Monday 1 January 2001

Spoofing / Head-Faking

While the basic concept is easy to grasp and it sounds very easy to do, in fact trading has developed into quite a complex and tricky art, because people have designed bots and software to take advantage of the most obvious situations where trading should give you a profit. In addition there are people out there who manipulate the markets using “spoof” money, large sums which appear suddenly in an attempt to move the market in a particular direction.

These can disappear as fast as they appear, but it is often not easy to tell the difference between spoof money and real money until it is too late. When trading you are swimming in shark-infested waters and you need to have your wits about you or you will get eaten alive.

[Courtesy of Juicestorm]

Head fakes are bets placed on the opposite side of a bettor's actual preferred position on a game. They are used to disguise a bettor's true intentions and, more importantly, move the point spread to a more advantageous number. They occur most often in smaller markets, with less liquidity, such as college basketball, and second-half over/under totals in the NBA or the WNBA, but some bookmakers say they've even happened on the Super Bowl.

Done with precision, the most potent head fakes can prompt sportsbooks all over the world to move the line the wrong way.

It works like this: An influential bettor likes Duke +3 over North Carolina. When the first line appears at a prominent sportsbook, the bettor places a $1,000 head-fake bet on the Tar Heels -3. The bettor, who is aware of their influence on the market, expects the head fake on North Carolina to cause the line to move to -3.5 at the prominent sportsbook, as well as others. If successful, the bettor later places $40,000 in bets on Duke with the sportsbooks that inflated the line to +3.5. For $1,000, the bettor is able to place his larger wagers on the preferred side with a better line.

Bettors have been giving bookmakers headaches with head fakes for decades in Las Vegas. In the 1990s, renowned sports bettor William T. "Billy" Walters' head fakes became legendary and kept everyone guessing, "Which side is Billy on?" Art Manteris, who ran Las Vegas sportsbooks for 40-plus years, remembers wise guys head-faking on the opening line for Super Bowl XXXII between the Green Bay Packers and Denver Broncos. Today, head fakes play out in real time online, on odds screens that light up when point spreads and totals start to move.

"We're not a group that does head fakes -- that's not our business model," says Shane Sigsbee, who leads the high-volume betting syndicate ImawhaleSports. "But when I watch other groups do these head fakes, it's like art. It's beautiful the way they do it."
The head-fake master

In a world full of cunning wise guys, the most potent head fake of them all belongs to Walters.

"You can get caught with your pants down," longtime professional bettor Gadoon "Spanky" Kyrollos said about trying to decipher head fakes, "and the one that was notorious for it was Billy Walters."

After growing up in hardscrabble rural Kentucky, Walters moved to Las Vegas in the early 1980s, teamed up with the fabled syndicate the Computer Group and rose to the top of the sports betting food chain. For the past 40 years, Walters has had more influence on U.S. sports betting than anyone else. He has almost a mystical presence on the market, causing a sense of paranoia among bettors and bookmakers, who are constantly trying to figure out which of Walters' bets are legitimate and which are head fakes.

Even while Walters was serving time in federal prison for an insider trading conviction, rumors of which side he was on regularly circulated in the sports betting community. (Walters' sentence was commuted in January by President Donald Trump).

The running joke among professional bettors is that Walters never lost.

"If a game won, Billy was on that side," said a sports bettor who goes by "Fats" and worked with Walters for a year in Las Vegas. "If a game lost, well, that was a Billy head-fake game."
Head-fake history

The head-fake game has been going on for a long time.

In the mid-1980s, the Stardust casino and resort in Las Vegas was home to the most influential point spreads, totals and odds in the nation. When Stardust sportsbook director Scotty Schettler's crew put up a number, everyone paid attention -- including competing bookmakers in Las Vegas.

Bettors would line up every morning to get a crack at the Stardust's opening spreads, even going as far as hiring stand-ins to wait overnight and hold their place in line. The sportsbook put up stanchions to keep the herd of bettors organized, but they simply moved them out of the way. Schettler ultimately created a morning lottery, using a deck of cards to determine which bettors would get to go to the betting windows first.

