# Are casinos allowed to accept wagers that would exceed what they would be capable of paying out? **URL:** \ **Category:** The Game Room\ **Created:** [January 5, 2024, 9:15pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676 "2024-01-05T21:15:39Z")\ **Posts on this page:** 13\ **Page:** 1
**Author:** ![Velocity](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/velocity/32/18006_2.png) [@Velocity](https://boards.straightdope.com/u/Velocity)\ **Post date:** [January 5, 2024, 9:15pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/1 "2024-01-05T21:15:39Z")
This could go into either FQ or Game Room: I recall reading a news article about how Leicester City winning the Premier League championship (8 years ago) had been considered such an unlikely outcome that the betting odds were 5,000-to-1 against it at the time that the season began, and many betting houses reported that they had never paid out at such long odds before. That has me wondering: from a legal standpoint, are these houses allowed to take wagers that are incredibly unlikely to win, but _if_ they won, would bankrupt the house due to insufficient funds? Example: At the beginning of that season, if a super-rich gambler had walked into the establishment and said “I’ll bet 10 million pounds on Leicester City winning the title,” the bookies would have probably been delighted, thinking, “This guy is just giving us ten million pounds for free. We’ll never make easier money than this.” But when he had won that bet, the casino would be bankrupt given that it couldn’t afford to pay out 50 billion pounds. What would happen then? ---
**Author:** ![Dewey\_Finn](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dewey_finn/32/4222_2.png) [@Dewey\_Finn](https://boards.straightdope.com/u/Dewey_Finn)\ **Post date:** [January 5, 2024, 9:52pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/2 "2024-01-05T21:52:38Z")
I know that for things like hole-in-one contests (that pay out, for example, a million dollars if any player in a golf tournament hits a hole in one) there are specialty insurance companies that cover such bets, so there may be something similar for other sports bets. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [January 5, 2024, 9:53pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/3 "2024-01-05T21:53:48Z")
I remember stories of this happening in Las Vegas way back when. The casino had to pay out all the cash they had on hand and secure loans for the rest. The thing about making casinos legal is that casinos and patrons can be sued for their gambling debts. I assume casinos are set up as corporations so the owners won’t be held personally responsible for those debts but they probably don’t want to lose their interest in a money making machine as the result of bankruptcy due to a short term deficit. ---
**Author:** ![glee](https://avatars.discourse-cdn.com/v4/letter/g/b5a626/32.png) [@glee](https://boards.straightdope.com/u/glee)\ **Post date:** [January 5, 2024, 11:23pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/4 "2024-01-05T23:23:19Z")
> [@Velocity](#): > > At the beginning of that season, if a super-rich gambler had walked into the establishment and said “I’ll bet 10 million pounds on Leicester City winning the title I believe that when a punter tries to bet a huge sum of money (far more than bets the other way), the establishment can either refuse or adjust the odds. In real life, I think there was a punter who bet £100 on Leicester City at 5,000-1 odds (thus potentially winning £500,000.) With one or two matches to go Leicester City and Tottenham were the top two teams. The punter was offered something like £250,000 to settle the bet. (Sadly I don’t remember what he did!) ---
**Author:** ![kayaker](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kayaker/32/441_2.png) [@kayaker](https://boards.straightdope.com/u/kayaker)\ **Post date:** [January 6, 2024, 2:30am UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/5 "2024-01-06T02:30:04Z")
They may place a lay off bet. [layoff bet definition · LSData](https://www.lsd.law/define/layoff-bet#:~:text=Definition%3A%20A%20layoff%20bet%20is,protect%20themselves%20against%20excessive%20losses). ---
**Author:** ![Stratocaster](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/stratocaster/32/16393_2.png) [@Stratocaster](https://boards.straightdope.com/u/Stratocaster)\ **Post date:** [January 6, 2024, 6:02pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/6 "2024-01-06T18:02:10Z")
Their example of a layoff bet would do exactly the opposite of what they wanted: it would make their exposure worse. A nervous bookie would layoff a bet with some other entity for the same side getting all the action. ---
**Author:** ![colinfred](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/colinfred/32/21338_2.png) [@colinfred](https://boards.straightdope.com/u/colinfred)\ **Post date:** [January 6, 2024, 6:29pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/7 "2024-01-06T18:29:22Z")
There are things tlike big wheel games with a respin section that mathematically could go on for ever always hitting respin+, racking up unlimited liabilty; but in practical terms have no chance of it happening. ---
**Author:** ![DPRK](https://avatars.discourse-cdn.com/v4/letter/d/4491bb/32.png) [@DPRK](https://boards.straightdope.com/u/DPRK)\ **Post date:** [January 6, 2024, 6:42pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/8 "2024-01-06T18:42:03Z")
> [@](#): > > _As I walk along the Bois de Boulogne_ > _With an independent air_ > _You can hear the girls declare_ > _“He must be a Millionaire.”_ > _You can hear them sigh and wish to die,_ > _You can see them wink the other eye_ > _At the man who broke the bank at Monte Carlo._ ---
