Betting syndicates have been taking place for pretty much as long as betting has been a thing. People engage in them as they can potentially be much more thrilling than just placing a bet by yourself.
But what exactly are they? And are they considered to be a legal activity? Plus, have any instances occurred where syndicates have not been considered legal operations?
Here, we are going to be looking at whether betting syndicates are allowed or not. We will delve into how they operate and what circumstances relate to legal syndicate betting and vice versa.
Naturally, it also depends upon the scale of the syndicate betting taking place. After all, in legal terms, one person cannot bet for someone else, which would generally speaking affect such syndicates. How are syndicates possible to do with certain restrictions in place?
What Are Betting Syndicates?
To put it simply, syndicates exist as a type of pool betting that involves two or more players combining their stakes on a certain events. This gives them a chance to win bigger prizes in general, which is then shared with the other participants in the syndicate.
At one point, syndicates were primarily utilised on horse racing events. However, you are also able to find them being put to use on football, tennis, basketball and various other sports. Essentially, several bettors pool their bets together and then a single person lays the bets for everyone at once.
In sports syndicates are often run by groups of people who bet in turn each week and then pool their winnings after a period of time, either sharing these out or using them for a special occasion, such as a group trip to a race meeting like Royal Ascot.
You will find that lottery syndicates are exceptionally popular in today’s gambling world. Groups of individuals gather together and play the lottery alongside one another. They all select different numbers, as is the norm for playing the lottery, and then winning lines pay-out in the normal way. However, the funds are gathered together in one pot, and will then be shared out after 6 months or one year, for example. This is sometimes done between office colleagues or groups of friends, and has often been done so as to save up money to be distributed between participants at Christmas or New Year, for example.
Lottery syndicates are often promoted by the UK’s National Lottery. This is displayed on the official website and provides details on how to proceed with such. In this circumstance, the ability to participate in a syndicate is a legal option. Directions on how to proceed with placing the bets and how the payments from participants will be made etc are also explained by The National Lottery.
Sportsbooks aren’t specifically known for welcoming syndicates on the whole though. Most clearly state in their terms that you can bot place bets for other people or using someone else’s money and this on the face of it means syndicate betting is against their rules. In theory, if caught, they could close an account and refuse to pay out. Therefore, many people who operate syndicates use bespoke services to do so.
For example, the Mr Green platform has its own section dedicated to this. Going by the name of Colossus, this works as the site’s pool betting product. These jackpot rewards are offered across a range of sports, but you don’t select the people you’re betting with. Instead, it works as a sort of crowd betting solution, allowing you to contribute to a pot alongside hundreds of other bettors. Colossus handles all the setup of this, as well as the funding and pay-outs associated with it. The only thing players need to do is place their syndicate bets. Again, this operates as a legal option through a licensed online sportsbook.
The Legal Stance on Betting for Other People
Legally speaking, you’re not able to place bets on behalf of other people. Therefore, how does this sort of rule relate to syndicates. After all, one person must place the bets on behalf of everyone participating in the syndicate. Yet, syndicates may or may not be legal, depending upon the actual nature of the scheme.
Obviously, the person placing the bets for the syndicate could be considered as the one making wagers for everyone else. The legal fine point about this though, depends upon whether the person collecting those individual stakes and placing the bets is doing so with or without profit. If they’re obtaining profit from it, then it is considered an illegal activity.
All proceeds given to the syndicate must be handed out to participants, and this must be for small stakes syndicates, too. Only the person who offers to and proceeds with placing the bets is capable of claiming any winnings. It is then up to that person to distribute these as discussed prior to the syndicate beginning.
The Triplebet Situation
In April of 2020, the Triplebet online gambling site was handed out a fine by the United Kingdom Gambling Commission. While there were various reasons behind this occurring, one of the issues was relating to syndicate betting.
According to the Gambling Commission, one of Triplebet’s main customers was a syndicate. However, the lead contributor to this syndicate was a professional gambler, who also had a beneficial interest in Triplebet. It was found that over an 18-month timeframe, starting in November 2016, the syndicate matched bets on the Exchange of Triplebet. This totalled in excess of $55 million, and there was no risk assessment put in place by the gambling site.
While Triplebet submitted a response stating that its actual customer was the lead contributor of the syndicate, and that this didn’t require any obligation for them to ascertain the identities of other contributors, the Commission took a hard line. The consequence of this activity was that gamblers were permitted to gamble large sums on Triplebet without due diligence. Therefore, the Commission found itself justified in its actions against the site. By the end of this, Triplebet had its licence suspended and a £740,000 fine handed out as well.
The Stakes Matter
In terms of forming a syndicate, bookmakers probably don’t care if you participate in one, so long as the stakes are quite low for this. Generally speaking, if everyone within the syndicate agrees to place the minimum wager, let’s say £5 for example, then it wouldn’t really make much difference to the sportsbook on the whole.
On the other hand, if the syndicate featured people wagering £200 on markets each time, this poses a bit more of a problem. The winnings from such a syndicate bet have the potential to be a lot more, and sportsbooks don’t want to pay out large sums of money. So, the relevance/acceptance of a syndicate does depend on the stakes being placed.