As legend has it, the payphones outside of the sportsbook were the busiest in the nation, with associates of bookmakers from around the nation calling their bosses to report the Stardust lines. Some sportsbooks in Las Vegas would wait until after the initial wave of betting at the Stardust to see how the lines moved. They then copied the adjusted numbers and posted them at their own shops.

"Back in our day, people actually handicapped their own games, did their own work and bet their own opinions," Schettler told ESPN in a recent phone interview. "We actually made the line for the entire country. At 8 o'clock in the morning, we'd put our line up and the entire country followed it. Everybody."

The wise guys quickly figured out how to take advantage of the situation. Betting a few thousand dollars at the Stardust allowed them to basically create the line they preferred at every sportsbook in the nation. That is the true power of the head fake, the ability to move the line throughout the market, not just at one sportsbook.

"It only works if you're convinced other people are going to copy it," said iconic Vegas oddsmaker Roxy Roxborough. "And people copy it."
A bookmaker's head-fake headache

Head fakes play mind games with bookmakers, testing their confidence in their numbers, something that some veterans say is lacking today.

Manteris spent 40 years taking bets at some of the biggest sportsbooks in Las Vegas before retiring earlier this year. Few things rankled him more than head fakes, like the one he believes went down for Super Bowl XXXIII.

The Packers opened as approximately 11-point favorites over the John Elway-led Broncos. Manteris remembers a flurry of early action on Green Bay that pushed the number up to as high as -14. Then, as Super Bowl Sunday approached and limits increased, bigger money came in on the underdog Broncos. By kickoff, the point spread had dropped back down to Green Bay -11.

"It was wise guys betting the favorite," Manteris recalled during a recent phone interview. "It wasn't the public, it was wise guys who in the first 24 hours pushed it up 3, 3.5 points. The weekend of the game the line dropped all the way back to 11. I remember saying to myself, 'I can't believe we just allowed that to happen.'"

In the end, the Broncos won outright, so the point spread didn't matter in terms of the result, but in the long term, Manteris says that kind of up-and-down action cuts into the bookmakers' edge.

"You wind up having all of your money bet on the favorite at the lowest price, and all of your money bet on the underdog at the higher price," Manteris said. "You try to book at a good number, but you can't do that. You can't book the way you want to book with people intentionally manipulating the price.

"The reality is, [if] the bookmaker has total confidence in his own number, then you can negate [head fakes]. But you don't have that today, I don't have that kind of confidence in the numbers anymore. There's too much ambiguity. It's very hard to do in today's world, to have total confidence in the numbers."

And these days, the good numbers don't last long.
Part of the game

The Don Best odds screen is where today's virtual head fakes take place.

The Screen, as it's commonly referred to in the betting community, shows the point spreads, totals and odds from hundreds of sportsbooks from all over the world. Walk into any professional bookmaking operation and you'll find the Don Best screen on computer monitors.

Want to know the price on the latest Russian table tennis match at a sportsbook in Costa Rica? Don Best has it. Want to monitor for the latest line movement for next year's WNBA All-Star Game to post? Watch the Don Best screen, which lights up when the numbers start to move. Everyone is watching it.

Estimates vary on how many betting syndicates currently have enough influence to pull off head fakes, likely no more than a dozen or two at most, though. Trying to spot head fakes is a crap shoot in itself. A point spread will start moving in one direction at one prominent sportsbook; other sportsbooks copy the move, sometimes without even taking a bet, and then suddenly the line will begin moving in the opposite direction.

"You've got a matter of seconds," Sigsbee said. "This isn't something that lasts for seven or eight minutes. You've got 45 seconds to put all of this into action. We're trying to guess what's really happening and get down for ourselves as well. Honestly, sometimes we get faked out, too. We're just caught upside down on it.

"Head fakes are a huge part of the game."

And as long as bookmakers choose to copy lines on events like the WNBA All-Star Game, they always will be.

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