Hollywoodbets to collect R13m in 'winnings' paid to unlucky punters

They thought they had hit the jackpot, but gamblers have been forced to pay back their winnings — estimated to be collectively R13m — after online sports and entertainment betting operator Hollywoodbets secured a court order against them.

Hollywood Sportsbook KwaZulu-Natal first secured an interim order against about 170 gamblers and their respective banks in January this year after it discovered a “glitch” in one of its games which allowed punters to place bets and win without putting up any money of their own.

In terms of that order, their bank accounts were frozen.

In the ensuing months the case came before several judges and various orders were granted.

Ultimately it came before Pietermaritzburg high court judge Rob Mossop this week, in which Hollywoodbets sought final orders against about 100 punters who had scored big on a game called “Betgames Instant Lucky 7”.

The game was online for a week in December 2023 and was touted as being “similar to a lotto ticket”.

The rules required the punter to have an account with Hollywoodbets with sufficient money to cover the extent of the bet. No gambling on credit was permitted. That money could be used to purchase multiple numbers in a draw which happened every 30 seconds.

But there was a design flaw. The bets were not deducted from the punters’ accounts and, in effect, they were gambling for free and at no risk to themselves.

In that week, the punters collectively “won” R13m. One, who placed 40 bets, won more than R400,000 which he withdrew from his Hollywoodbets account and deposited in his personal bank account.

Mossop, in his ruling, said the game came to an end when Hollywoodbets picked up “suspicious levels of winnings”.

It made no difference whether the punter lost. A loss would have no financial consequences because, in reality, the punter did not lose anything because he or she did not pay the consideration necessary to take the wager

—  Judge Rob Mossop

“Upon discovering what had occurred, the respondents [the punters] were contacted by representatives of the applicant [Hollywoodbets] who read from a prepared script and requested them to repay their winnings,” Mossop said.

“Almost all of them refused.”

He said the standard terms and conditions when opening an account dealt thoroughly with what constituted a valid bet, that there had to be available funds in a punter’s account and winnings paid under a “void bet” would be forfeited.

In terms of the order granted in January, the punter’s personal bank accounts were frozen and the banks were directed to pay Hollywoodbets, within seven days, the amounts identified as being their unlawful “winnings”.

The punters, in opposing the application, denied they had behaved unlawfully or had committed fraud or theft. They said they had been prejudiced by the freezing of their accounts, their debit orders had not been met and their credit scores were adversely affected.

“Without exception, they do not see why they should have to repay their winnings,” the judge said.

Discussing the legal components of a “wager”, Mossop said they had been able to gamble for free and there was no risk attached to what was wagered.

“It made no difference whether the punter lost. A loss would have no financial consequences because, in reality, the punter did not lose anything because he or she did not pay the consideration necessary to take the wager. Once they realised winnings could be obtained for no consideration, each of them increased their bets to maximise their winnings.”

He said the terms and conditions comprehensively covered a situation in which an invalid bet occurs and specifically provides for Hollywoodbets to recover any winnings.

The punters had not addressed this crucial issue “and I must conclude that they are not able to refute it”.

The judge said while Hollywoodbets had suggested there was a “conspiracy” to defraud it, pointing to the respondents' affidavits in which they indicated they told other people about how easy it was to win on the game, he did not accept this argument. This was because they were scattered all over the province and the country and no relationship had been established that linked one to the other.

Regarding the January interim order, Mossop said he could not understand why all transactions on the punters’ bank accounts had to be frozen when it was entirely possible there were funds in those accounts in excess of the winnings which would have to be repaid.

He said application had also been brought ex parte (without notice to the other side) and it was possible that money was taken from the accounts without the punters receiving any notice.

“Despite these misgivings, the interim relief claimed was granted and cannot now be undone.”

However, he ruled the punters were not entitled to the winnings and  confirmed the interdict.