30 Jul 2014 Disciplinary Panel - Integrity Issues

Between 7 and 9 July 2014, the Disciplinary Panel of the British Horseracing Authority (BHA) held an inquiry into allegations of engagement in corrupt lay betting levelled against William Hinge, Keith Young and David Vivash.

1. The principal charge, faced by all three of them, was that they acted in breach of Rule (A)41.2. This Rule outlaws conspiracies to commit corrupt or fraudulent practices. It was alleged that lay bets in a total of 17 races were placed by Mr Young and Mr Vivash using inside information provided by Mr Hinge, who was in every case the owner or part owner of the horses concerned.

2. Just Mr Hinge was alleged to be in breach of Rule (E)92.2, to the extent that the lay bets placed against his horses in those 17 races were bets placed on his behalf. He further faced the charge of breach of Rule (A)36.1 – that he provided inside information for reward to Mr Young and (through Mr Young) to Mr Vivash. The reference to Rule (A)36.1 is seemingly a slip for (A)36.2, and has been so treated by this Panel. No point has been taken by anybody that this slip has caused any problem or misunderstanding.

3. Each of Mr Young and Mr Vivash were the subjects of an additional allegation that they were in breach of Rule (A)37 because they were said to have “encouraged, assisted or caused” Mr Hinge to act in breach of Rule (A)36.2 and Rule (E)92.2.

4. The BHA’s case was presented by Louis Weston. Mr Hinge participated fully in the proceedings. He was represented at the inquiry by George Spalton, instructed by Riverview Law. Before the hearing, he attended two interviews with BHA Investigators, provided the telephone and some betting records for which he was asked, and filed the Schedule (A)6 form setting out the nature of his defence to the allegations, together with statements of witnesses upon whom he relied. Mr Young and Mr Vivash took a more limited part. Each of them gave two interviews to BHA Investigators. But Mr Young refused to provide telephone records that were requested of him, citing the need to preserve confidentiality for his clients. Mr Vivash, on the other hand, did provide some telephone records as asked. He also filed a Schedule (A)6 form containing a bare denial of breach of the Rules, and announcing that he would take no further part in the proceedings. He did not attend the inquiry, but he did provide a written statement to Mr Hinge’s solicitors, which was deployed at the hearing. Mr Young provided a Schedule (A)6 form which identified the nature of his case in a couple of sentences. He did come to the hearing to give evidence as a witness called by Mr Hinge, but otherwise took no further part.

 

A summary of the case issues

5. The BHA’s case depended upon three basic strands of evidence. These were (i) betting records and associated evidence, (ii) evidence of telephone contacts, presented in the form of timelines, and (iii) transcripts of interviews. There was no dispute about the accuracy of these primary materials. These revealed, it was said, that Mr Hinge clearly had inside information about the prospects of his horses in the 17 races. (A table of the races in question is annexed at A to these reasons). The available evidence of telephone contacts showed discussions between Mr Hinge and Mr Young before the races, as well as frequent contacts between Mr Young and Mr Vivash. Betting accounts under the control of Mr Young and Mr Vivash with Betfair and Betdaq were used to place lay bets against Mr Hinge’s horses. The betting accounts disclose substantial risks being taken on Hinge-owned horses, and these risks were also exceptional when compared to the overall market. It was contended that such betting must have been inspired by inside information provided by Mr Hinge, and that it was legitimate to infer that this was being done for the benefit of all three of Messrs Hinge, Young and Vivash.

6. For Mr Hinge and Mr Young, the essence of their response was that Mr Hinge did not pass on inside information. Though he had frequent contacts with Mr Young by phone, these would generally be to ask about prices available for racing on any given day. He would naturally ask Mr Young, whom he used as a commission agent because he (Mr Hinge) had had all but one of his bookmakers’ accounts closed, for a price on one of his own runners. If he decided not to take that price, Mr Young treated that as a signal for lay betting against that horse, and to do this he used both his own Betfair accounts and occasionally Mr Vivash’s Betdaq accounts. Mr Vivash personally bet against Mr Hinge’s horses in the 17 races on a number of occasions, but denied this was on the basis of inside information relayed to him by Mr Young. He explained in his interviews and statement that these lay bets were placed in part upon his own form judgements, and in part because he had heard from Mr Young that Mr Hinge was not backing them.