**Author:** ![John\_DiFool](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/john_difool/32/19543_2.png) [@John\_DiFool](https://boards.straightdope.com/u/John_DiFool)\ **Post date:** [January 6, 2024, 6:46pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/9 "2024-01-06T18:46:52Z")
> [@Dewey\_Finn](#): > > I know that for things like hole-in-one contests (that pay out, for example, a million dollars if any player in a golf tournament hits a hole in one) there are specialty insurance companies that cover such bets, so there may be something similar for other sports bets. The above is a relatively bad example, given that quite a few times the entity in question (be it the club or their sponsor or whoever) indeed refused to bequeath the prize in question: [https://www.fox5ny.com/news/hole-in-one-prize-winner-sues-after-country-club-withdraws-prize](https://www.fox5ny.com/news/hole-in-one-prize-winner-sues-after-country-club-withdraws-prize) [https://www.golfdigest.com/story/golf-tournament-hole-in-one-mercedes-benz-car-prize-lawsuit](https://www.golfdigest.com/story/golf-tournament-hole-in-one-mercedes-benz-car-prize-lawsuit) It also appears that Donald Trump himself stiffed another person who sunk an ace. But since these people didn’t actually wager anything, they may be off-topic for this thread. ---
**Author:** ![Mighty\_Mouse](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mighty_mouse/32/7776_2.png) [@Mighty\_Mouse](https://boards.straightdope.com/u/Mighty_Mouse)\ **Post date:** [January 6, 2024, 6:59pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/10 "2024-01-06T18:59:27Z")
> [@John\_DiFool](#): > > But since these people didn’t actually wager anything, they may be off-topic for this thread. Every time I’ve been in a golf tournament with a hole in one prize (usually worth a few thousand dollars at retail) either I or my employer had to stump us several hundred dollars at least for me to play in the tournament. That would be considered consideration for the wager wouldn’t it? ---
**Author:** ![Chronos](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/chronos/32/134_2.png) [@Chronos](https://boards.straightdope.com/u/Chronos)\ **Post date:** [January 7, 2024, 8:56pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/11 "2024-01-07T20:56:16Z")
Another point is that the casino is never betting just one side of anything. There are always bets from customers on all sides, and when the House loses one, they win others. If they’re keeping all of their action balanced, as casinos generally try to do, then it doesn’t matter how much folks are betting total, how much the casino’s bankroll is, or who wins: Any outcome will just involve one set of customers giving money to another set of customers (with a cut to the House). Of course, except for paramutual games like most horse races, the action won’t be perfectly balanced, so the casino’s account will still fluctuate slightly. But it’ll still be close. ---
**Author:** ![Shalmanese](https://avatars.discourse-cdn.com/v4/letter/s/45deac/32.png) [@Shalmanese](https://boards.straightdope.com/u/Shalmanese)\ **Post date:** [January 7, 2024, 10:49pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/12 "2024-01-07T22:49:39Z")
> [@Velocity](#): > > Example: At the beginning of that season, if a super-rich gambler had walked into the establishment and said “I’ll bet 10 million pounds on Leicester City winning the title,” the bookies would have probably been delighted, thinking, “This guy is just giving us ten million pounds for free. We’ll never make easier money than this.” But when he had won that bet, the casino would be bankrupt given that it couldn’t afford to pay out 50 billion pounds. What would happen then? That’s not how it works. Putting £10M alters the odds, probably significantly away. Generally, the odds are [amount of money bet on supporting side] / [amount of money bet on the opposing side] + [a spread for the bookie] If there were £10,000 on Leicester City and £100M against, then the bookie might be offering 5000:1 odds. Adding another £10M would make the new odds closer to 5:1. ---
**Author:** ![Riemann](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/riemann/32/3133_2.png) [@Riemann](https://boards.straightdope.com/u/Riemann)\ **Post date:** [January 7, 2024, 11:08pm UTC](https://boards.straightdope.com/t/are-casinos-allowed-to-accept-wagers-that-would-exceed-what-they-would-be-capable-of-paying-out/995676/13 "2024-01-07T23:08:40Z")
> [@Shalmanese](#): > > That’s not how it works. Putting £10M alters the odds, probably significantly away. Generally, the odds are [amount of money bet on supporting side] / [amount of money bet on the opposing side] + [a spread for the bookie] > > If there were £10,000 on Leicester City and £100M against, then the bookie might be offering 5000:1 odds. Adding another £10M would make the new odds closer to 5:1. That’s how a strict parimutuel or tote system works. And bookies who take the other side of bets at ante-post odds as principal certainly adjust their odds _somewhat_ along similar lines, to try to balance their books by responding to weight of money. But at some point all bookies are prepared to stand and take a certain amount of net risk on the outcome based on their confidence in their own estimate of the true probability - and thus heavily conditioned on whether it’s the type of event where non-public information might be significant.