Tuesday, 22 June 2010
Scammer takes UK Poker Forum for over £100,000
For those that don't know, Betfair is a "betting exchange" where users bet against each other with the website taking a small commission. Users can either back or lay any selection. The type of trading that Blatch requested investment for involved predicting a shift in the odds before the kick-off of live televised english football matches that had high volume of betting action. No "in running" bets would be made, a selection would be backed and then layed again before the match started. With large enough sums being used in the trade his backing of a selection would also be significant enough to move the line, giving him better odds when he later lays the same selection. This type of trading can be potentially profitable and is low risk compared to the size of the bets because by backing/laying the same selection you're working off relatively small margins.
I didn't invest in this, so everything you read here is my impartial interpretation of what happened based on what has been said in ridiculously long forum threads.
Since starting to trade with a small bankroll in August (Start of the English Premier League season), Blatch posted a huge streak of "wins" on matches where there had been a significant shift in the betting line pre-game. This success, along with the idea that making bigger bets would allow him to move the line more in his favour, brought in more investors for larger sums of money. The largest of the investors were his friends, who knew him through playing live events in the UK and through the online community. Until recently he had been posting that current bankroll was £80,000, with 3 very well known UK players having investments of around £10,000, and he was still accepting new investments right up until last week.
The fund was supposed to end with the English Premier League season but Blatch wanted to continue by trading World Cup matches. After some people asked for cashouts and he told them they'd have to wait a month or so some suspicions were raised. Then a new user on the forum, arbboy (Mark Wilson), made quite a few posts in the staking thread saying that things didn't add up. He posted a number of questions to Blatch, firstly stating that he had been following the thread and thought it was very strange that Blatch missed out on the most profitable trading opportunity of the world cup so far, the South Korea vs Greece match. After some weak responses by Blatch arbboy kept making posts that basically said that he smelled a rat. A huge majority of forum posters and moderators defended Blatch, their trusted friend, and accused the user arbboy of classless trolling. Arbboy was soon banned from the forum and his posts deleted.
But a few investors started to become uneasy when thinking about some of the points raised by arbboy and started pressing Blatch for answers. It wasn't long before it was revealed that all the funds in the account had been lost.
Blatch sent a PM to investors that included the following
Going back a few months everything was fine and going great. Everything I had posted was spot on and then one day I had made a trade on a midday kick off between Liverpool and Stoke and I simply didnt wake up in time. I must have not set my alarm right but basically I woke up with around 15 mins to go. At this point I could only rescue about 15% of the bank. I threw up at the time realising what had happened but for some stupid reason I decided that I could get the money back by the end of the season. Basically since then I have been trading the games still but without actually putting the amounts on. I was hoping that I would be able to raise the money by the end of the season and therefore the results would still be ok.
He said that he continued for many months to make trades "on paper" to keep up appearances, even though his account was near empty. He has since stated:
yes some of the losses werent infactual truth. It was to reduce the account balance and therefore I had to win less back. I know this whole thing is one serious mess up and I really want to turn this round and get people their money back.
Pages and pages of furious responses ensued from investors, including those who invested after the point that he claims to have lost most of the fund's money.
FACT. You lost the roll before I invested! Fucking ridiculous that you still had the balls to say more people could invest after you were sat there knowing you had “lost” people their cash (more than likely spunked it all on roulette on some dodgy site somewhere) Maybe saying to potential new investors that it wasn’t open to any more would have been a start?!?
FACT. You put bull shit results up on to keep people hooked! Where did you honestly think you were going to get £80k to pay people back to cover your lies?
FACT. You are a liar and a thief & the biggest grimmer ever...
Why did you still accept peoples money last week.Huh???
I know everyone can feck up but if this was 3 months ago
and you still pm'd me asking if I was wanting to be involved
I am quite angry, especially as it seems that me and brother seemed to have invested after this liverpool game where it had all gone wrong, and that taking the money was only making a situation worse, but I suppose would give you some funds to try and build the bank up.
Blatch continued to post on the forum and obtained a spreadsheet from Betfair detailing his betting history (over 10,000 transactions) which you can find here: http://rs899.rapidshare.com/files/400541349/BlondeBlatch.xls
Although there is no way to know if the spreadsheet was doctored before being passed on to investors the first observations from looking at the spreadsheet were that on this Stoke vs Liverpool match that he claimed to lose £50,000 he actually won £22,000 but that there was a whole load of betting on other stuff, including £5000 1.01 odds bets on cricket that he lost, multiple tennis bets up to £13,000 and a whole bunch of bets on everything from Darts to Motor Racing.
Betting at odds of 1.01 (wagering £100 to win £1) on some random guy to make 50 runs in the cricket seems absurd and is summed up by this post from Ismene.
I can also see two bets on the 21/01/2010 line number 3033 and 3034.... £5000 each time backing Raquibul Hasan in Bangladesh vs India first test @1.01. and the second time backing Niclas Fasth in Group B of the Abu Dhabi Champs.
Both bets in my opinion Blatch new had barely no chance of winning, and are low volume markets. It certainly looks to me like he has put up £5000 to lay at 1.01 on his own betfair account (knowing nobody would take that bet), and logged in on the trading account and backed it for £5k. Both times, within 6 hours of each other. Obviously both bets lost as they are more like 1000 than 1.01 and Blatch makes £10k just like that.
So it started to become clear from looking at the spreadsheet that Blatch's investments as he reported them in his thread were false and that he was actually using this Betfair account to fund his "balla lifestyle" and his sick gambling addiction. He even took his family to Florida recently on a 5-star vacation, posting pictures and facebook updates of him living the highlife.
People reading this must be wondering how he managed to go so long before people figured out he was scamming. Well, similar to Bernie Madoff's ponzi scheme, Blatch's fund was apparently making such huge returns that most people were keen to leave their money in the fund long term rather than cash out profits in the short term. The few people who did request cashouts could be repaid as he was still taking money from new investors who were impressed by the success that he was reporting to have. Being friends with many trusted members of the UK poker community (both live and online) who also had invested in him gave further confidence to investors that their money was safe.
Blatch also had a staking thread for the WSOP (now deleted) where people had staked him $10,000. It now seems he had no intentions of going to vegas and that money was all part of the same scam. In addition to this many people came forward to say they had other private deals with Blatch which they were stuck for too.
I was one of the people with £10k in this and from other dealings with Blatch I am in for around £20k total.
Since all this has come out, Neil Blatchly has confessed to a gambling addiction, claims to be completely busto and now living with his parents (he's in his mid 30's). He said that he plans to pay everyone back by getting a job and selling his crappy ford fiesta. Meanwhile, people aren't convinced. The dumping of funds to another account of his (the 1.01 odds cricket bets for example) lead people to believe that he may be hiding money away that he has scammed.
Lots of the investors (there were around 40 or so of them) have said that this was money they couldn't afford to lose, or that it was money they had earmarked for a trip to Vegas this summer, that they will now miss out on.
However, while a lot of backing and staking goes on in the poker community, and some people do extremely well out of it, it is never wise to invest more than you are prepared to and can afford to lose. Even the most trusted of people have turned out to be scammers, nothing is without risk in this game, bare it in mind.