 

The lay betting and telephone contacts

7. As mentioned, there was no dispute about the facts of the lay bets placed on the accounts controlled by Mr Young and Mr Vivash. On each of the 17 races, Messrs Young and Vivash combined risked more than £10,000 on lay bets. The size of these bets was above the average bet sizes for these accounts and they were part of a small number in each race of bets above £10,000. They were regularly amongst the highest risk liabilities on accounts held by Mr Young. And for Mr Vivash, they were likewise all among the highest liabilities on the accounts he controlled if one removes main race meetings like Royal Ascot and Group 1 races. For 6 of the 17 races, the bets were the largest on the Betfair market. In all of the races, and in particular when betting in the place market, the accounts took sizeable percentages of the overall markets.

8. That regular degree of confidence, displayed by two professional gamblers, must have had some strong justification in their minds. Both Mr Young and Mr Vivash sought to compare the size of these horseracing bets with bets they placed in other spheres such as tennis or cricket. The Panel felt that that was a false comparison. There could be all sorts of reasons for their propensity to bet big on other sports. What mattered in the present context was why they were regularly prepared to place such large horseracing lay bets that were beyond their usual size, and to concentrate on Hinge-owned horses. (A table setting out the bets is annexed B to these reasons). As will be seen, all the lay bets were successful apart from lay bets in the place market for races 3 and 4.

9. Equally, there was no dispute about the evidence of telephone contacts between Mr Hinge and Mr Young on the one hand, and Mr Young and Mr Vivash on the other. The picture emerging from the timelines presented to the Panel was a striking one. There was a pattern of contacts between Mr Hinge and Mr Young closely followed by the placing of lay bets by Mr Young. Indeed, in more than one case, Mr Young began placing his lay bets while actually on the phone with Mr Hinge. Indeed, the evidence of Mr Hinge and Mr Young accepted that there was a causal connection between calls from Mr Hinge and the placing of lay bets. Their contention was, however, that these were lay bets placed by Mr Young on his own initiative and without disclosing this to Mr Hinge, because Mr Young thought it was a worthwhile lay bet when Mr Hinge had not taken a price offered on his ho.

10. When deciding the issues, the Panel of course recognised that the burden of proof fell upon the BHA. The BHA had to demonstrate to the Panel’s satisfaction on the balance of probabilities that the allegations of breaches of the Rules were made out.

11. Having considered all the evidence put before it, the Panel was left in no doubt that the explanations proffered by Mr Hinge, Mr Young and Mr Vivash for the lay betting against Hinge-owned horses were untruthful. The lay bets were placed by Mr Young on the basis of inside information provided by Mr Hinge and with Mr Hinge’s knowledge and agreement. Mr Young further recruited Mr Vivash to help in placing the lay bets. Mr Vivash was aware that these were bets worth laying because of inside information from the owner.

12. The Panel felt driven to these stark conclusions for a sizeable number of reasons:-

(i) There was no sensible explanation for the frequent telephone contacts between Mr Hinge and Mr Young that occurred after the races if their version was truthful. On the other hand, there was good reason to speak and exchange information about the financial result of the lay bets if both were engaged on this exercise. The suggestion that Mr Hinge may have called to ask Mr Young about how his horse had run was not realistic, particularly given that Mr Young disowned any real knowledge of horseracing form and performances.

(ii) In betting terms, there was no believable reason why a seasoned gambler like Mr Young should be taking such large lay bet positions simply upon hearing from Mr Hinge that the latter would not back his horse at a price indicated to him. As the price indicated would have been derived from Mr Young’s bookmaking contacts, it makes no sense that he should then promptly lay the horses with Betfair or Betdaq at prices that are likely to have been a point or two longer. On Mr Hinge’s and Mr Young’s versions of their exchanges in phone calls, Mr Young would have had no idea about the price at which Mr Hinge might have been prepared to back his horse. Nor would the fact that Mr Hinge said “no bet” when a price was indicated to him by Mr Young provide the latter with any reason for heavy lay betting, when he was unaware of what bets might have already been placed or might still be placed by Mr Hinge through his Apollo account, through Betfair (with whom Mr Hinge had an account) or with others unknown to Mr Young.