Yet, there are certain circumstances where syndicates must not take place. Take, for example, a land-based pub. In general, it’s not considered legal for an establishment to garner a licence to sell alcohol just to facilitate betting events. However, if such events do occur, then publicans must ensure that players do not exchange betting slips between one another. This is because it is considered a lot more illegal for betting on behalf of someone else to take place than it is for a pub to host betting.
When Syndicates Go Wrong
Syndicates don’t always go the right way, and there have been certain instances of people making off with all the money and not paying out to other participants. This is, of course, the risk that you take when joining a syndicate in the first place. Unless you’re the bettor, then you need to be able to trust the leader of the syndicate completely. Unfortunately, there was an instance where a lottery syndicate experienced a mysterious disappearance of their leader.
Gary Baron, 50, an Australian truck driver, entered into a lottery syndicate with 14 of his colleagues and lotto syndicate members. Baron took the position of syndicate leader, taking $20 from each of the players to purchase lottery tickets for the Powerball draw on behalf of the whole group. The understanding was, as with any syndicate, that any winnings would be split between the members. Yet, when the draw saw the syndicate win in 2014, Baron pocketed the cash for himself.
The lottery win had netted the syndicate A$16 million (around £9.4 million), and the vast majority of that should have been divided between the other players. While Baron would have scooped a share of it himself too, greed got the ultimate better of him and he stole the full amount. The members of the syndicate suspected that the winning ticket had been brough through a workplace lotto, although Baron made the claim that he had bought the ticket for himself separately.
After picking up the winnings, Baron proceeded to quit his job, purchase a luxury home for himself and a property for another family member. Not only that, but he bought a $200,000 convertible BMW M4 alongside. When questioned by members of the syndicate over whether the Powerball had been won via their group efforts, Baron laughed it off and made the statement that the ticket was bought separately.
However, the 14 colleagues only managed to learn of the win when one of his other work colleagues delivered a celebratory bottle of champagne from Tatslotto. The other members of the syndicate took Baron to court, requesting a pay-out of A$1 million from him as a result.
DVLA Syndicate Turns Out Bad
In the UK, a group of 16 workers at the DVLA offices in Swansea opted to enter into a lottery syndicate together, too. The team went on to win big through the syndicate, although the celebrations regarding this didn’t last for long.
Not too long after the win was registered, members of the syndicate began squabbling over three participants. It was claimed that the three had not paid money for their tickets on that week’s win, which equated to £1 million on the EuroMillions. Each syndicate player was due to pick up £62,500 from the win, but if the three who didn’t contribute to the pot that week were removed, the remaining members would get an extra £14,423 each.
“It’s all a bit awkward and there’s a bad atmosphere”, said one of the DVLA workers. “It’s terrible how people can turn so nasty when a bit of money is involved”, they finished.
Operator Camelot also tried to get involved in the syndicate row, with attempts to mediate the outcome and division of money. Bosses at the DVLA office have also intervened with their own input. In the end, a vote was brought forth to see whether the three who did not contribute to their ticket payment that week would be given their share of the winnings or not. This is due to the fact that a syndicate contract was not drawn up beforehand.
The National Lottery always recommends that players draw up specific paperwork in the event of such a dispute coming to the surface after a win. Templates are even provided via the lottery website for this. The syndicate at DVLA had chosen to remain anonymous though, so the final result of the vote was not something that was made public knowledge.
Nepotism Takes Over
Could you deal with being kicked out of a syndicate and replaced by the son of the boss? I certainly couldn’t. Yet, this is something that happened to Brendon King. The Australian factory worker was part of a 14-member syndicate, and this group went on to win A$40 million (£23.6 million, roughly). However, King was no doubt stunned to find himself removed from the group and replaced by the boss’s son – someone who didn’t even work at the company.
Brendon finished work at his office on April 29, 2016 and his colleague Robert Adams clocked on to his shift 30 minutes later. It was on that afternoon that Adams, who ran the lottery syndicates at the factory, decided to pool funds to enter into the May 5 Powerball draw. Mr King held a ticket in the same draw as part of an earlier syndicate, but Mr Adams decided to form a second one with 13 others as a one-off. This, he said, was to boost their chances of becoming millionaires through the game.
Unfortunately, despite King being a regular contributor to the lottery pools at the factory, Adams did not consider including him in it as they never crossed paths on the plant floor that day. It was at this time that Adams chose to include his son in the syndicate instead, and it was this second syndicate that won the members A$40,445,165.
Mr King wasn’t happy about this and chose to sue Adams in the New South Wales Supreme Court. He argued that he was entitled to around A$2.7 million of the winnings. His argument suggested that his understanding was that he had paid to be a part of the syndicate organised by Adams alongside all others. Unfortunately, Justice John Sackar ruled that there were clearly two different syndicates, and no funds were mingled between them. Therefore, King did not receive any sort of pay-out from the huge win, while his other colleagues did.