Online handicapping contests...with an entry fee.

[thaskalos]

We have all participated in free handicapping contests here where the members have competed for cash and prizes which were donated by sponsors.

I am wondering what the legal implications are in staging an online handicapping contest where the members of a given site put up their own money as an entry fee in order to participate.

Could PA -- if he were so inclined -- run a handicapping contest on this site in which the site's most confident members would put up their own money to enter...and this money would be used as the cash prize for the contest?

What would stand in the way of such an endeavor...assuming that PA were to agree with it?

[JimG]

Hi thaskalos,

Not to derail your thread, but you can essentially do that at the Derby Wars site. Get a bunch together and play winner take all or pay down so many places. They do keep about a 10% vig for using their site and scoring the contest and ensuring picks are in on time etc. but you may want to look into it. I am not affiliated with the site whatsoever other than a player in some of their contests.

Jim

[thaskalos]

Hi thaskalos,

Not to derail your thread, but you can essentially do that at the Derby Wars site. Get a bunch together and play winner take all or pay down so many places. They do keep about a 10% vig for using their site and scoring the contest and ensuring picks are in on time etc. but you may want to look into it. I am not affiliated with the site whatsoever other than a player in some of their contests.

Jim
Thanks, Jim. I had never even heard of that site...since PaceAdvantage is the only horse racing site that I ever visit.

[pondman]

Legally?

Unless you have the licenses, I think it would lead to a raid by both the Feds and the State. Paying for a game in cash, and receiving cash as prizes is a touchy thing, with a headache of guidelines. Eventually a website doing this type of thing in the open, will be shutdown.

[raybo]

Here where I live, there are "free" poker tournaments, with cash prizes. All completely legal, as long as no entry fee is required and no money is spent on chips. Where does the prize money come from? It comes from the dealer tips (which is understood by everyone who participates).

Where there's a will there's a way, I suppose.

[PaceAdvantage]

I THINK that if all the entry fees are returned to the player (ie, the house holds nothing back), then it would be legal...but I'm not really all that interested in finding out either way...

[Robert Goren]

Is that what is happening now at the tracks with their entry fee contests?

[Greyfox]

A dangerous road to go down, loaded with hidden landmines, IMO.

[Dave Schwartz]

Legally?

Unless you have the licenses, I think it would lead to a raid by both the Feds and the State. Paying for a game in cash, and receiving cash as prizes is a touchy thing, with a headache of guidelines. Eventually a website doing this type of thing in the open, will be shutdown.

Several years ago I ventured into the Nevada Gaming Control office (which is just about 4 miles from my house). I asked them if I could run a site where I gave out prizes for handicapping tournaments. They said that providing there was no DIRECT relationship between the "bets" made and the money returned it was completely legal in Nevada.

I was completely surprised.

They also told me that setting up a "hedge fund" for betting on racing, sports, etc. was also completely legal and outside the purview of gaming control. Again, I was blown away that it was even legal.

[TJDave]

They also told me that setting up a "hedge fund" for betting on racing, sports, etc. was also completely legal and outside the purview of gaming control. Again, I was blown away that it was even legal.

What would be the advantage of five, or fifty guys pooling their money to bet?

Am I missing something?

[wiffleball whizz]

I THINK that if all the entry fees are returned to the player (ie, the house holds nothing back), then it would be legal...but I'm not really all that interested in finding out either way...

Generally speaking if you were to run a $100 tourney and only paid out $85 that's illegal.....but not taking a cut is perfectly fine....those are new jersey and Wyoming laws....much like poker I guess...

Like pa I'm not intersted in finding out and getting in a contest Witt these sharks around here

[TexasDolly]

What would be the advantage of five, or fifty guys pooling their money to bet?

Am I missing something?

Pooling money for p3,p6 ticket etc. Done all the time in LV.
Very popular at Sams Town for years and now at South Point.
TD

[ManU918]

Thaskalos... It sounds like a great idea and if you ever get this off the ground I'm in. I think the easiest way would be to start a thread with what races are in the contest and have the players make all of their selections in that thread (time stamp purposes) and do the money transactions off-site. I have been in several (non-horse) handicapping contests, march madness, college bowl, etc on other forms and usually the guy running the contest/pool collects the cash and distributes the winnings accordingly. Last year on one forum I won over 10K in a March Madness pool and was paid out the same night. Just need someone like yourself who is a trusted poster to handle the transactions.

