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Account closures and limit cuts at U.S. facing sportsbooks is nothing new




Recent tales of players being banned by sportsbooks in Las Vegas are nothing new and probably have nothing to do with sports bettors 'winning too much'.

Media outlets have recently run stories of how Las Vegas sportsbooks, and in particular William Hill, are cutting off winners. According to the article several winning William Hill players have been told by the company that they are no longer allowed to play there and the only reason those bettors believe they have been shown the door is because they were consistently winning. William Hill denies the allegations and claims that they would only cut people off if they have multiple accounts or were doing something untoward. A William Hill spokesperson effectively told David Purdum, an ESPN reporter. that they are bound to follow rules to prevent money laundering, but they would never outright ban someone for winning:

William Hill"It is completely false to say that we ban people simply for winning," William Hill U.S. told ESPN in a statement. "There are literally tens of thousands of customers in Nevada that are winners at William Hill. That's one of the great things about sports betting -- a lot of customers do win.

"In the rare situation where we do prohibit someone from wagering with us, there are
a variety of reasons why. They include the sharing of accounts (usually tied to someone who previously has been banned), betting on behalf of third parties, screen scraping and other efforts to 'game' the system, as well as compliance reasons or being offensive to staff and/or other customers.

"If someone tells you that the reason that they are prohibited from wagering with William Hill is because they are winning, they are not telling you the whole story."

But people in Europe will tell you that being cut off or having limits cut drastically is just a way of life and it occurs for many reasons, and mostly because they view you as an unprofitable account. I recall one bettor at Bet365 almost a decade ago telling me that after consistently winning on golf matchups his limits were cut to next to nothing. In fact, he showed me the screenshot of his account which indicated his maximum bet was $4 to win $3 on a matchup. The sports he lost on had normal limits, but on golf his limits were cut to an amount that wouldn’t have any effect on the book’s profitability. This became so commonplace that some bettors at the time used to laugh and call the company Bet $3.65. Since that time Bet365 has grown exponentially and is now the biggest bookmaker in the world with some of the best limits going and are often used as the line setter. I have heard of very few bettors recently that have been either banned or had their limits drastically cut, although I’m sure it still happens. That said, in Europe there are far more options for sharp players who have been banned or limits drastically cut than there is in the United States. p2p sites like Betfair or Betdaq will happily accept all their action since there is no risk to companies in a betting exchange and there are a few sportsbooks in Europe that actually advertise that they welcome winners since they believe their bookmaking abilities are still superior. And, if Betfair does eventually set up a U.S. exchange site as is being rumored, then sharp bettors will have that option stateside as well.

Banning 'Winners' Isn't New

Nevertheless, the notion that banning winners in the U.S. is a new phenomenon is perplexing. Since sportsbooks existed in Las Vegas, very sharp bettors have always been turned away as a form of risk management. In the early days of sports betting, where every Vegas book just followed the Roxy line from Las Vegas Sports Consultants (LVSC), most of these books monitored action closely and realized that some bettors at their ticket windows were just sharper than LVSC. So rather than constantly losing to them, they told the sharp bettors to take their business elsewhere or gave them a limit where the risk was minimal. Many of the sharp bettors got around the ban by hiring people to place bets for them (known as beards) and they spread around the beards at different books and changed them up regularly so as not to attract notice. Because of Vegas’ history with the mob, these very sharp bettors were given the term wiseguys and several sportsbooks in Vegas made it clear they won’t accept any wiseguy action. In the last few decades, however, most sportsbooks both in Vegas and offshore realized that they were shooting themselves in the foot by turning away this action and relying exclusively on 3rd party linesmakers like LVSC. So, they approached the wiseguys and made a deal with them. The books would post a very early line on games (known as the outlaw line) and the wiseguys were told to bet on that line only and had a limited amount of time to get their bets down. The books were then able to move the line so that when the line was posted for the general public, the percentages were moved back in favor of the books. People like Billy Walters bet those lines and did well but in the end the sportsbooks won. So nowadays it is uncommon for books to turn away any action on major sports unless there is something up like believing a person has multiple accounts or suspicion of placing bets on events that could be fixed.