(iii) Mr Young did not follow with his personal betting Mr Hinge’s back betting on other occasions. If Mr Hinge was the smartest gambler whom Mr Young had ever come across (and he must have been if Mr Young was telling the truth about the fact that he “seldom” placed lay bets against the horses of other owners for whom he sometimes acted as a commission agent), one would expect to see him follow back bets as well.

(iv) Remarkably, there were lay bets against Hinge-owned horses in the place market in 11 of the 17 races. An announcement by Mr Hinge that he would not take a price offered by Mr Young on his horse can have provided no basis for that. Though stated shortly and baldly, this point is enough on its own to dismantle any belief in the version of events spoken to by Mr Hinge and Mr Young.

(v) On some occasions, Mr Young’s lay betting showed extreme price insensitivity. For race 5, his lay bets were at odds ranging from 10.94 to 18.26, and for race 9 the odds stretched from 3.45 to 5.2. If Mr Young’s information was just that Mr Hinge was not prepared to bet at a price around about the shorter levels in those races, there was no warrant for him thinking that it might be thought a good lay bet at the higher levels.

(vi) The fact that on at least three occasions, (races 1, 2, and 12), Mr Hinge and Mr Young were actually speaking on the phone to each other at the same time as Mr Young was placing the lay bets strongly suggests that those lay bets were the subject of their conversation. Similarly, on nine other occasions, calls from Mr Hinge were in such close proximity to the lay betting as to suggest that this betting was the subject of the call.

(vii) It was Mr Hinge’s case that he only learned of lay betting against his horses by Mr Young and Mr Vivash after race 12 in November 2011. The account which he gave of this both in his written statement and in evidence before the Panel was remarkable for the lack of any reaction or hostility on the part of Mr Hinge towards Mr Young in particular for having placed lay bets against Hinge horses without his knowledge. Mr Hinge had particular reason for seeking to avoid any suspicion of involvement in lay betting: in September 2009 he was found in breach of the lay betting Rule by a Disciplinary Panel of the BHA. Even more surprisingly, he continued to have dealings on a regular basis with Mr Young throughout the remainder of the period covered by the 17 races (i.e. up to June 2012). For races 13-17, it remained the case for Mr Hinge and Mr Young that the same sequence of events was occurring – i.e. that Mr Hinge would telephone Mr Young to ask about prices, would sometimes say “no bet” when offered a price on one of his horses, and this would then prompt Mr Young (and through him Mr Vivash) to continue their heavy lay betting. The Panel found it incredible that this could have happened.

(viii) Prior to races 1, 4 and 17, there occurred some back betting by Mr Hinge through his Betfair account on the horses in question. These back bets were (with one exception) placed either the night before the race or early in the morning of the race. At those early stages when the market was small in size, such betting had the effect of shortening the price sharply. The obvious inference from this conduct is that Mr Hinge was “spoofing” the market, in the hope that outsiders would think the momentum indicated a good reason to back the horse, thus creating liquidity for the eventual lay betting. It was the Panel’s conclusion that this was the purpose of these exercises. Much time was spent at the hearing investigating an alternative explanation for these back bets put forward by Mr Hinge. It was that he was trying to damage people he called “market thieves” – i.e. people who monitored price momentum closely, who would often move in to shorten prices on days when one of his horses was, he thought, likely to win. Their activities would deprive him of reasonable prices. So, Mr Hinge said, his back bets for races 1, 4 and 17 were designed to create a false impression for outsiders, to seek to deter them from following shortening price momentum for his horses in the future. But this explanation was not one which he gave when first interviewed by BHA Investigators. He said he was reminded of it later after talking with his co-owner Mr John Searchfield. That did not feature in Mr Searchfield’s evidence. The Panel felt bound to conclude that this alternative explanation for Mr Hinge’s back betting was a later construction, designed to avoid the damage of the inference that the Panel has in fact drawn – namely that these instances of back betting show that Mr Hinge was very much in league with Mr Young and that the back bets were designed to create a favourable environment for the later lay betting.

(ix) For race 12, there was lay betting by two other associates of Mr Hinge – Mr Tony Campbell (another betting commission agent used by Mr Hinge) and Mr Darren Murphy (a friend). It was not suggested that they did this on the basis of any contact with Mr Young. It is probable that they did so on the basis of negative information from Mr Hinge.

