were accurate, and when borne out with expert analysis were very useful. His character and behaviour are not relevant, and should be disregarded as having anything to do with the software issue. This apparently crux issue for Phil Brear is simply a misdirection of the core matter.

• The following point is the true crux of the matter - Phil Brear addresses the issue of the game, and he explains the performance clearly, an explanation that mirrors my own assumptions about how the game worked in my original article:

The original HiLo game used an RTP/maths methodology known as ‘Fixed Price’ but with different RTP and RNG’s for PFF (100%) and PFR(96%); in very simple terms, the PFR game logic amounted to each customer choice producing an RNG number between 1 and 10,000, with numbers below 4800 winning and numbers above, losing, creating 96% RTP entirely randomly and a house win of 4%; the PFF gave a 50:50 chance. The RNG’s themselves were different for PFF (Flash) and PFR (Server integrated) as the games did not need to be identical.

In essence, 48 numbers out of 100 (or 4800 out of 10,000) were mapped to black, and 48 to red. The exact mechanism for the remaining 4 numbers still appears to be missing; clearly something triggered an outcome unfavourable to the player, but we still don't know what this was. Anyway, we do now have confirmation as to why an apparent 100% game had only a 96% return.

He goes on to clarify that a subsequent version of the game had naturally weighted outcomes of 50:50, but with reduced payoffs listed in the paytable:

In 2006 a second version of the game mechanic was produced but using a different game logic known as ‘Fixed Odds’. In this case the game logic for both versions was 50:50 on the player’s choice, but the payout for winners was less than evens, again producing an overall house win of 4%. As the payout was less than evens both PFF and PFR versions had RTP’s of 96% and the versions also used different RNG’s.

This is fair enough. If it's clearly explained that my £5 bet will only win £4.80, I can't complain.

I have an issue with the following comment:

These games, in all versions, have been subject to independent testing and do behave entirely randomly, they are not ‘adaptive’ or illegal in any way. Thet do not ‘misrepresent’ the players’ chances. The error was in the production and presentation of a discrepancy in the paytables.

They may be random in the sense that they use a good RNG, but it has not yet been demonstrated that they are not "adaptive" - it is still not clear how the software ensured that, with 48% probability of one outcome and 48% for the other, the remaining 4% would go against the player. This remains the heart of the issue.

Mr. Brear then lists what appears to be a catalogue of errors that resulted in a 96% return game being listed as 100%:

In the first instance, a decision was made to put all the game versions on the same server based RNG rather than using the Flash version for PFF. The RNG change was done successfully. However, when it was done, the PFF on the Fixed Price version still operated at 100% RTP game logic, as it had been assumed at the time of this change that all the games used the same game logic (96%). Whilst this error made no difference to the random performance of the games, it meant the Fixed Price versions continued with different RTP’s.

Subsequently, the content of the games’ paytables were upgraded from static to dynamic. This was when a second error occurred. Both Fixed Price Help Files were linked to the PFF outcomes (100%) and so the Fixed Price Help File indicated that both versions had an RTP of 100%, when PFF was still 100% and PFR was 96%. This meant that, as was alleged by Katie91, a player could form the belief that the PFR game had an RTP of 100%.

So: both Play For Fun and Play For Real versions were assumed to have a 96% player return, when in fact the fun version still operated at 100%. When a subsequent game upgrade took place, the help file for the 100% game was linked to the 96% game. This was the explanation already provided by BetFred, with a bit more detail added here.

At this point, we're no further down the road than previously. Aside from some additional detail, we know now exactly what we knew before, then from the casino, now from the regulator.

There follow these rather cryptic comments:

in our view katie91, who we have spoken to and has admitted his actions, used false details to ‘multi-account’, and was using a bot, indeed, he writes and sells bots, so he was knowingly and deliberately in breach of the operator’s T&C’s on at least two significant matters, in an effort to obtain money in a way he knew he was not entitled to. If katie91 had used his real identity he would have run the risk of being declined or discovered; if he had asked ‘can I use a bot’ he would have been declined; so the katie91 account should never have existed, the game play should never have taken place.

This is all true, but what is the point in stating it? The implication appears to be that since an illegal account shouldn't have existed, the game play conducted on it should somehow be taken as non-existent. This is irrational. If the game play did not exist, noone would be talking about it. But it clearly did exist, and we are talking about it.

Is Mr. Brear trying to make a preemptive case for "evidence inadmissible in a court of law"? To seek to invalidate evidence on such a technicality would be a gross betrayal of the players the regulator purports to represent. I hope this is not the case, but I can see no other purpose for these statements.