[Hoofless_Wonder]

I THINK that if all the entry fees are returned to the player (ie, the house holds nothing back), then it would be legal...but I'm not really all that interested in finding out either way...

On a related note, what's up with the vCash levels here on the forum? It seems most of us have a balance of 400, but I haven't seen a race posted for wagering. Of course it would only be for bragging rights. Was there little or no interest in this in the earlier days of the forum?

[Dave Schwartz]

What would be the advantage of five, or fifty guys pooling their money to bet?

Am I missing something?

I did not make it clear. Sorry.

Someone creates a fund. People put their money in. The fund plays for 3 months, takes a substantial piece of the profit and distributes the remaining profit proportionately.

A former client got involved with such a group from Las Vegas. He and I flew down to Las Vegas to discuss it with them. They had a complete 4-color prospectus. Claimed that they had been doing what they had been doing for (then) 18 quarters and that in 17 of the quarters they had distributed a "dividend."

We met them at a beautiful home in Green Valley. They took us to lunch, but did not buy. (Should have been a tip. LOL)

They introduced us to the "expert handicappers." They had one for each major sport and some of the minor ones. (Baseball, football, basketball, hockey, but no parimutuel wagering. Turns out that was why they wanted me there.)

They said they would take an investment of $5,000 units. Minimum one unit, maximum two. You got the picks on a daily basis but after the wagers were made. You did not receive the amounts of the bets. You were not permitted any discussion on picks; no calls, nothing.

I smelled a Ponzi scheme when the top guy did not turn up on google searches as he should have. I recommended that my client not participate. Too late. He was already in for the entire two units.

Do I have to tell you that this didn't end well for the client?

After receiving two small dividends on his $10k investment, they called with a stock tip on an IPO. He put in some more money and never heard from them again.

After numerous calls, he flew down to Las Vegas and went to the house where we met them. Turns out it was a rental house.

They simply vanished. (What a surprise.)

Amazingly, none of this was illegal, according to the GCB. Well, unless one can prove fraud. (Emphasis on the word PROVE.)

[thaskalos]

They say that a fool and his money are soon parted.

The reality is that a fool and his money, were lucky to get together in the first place.

[RunForTheRoses]

On a related note, what's up with the vCash levels here on the forum? It seems most of us have a balance of 400, but I haven't seen a race posted for wagering. Of course it would only be for bragging rights. Was there little or no interest in this in the earlier days of the forum?

I vaguely remember several years ago there was a Toga/DM type contest where the vCash was used, I don't think I played til the end and did fairly poor with what I played. Anyone else remember?

[Hoofless_Wonder]

Dave - nice story - in the "sounds too good to be true..." category.

Personally, I've never understood the appeal of "cash" horse handicapping tournaments. In the days before the NHC, you'd see them out in Vegas all the time (and I'm sure some of them are still there), but unless additional purse money is coming in from somewhere else, why not just bet the races you like outside of the tournament? Penn National had quite the run with their big tourney, with of course the downside (IMHO) of having to bet on....Penn National.

When the NHC was set up, that presented a more appealing format - at least for me. You have the initial goal to qualify for the year-end event, with the lure of a very nice pick 6 hit being the pot of gold at the end of that rainbow. Those are some serious bragging rights, along with the Eclipse Award....

[Dave Schwartz]

They say that a fool and his money are soon parted.

The reality is that a fool and his money, were lucky to get together in the first place.

Thask,

That is perfect.

:ThmbUp: :lol: :lol:

[iceknight]

They say that a fool and his money are soon parted.

The reality is that a fool and his money, were lucky to get together in the first place. Should we view this quote in the context of your opening post :lol: :lol: :lol:

[PaceAdvantage]

On a related note, what's up with the vCash levels here on the forum? It seems most of us have a balance of 400, but I haven't seen a race posted for wagering. Of course it would only be for bragging rights. Was there little or no interest in this in the earlier days of the forum?Used to use the vCash system for the few big contests I ran...then Jay Trotter and his crew took the reigns and never looked back...they run such a tight ship and such an awesome show, there was no need to go back to the rather limited vCash way (you could only bet to win).