(x) As the unchallenged evidence of the BHA betting analyst Tom Chignell revealed, both Mr Young and Mr Vivash had a marked bias towards lay betting of horses owned by Mr Hinge. Their individual bets were either the largest, second-largest or third-largest to be found within the particular accounts used,

(xi) Though Mr Vivash had never met Mr Hinge, he knew of him by name and knew that he used to bet through Mr Young. He accepted when interviewed by BHA Investigators that by about May 2011 he, Mr Vivash, knew that Mr Young had a contact who “knows something about Musson horses”. Shortly thereafter, it became clear to him that it must have been Mr Hinge. Mr Vivash was fully aware of Mr Young’s propensity to make use of inside information if he could get hold of it. At some uncertain date, Mr Vivash became angry with Mr Young, in a conversation which he revealingly disclosed during his second interview. He had been asked to place lay bets for Mr Young for a horse in a particular race at Wolverhampton (not one of the 17 races with which this inquiry was concerned). When he saw the race, he formed the view that “the jockey pulled the horse’s head over [at] the start.” He was angry with Mr Young for involving him in such a matter and rang him to say “Keith, don’t ever fucking ring me with anything like that ever again”. Mr Vivash was prepared to participate in betting inspired by inside information about prospects, but not if that information was about an impending stopping ride. But these matters demonstrate a more general and complete lack of scruple on Mr Young’s part in exploiting inside information.

 

Inside information

13. It is apparent from the foregoing that the Panel concluded that the lay betting by Mr Young and Mr Vivash in the 17 races was carried out in league with Mr Hinge and that it must have been based upon inside information that they all thought was sufficiently reliable to warrant such betting. The size of the betting in those races, together with the view taken by the Panel that the version of events given by all three is untruthful, lead of themselves to the view that inside information from Mr Hinge was the genesis of the lay betting.

14. There was considerable investigation at the inquiry hearing of what that inside information might be. The Panel heard evidence from Mr Searchfield, Victor Dartnall (who trained two of the horses), and Willie Musson (who trained four of them). It also had a statement from Lee Carter, who took over the stables of the late John Akehurst, who trained just one of the horses involved in the 17 races.

15. It was not alleged on behalf of the BHA that any of the horses was given a stopping ride or that their trainers or others at their yards took positive steps to impair a horse’s chances to give encouragement to lay betting by Mr Hinge.

16. Mr Hinge is and was an involved and committed owner of horses, and he was in the habit of speaking regularly with his trainers. He accepted that he would have had inside information from the trainers in the case of the horses involved in all 17 of the races. His position was, however, that the information was not negative or at least that it was not so negative as to explain the lay bets. But as Mr Hinge’s contention was that he passed no information to Mr Young and that he was not involved in the lay betting – a case which the Panel has rejected – an analysis of what if any negative inside information he had to pass on is not strictly required. It is sufficient to say, as has already been held, that he must have held some view based upon inside information that led him and the others into the lay betting enterprise. Of course, inside information can stretch from relatively mild items, such as that a horse has not been working too well at home, to much more sinister matters such as an arrangement with a jockey that he will take steps to prevent a horse from winning if necessary. The Panel makes no positive finding that there was such sinister inside information behind the lay betting, but the possibility requires to be recognised.

17. In any event, the Panel did find that there were elements of negative information in respect of the seven horses involved in the 17 races, even if this information does not reveal the full picture upon which Mr Hinge acted.

18. For JEZZA, the trainer Dartnall felt that he had been found out on the flat with his rating for race 1, hence the later switch to hurdles for races 2 and 7. The trainer was concerned about his ability for hurdles, and was starting to lose faith by the time of race 7. For HENRY HOOK (IRE), Dartnall thought that the horse would struggle at the distance, and was not a good jumper. For ROCKET ROB (IRE) (races 4, 5, 6, 8, 10, 12 and 16) – the horse had suffered an injury from a fall in 2010 and was not showing the same form with its new trainer, Musson. At the end of 2010, the owners had been told by Frankie Dettori who rode it in its last race of that year, that it still had not recovered from its injury. Further, the new trainer and Mr Searchfield felt that the horse was struggling for confidence and for at least one of the races had concerns about the ground. For PRINCE OF SORRENTO, the concern was with long-standing niggling problems as well as the aftermath of an operation. For KUHN JOHN (IRE), the horse had been hobdayed. For HURRICANE HYMNBOOK (USA), the horse had had a series of substantial health problems when off the course for a lengthy period, and was known to be better at home than at the races. For ABSENT AMY (USA), there was a history of breaking blood vessels.