Mr. Brear also comments generally on the game in his follow up comments. These statements demonstrate a substantial level of ignorance about how gambling games and gambling software work.

The game is derived from a long established slot game, it does not represent a card game. The game 'rule' people refer to applies to representations of dice games, card games, roulette etc.

If it graphically represents playing cards, which it does, it represents a real game. This is not rationally disputable.

The game cannot be a representation of a pack of cards, how could it pay 12x etc. if all cards had an equal chance of being picked?

Payouts are set and displayed in the paytable. In many games these are graphically displayed on the playing interface. In video poker, payouts can range from one for one for the lowest paying hands, up to several thousand for one for the best progressive jackpots. The payouts reflect the probability of the hands. The chance of drawing a high pair in most video poker games is about one in five, hence the low payout for the win. The chances of a royal flush are around one in forty thousand, hence the high payout.

Equally, if only a limited number of cards within the ranks result in a win, as in a simple high/low game, the payouts will be adjusted accordingly; if you hold the 3 and bet on a "lower" card, since there is only one such, the 2, this bet will be the highest paid. Betting "higher", you would receive the lowest payout, as all but two cards result in a win or a tie.

Brear is quite right, all cards have equal probability in a random game. But all winning cards / card combinations do not, and hence the payouts have to be adjusted accordingly. To question how graded payouts can be set when "all cards have equal probability" is to completely misunderstand just about everything it's possible to misunderstand.

• There is one matter very conspicuous by its absence: the Gibraltar regulations. I looked as closely at these as a non-expert can for my A closer look at the regulations article. I don't intend to repeat myself too much here, but several regulations do seem to stand out as having been violated:

11.1 RNG and Game Randomness

(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.

It may have been random, but it was not "distributed in accordance with the rules and expected probabilities of the game", because the expected probability was 100%, not 96%.

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.

The game was misleading, without shadow of doubt. The return was 96%. The stated return was 100%. This is misleading.

The game clearly simulates a physical device: playing cards. The actual probabilities did not correspond to the theoretical probabilities. The visual representation did, but not the probabilities.

We still do not know the mechanism by which the game ensured that for 4% of the time the player's bet would lose. This appears to be an "adaptive" mechanism.

I remain convinced that BetFred is in breach of its regulations, and the GGC has failed to enforce them. If regulations are not enforced, why bother to have them at all?

• The report contains a large amount of hyperbole, typos and spelling mistakes which it might be seemly to turn a blind eye to, but they do go to the professionalism of the operation, and since this aspect is now rather in the spotlight I think these matters bear highlighting:

Mr. Brear uses the expressions "kangaroo court" and "hysterical witch-hunt" to describe the largely fair and comprehensive online discussion. Online gamblers are not lawyers, and a degree of excitement is to be expected, particularly given the gravity of the charges. The use of these expressions is petulant and unprofessional. He also makes these almost threatening comments:

This is aggravated by us knowing who some of the contributors are, the irregular practices some of them engage in themselves, and the agendas that some of them are pushing.

Many of them reading this will know that they too have ‘dirty hands’ in terms of their own account activities, or were pursuing private agendas rather than properly assessing the merits of the complaint.

Followed by this descent almost into farce:

Some of you might not like the stand we take against fraud, deceit and multiple identities etc. katie91 pretended to be his sister, well at least one of you is pretends to be your mother!

Whose mother does someone pretend to be? What are these agendas? What irregular practices? This is unsubstantiated nonsense. Even if the GGC actually had evidence that someone was posing as his or her own mother, aside from being utterly irrelevant to the matter in hand and demonstrably a smokescreen to attempt to divert attention, you cannot make such accusations with no evidence presented without looking completely foolish.

With some of these latter comments I begin to wonder if this statement was truly intended as a serious response to the situation.

In summary:

The Gibraltar Commission has not found the operator in breach of their statutory terms and conditions of use, although they plainly do appear to be so.

Although they acknowledge at least "mistakes" on BetFred's part, they propose no sanctions of any kind, claiming "mistakes do happen, bugs do occur".

The party they do accuse is the player who originally brought the matter to public attention, claiming that his evidence is both "useful" and "useless" in the same sentence.

They do not consider that any refunds are in order, irrespective of the fact that fully four percent of the total wagered amount on the games in question should be rightfully refunded to the players who played the game under the deceptive conditions.

This is a poorly written report which misses the point, focuses on irrelevancies, leaves issues unaddressed and demonstrates substantial ignorance of the exact subject matter of their remit. The Commission considers this "an end to the matter"; for the sake of their own credibility I hope it isn't.

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