Clearly Erroneous Bets Policy
1. Erroneous bets
Smarkets may consider bets to be clearly erroneous in cases of obvious and significant input error, whether with stake, price or identification of a contract, and where best price execution cannot account for the error and bring the bet within the defined boundaries of the ‘fair price’ as described below. Please note that the price differences noted below are in absolute difference in percentage price unless stated otherwise. For example a bet matched at odds of 50% (2.0 in decimal format) is considered 10% different to the price of 40% (2.5 in decimal odds).
In cases where best price execution can only account for a part of a bet, we would still consider any other portion of the bet to be clearly erroneous if it falls under the definitions below.
This policy is designed to protect customers, however, where one or more counter party to the erroneous bet trades out of their position, we may not be able to recover the full amount and the customer who placed the erroneous bet will remain liable for the difference. The customer placing the bet will be defined as the one placing the order in the first instance.
2. Filing a complaint
In order to raise an erroneous bet complaint, a written request for the bet to be investigated must be received by Smarkets via email to firstname.lastname@example.org within 60 minutes of the bet being matched and, in the absence of exceptional circumstances, this must be received before the result has been decided.
For this purpose, exceptional circumstances shall include but not be limited to, bets that are matched just moments before a market is decided and where contacting us before this would be impractical. The request must include the following information:
- The time the bet was matched
- The contract and market the bet was placed on
- Price the bet was matched at
- Reason for believing the bet to be erroneous
Please note that it is still the responsibility of users to manage their own bets in-play in unmanaged markets.
3. Outlier transactions
In the case of outlier transactions Smarkets may, at its sole and absolute discretion and on a case by case basis, carry out investigations into trades beyond the 60 minute reporting window or after events have been settled.
Outlier transactions are defined as bets matched at a price that exceeds +-20% of the determined fair market price at the time the bet was matched.
4. Defining fair market price
When a complaint is filed, Smarkets will use any available resources, including but not limited to, recent trades on the Smarkets exchange and prices available elsewhere at the time, to determine the fair market price at the time the bet was matched. If the erroneous bet was matched at a price of +-15% of the fair market price at the time, Smarkets reserves the right to void the bet.
In addition to recent execution prices and prices available on other platforms at the time the bet was matched, Smarkets may also consider a number of additional factors when deciding whether a bet is clearly erroneous.
These include, but are not limited to, system malfunction, the volatility of the contract, new information becoming available in the public domain that may significantly alter the price (such as team news for a football match), whether the result of the bet had been unconditionally decided before a complaint was raised, whether betting on the market was recently halted and resumed, the start price of the selection and if the complainant had taken any steps to limit their exposure to the erroneous bet.
For example if the price of a contract is particularly volatile at the time a bet was matched, due to new information becoming public or otherwise, it is less likely bets will be voided under this policy as the fair price would be more difficult to determine objectively.
In cases where Smarkets cannot provide a reasonable determination of the fair price of the contract, no bets will be voided.
5. Reviewing bets on Smarkets’ own motion
Smarkets may also conduct reviews of bets on their own initiative. In normal office hours, and excluding the case of outlier transactions, users will be alerted to the investigation and informed of a decision within 120 minutes of the bets being matched.
Where the erroneous bet occurs outside normal office hours, a decision will be conveyed by 18:00 GMT on the next business day, defined as Monday to Friday and excluding national holidays in the UK.
Users that wish to contest the decision to void their bets under this policy may follow the standard Smarkets complaint and dispute resolution process.
Last modified: June 8, 2018