 

Payments?

19. There was no direct evidence to show that Mr Hinge receive payment from Mr Young for the inside information, and generally nothing to show whether or how the three of Mr Hinge, Mr Young and Mr Vivash divided up the proceeds of the lay betting. Mr Hinge sought to demonstrate that there were no payments flowing to him from Mr Young which could represent such payments. He called his accountant, Mr Michael Cox, to assist in proving that. But Mr Cox was shown nothing more than a partial sample of Mr Hinge’s bank statements. When conducting his exercise, he simply looked for a figure of up to 100% of the winnings alleged on the lay bets for the individual races to see if such a sum was ever passed to Mr Hinge in the following week or so. He was not shown (and nor was the Panel shown) the betting records which Mr Hinge said he kept in his diary. So the exercise undertaken by Mr Cox was of negligible value. There were payments flowing between Mr Hinge and Mr Young in the bank statement pages that were revealed, but nothing to explain the make-up of them.

20. The Panel felt it safe to conclude that there must have been payment shared with Mr Hinge by Mr Young, who will have brought into account the money coming in from the Mr Vivash lay bets also. If nothing else, the Panel felt it certain that Mr Hinge would have looked for some recompense for his back bet “spoofing” of the market in races 1, 4 and 17. It is not possible to say what form or amount that recompense took. But in the light of the Panel’s finding that the stories of Mr Hinge and Mr Young about the latter’s lay betting are concoctions, there is no difficulty at arriving at the further conclusion that they were all doing it for money or money’s worth.

 

Results of the findings

21. The consequence of the Panel’s findings set out above is that it holds Mr Hinge to be in breach of Rule (A)41.2 – he was one of the two central figures (along with Mr Young) in the corrupt agreement to lay Mr Hinge’s horses in 17 races. Those findings also establish that Mr Hinge was in breach of Rule (E)92.2 – he was laying his own horses through Mr Young and (via Young) through Mr Vivash. Further, breach of Rule (A)36.2 is also clear: the finding that the conspiracy existed establishes the ingredients of that breach.

22. Mr Young was engaged in the conspiracy, in breach of Rule (A)41.2. He was also in breach of Rule (A)37 in that he assisted Mr Hinge’s breaches of Rules (E)92.2 and (A)36.2

23. Mr Vivash was also engaged in the conspiracy in breach of Rule (A)41.2. It should be explained that his role was a lesser one than theirs. He was aware from the outset that inside information was being exploited for lay betting purposes by Mr Young, and later during the period of the 17 races became aware that the source of the information was Mr Hinge. He was not an unwitting provider of access to his Betdaq accounts but an active participant, aware of and sharing in the proceeds of lay bets inspired by inside information.

24. The findings also show that Mr Vivash was in breach of Rule (A)37, as he too assisted Mr Hinge’s breaches of Rules (E)92.2 and (A)36.2.

 

Penalties

25. For breaches of Rule (A)41.2, the Guide to Procedures and Penalties identifies a potential period of disqualification of between six months and 10 years, with an entry point of three years. Of course only Mr Hinge as a registered owner is capable of being disqualified in any event; Mr Young and Mr Vivash are not licence holders or otherwise subject to the Rules of Racing.

26. When considering an appropriate period of disqualification to impose, the Panel was particularly influenced by two unhappy features of Mr Hinge’s case. The first was that he had already had one disciplinary run-in for lay betting against his own horses in 2009. The second is that this case involved a prolonged period of rule breaking – there were 17 races over 16 months, which produced improper gains of £82,000 from corrupt lay betting. Against that the Panel was asked on Mr Hinge’s behalf to set a number of factors including that these were not cases of stopping rides, collusion with trainers or stable staff. The Panel was also asked to reflect that Mr Hinge was and remains a lover of the sport and regrets the findings made against him, which he does not intend to appeal. The Panel accepted that he was a committed and knowledgeable racing man, which serves to heighten the regret at having to put him outside the sport for a considerable time, but cannot deter the imposition of an appropriate period of disqualification.

