The Edge Chairman Admits to Defrauding $18m in Betting Ring

  • Bill Vlahos founded the syndicate in 2008 using his own betting sheets
  • Bets often never laid and winners paid with money from other income streams
  • The Victorian racing identity has admitted to pocketing the rest of the cash
3D illustration of "ADMISSION of GUILT" title on legal document.
The founder of an Australian betting syndicate has admitted to fraud totaling $18m Australian Dollars for the first time. [Image: Shutterstock]

Syndicate betting ring

Bill Vlahos, founder and chairman of The Edge betting syndicate in Australia, has admitted to creating a complex betting ring fraud that took place over five years and totaled $18m AUS ($12m).

Earlier this week in the Victoria County Court, the previous chairman of BC3 Thoroughbreds, pleaded guilty to two charges of obtaining financial advantage by deception between 2008 and 2013. He was first charged three years ago, but has since negotiated the amount of criminal activity down.

pleaded guilty to two charges of obtaining financial advantage by deception

The Melbourne-based racing legend was originally charged with 374 offenses. Many of these were later withdrawn, including multiple counts of obtaining financial advantage by deception and one count of attempting to destroy documents to be used as evidence.

This brought the total amount of money he was accused of defrauding down from $120m ($80.1m) to $17,520,225m AUS ($11,696,502m).

Bets never laid

According to court documents, Vlahos set up The Edge punting club in 2002/2003, which relied on a system that helped him select and back winning horses. He claimed that his winning selections were a result of his knowledge in statistics, which he studied to obtain his psychology degree.

At first, Vlahos was paid 5% of all winnings, but with no written agreements and dealings conducted under secrecy, the court is expected to call a variety of witnesses to get to the bottom of the scheme.

A statement of agreed facts included information that Vlahos himself sent out betting sheets before the start of a race weekend, usually for meets within Melbourne and Sydney. But the bets were often either never laid, or only a small portion put down. Instead, Vlahos pocketed the money into his own personal account.

He would then send out his own “results” after the race. A court document stated that

The betting numbers attached to the betting sheets were not true or accurate and the betting and results sheets contained false information.”

Ponzi scheme

The court made referred to the syndicate as a “Ponzi scheme” in which money from investors effectively paid for winnings. Funds were also moved around from other businesses that Vlahos controlled, including a stud farm and a wine distribution center.

Investors were encouraged to keep spending with the club, with the promise of accessing international race meets. This was through a man called Daniel Maxwell who was later found to be fictional.

A race that took place in May 2008 was mentioned in court documents. Vlahos was supposed to have put down $219,000 ($146,200) on a horse called Gorky Park, winning $657,000 ($438,6100) in return. Instead, the truth was that the bet was only for $2,500 ($1669), resulting in a return of just $9,000 ($6,008).

The syndicate ended suddenly in December 2013 as Vlahos faced financial difficulty. It is thought that despite having over 1000 people involved initially, the demand for cash payouts forced the business to close.

Vlahos now penniless

It is thought around 68 victims will tell the court how the syndicate affected them.

During the hearing, Vlahos’ bail was extended until he returns to court on February 4, 2020, for his pre-sentence hearing, scheduled to run before Judge Douglas Trapnell for two days.

Despite his previous notoriety in the betting scene, Vlahos’ lawyer argued that his client should not be seen as a flight risk as he had now lost all of his money and was penniless. He filed for bankruptcy in 2013.