Vegas sportsbooks banning playersThat said there are instances that will get people turned away or limits cut drastically at most books in Vegas or offshore that aren’t related to fraud. Those include people who only bet money lines and particularly low percentage money lines and people who are just looking to scalp lines. Almost every bookmaker I’ve spoken to has told me that they love when bettors take any side of a point spread because the 10 or 15 cent line pretty much guarantees that in the long run they will make money. But money lines are risky. There was an old belief in the industry that if a book made the juice too high a bettor would never take it, but most bookmakers now realize lately that isn’t true. Because returns on investments are so poor in the U.S. now (a savings account may return 1% a year), sports betting is often seen as a better option. A bet on say the New England Patriots at -1000 on the money line at home over say the Buffalo Bills may seem like a terrible bet to most casual bettors but to professional bettors or to investors they may view this a 10% return as a far better option than buying blue chip stocks. And worse, off many professionals will parlay say three of these 1/10 favorites for a return of 1/3 odds, which could hurt a book’s profitability, if there are enough of them. That said, books will take this action if it’s not exclusive. Almost every bookmaker has told me that they have no issue with people wagering on money lines so long as it’s not their only bet. But if the bettor only takes money lines and never bets on spreads they will monitor that player and cut them off if need be. As well if someone is clearly just a line shopper (which I assume is what William Hill meant in their comments about screen scraping) who bets on lines with different books only if there is a scalp with another sportsbook to guarantee a profit they will be viewed as a non-preferred customer. After all the books are there for gambling, not as a bank.

"We try to offer lower juice as a favor to our regular clients," one sportsbook operator told me a while back "but we aren’t there as a scalp shop for professionals who are looking to bet at 2 books to guarantee a 2% profit. To continuously accept that action from those people would not be fair and we would have no choice but to raise our juice which would harm the clientele who are true gamblers in the sense of the word."

But that new philosophy applies to just the major sports like NFL, MLB, NBA, NHL or NCAA lines. For the less popular sports and for propositions, books will always be quick to turn away players since there is not nearly as much action on these sports or on props as there is on the games themselves. So, if limits were too high or if people were allowed to constantly win on them, the books would be guaranteed to lose money. It has only been in the last three decades that sportsbooks offered odds on events like golf, tennis, auto racing and offshore on special bets like the Oscars and it is understood that these lines will never be as sharp as the main sports or attract action like an NFL game will. As well, the vast majority of bets will be on favorites or on options where there is news that affects the line but gets to the public before it does to the books. Examples are an injury to a golfer, a grid penalty against a driver or some gossip regarding a movie. One sportsbook operator even told me that to make money on a normal tennis match they would need to have a 50-cent line or higher to have any chance at profitability. At the same time, most books want to offer those sports as a favor to non-professional bettors who enjoy betting on those sports to have action as they watch the event. The only way, therefore, they believe they can provide odds on those events and not risk a hit to the bottom line is either making limits immaterial or banning players who bet heavily only on those sports and constantly win, particularly if that is their only bets. If bettors on those sports are willing to put money on more profitable sports as well, like NFL or NBA spreads, then bookmakers generally will leave those bettors alone. But betting only on bad lines, betting only on one high risk sports or betting only on propositions will generally get a person kicked out of pretty much any sportsbook.

So that brings us back to the William Hill situation. Being relatively new to the Las Vegas market and new to the U.S. sportsbetting market it is quite possible that William Hill is cutting off a lot of people because they haven’t figured out the way to use wiseguys to help make them popular, but more likely it’s for reasons they mentioned, i.e. they discovered beards betting for wiseguys who don’t want to bet on the outlaw line or for bettors who are only betting low percentage lines and who are scalping William Hill lines versus another sportsbook. But they are new to the game in Las Vegas and New Jersey and almost certainly they will learn the tricks of the trade and will discover ways to make non-profitable bettors work for them.

Read insights from Hartley Henderson every week here at OSGA and check out Hartley's RUMOR MILL!