27. In all the circumstances, it was decided to disqualify him for seven years. That penalty takes effect from 31 July 2014 (the day after the hearing to decide upon penalties) until 30 July 2021 inclusive. The Panel considered whether the disqualification should begin at once on 30 July 2014, when informed that a horse part-owned by Mr Hinge, OVERRIDER, was due to run in the 5.50pm race at Sandown. In principle, that should not be allowed. But as the horse is half owned by the trainer, Paul Cole, and as Mr Hinge had undertaken not to go to Sandown for the meeting, it was decided not to take steps to prevent it from running. However, the Panel reserved to itself the power to impose a fine equivalent to Mr Hinge’s share of any prize money that may be won.

28. Mr Young and Mr Vivash are liable to periods of exclusion. To reflect the Panel’s estimation of their levels of responsibilities within the conspiracy, Mr Young was excluded for seven years from 31 July 2014 until 30 July 2021 inclusive and Mr Vivash for five years from 31 July 2014 until 30 July 2019 inclusive.

29. As the other Rule breaches found in this inquiry did not involve any different conduct to that considered under the conspiracy heading, it was not felt necessary to impose any separate penalties for those breaches.

 

Notes to editors:

1. The Panel for the hearing was:  Timothy Charlton QC (Chair), Diana Powles, Ian Stark

2. The 17 races involved are as follows:

No.	Date	Horse	COURSE	Race
1	26.2.11	JEZZA	LINGFIELD	1.35pm, 1m 5 F Bet On Todays Football At Bluesq.Com Handicap
2	11.5.11	JEZZA	FONTWELL	3.45pm, 2m2 ½ F, Wetherbys Bank Maiden Hurdle
3	14.5.11	HENRY HOOK (IRE)	BANGOR	3.35pm, 2m 4 ½ F, Bangorraces.Co.Uk Novices Chase
4	21.5.11	ROCKET ROB (IRE)	HAYDOCK	4.05pm, 6f, Betfred Text “Fred” To 89660 Handicap
5	29.5.11	ROCKET ROB (IRE)	NOTTINGHAM	2.50pm, 5f, Fireman Sam Visits Twinlakes -2nd July Handicap
6	10.6.11	ROCKET ROB (IRE)	YORK	4.25 Pm,5f, Charles Chinkard Fine Footwear Anniversary Stakes
7	14.6.11	JEZZA	NEWTON ABBOT	6.45pm, 2m 1f, Silent Whistle Ashburton Maiden Hurdle
8	5.8.11	ROCKET ROB (IRE)	NEWMARKET	8.30pm,6f, Play Mecca Bingo On Your Mobile Handicap
9	27.8.11	PRINCE OF SORRENTO	WINDSOR	7.10pm, 1m ½ F, Toteswinger Handicap
10	24.9.11	ROCKET ROB (IRE)	CHESTER	5.20pm, 6f, Advanced Insulation Plc Handicap
11	18.10.11	HURRICANE HYMNBOOK (USA)	YARMOUTH	4.20pm, 1m, Spiffing Crabbies Alcoholic Ginger Beer Handicap
12	16.11.11	ROCKET ROB (IRE)	KEMPTON	4.40 Pm, 5f, Betdaq Multiples Handicap
13	3.2.12	PRINCE OF SORRENTO	WOLVERHAMPTON	3.15pm, 1m ½ F, Stay At The Wolverhampton Holiday Inn Handicap
14	15.2.12	KHUN JOHN (IRE)	KEMPTON	5.40 Pm 1m 2f Betdaq Multiples Handicap
15	22.2.12	HURRICANE HYMNBOOK (USA)	KEMPTON	6pm, 1m 2f, Betdaq Multiples Handicap
16	12.5.12	ROCKET ROB (IRE)	ASCOT	5.10pm, 6f, Alfred Franks And Bartlett Sunglasses Handicap (Div Ii Of The 4.35pm)
17	13.6.12	ABSENT AMY (IRE)	KEMPTON	8.40pm,7f, Rewards4racing.Com Fillies Handicap