Posted on: May 7, 2024, 02:08h.
Last updated on: May 7, 2024, 02:29h.
A Sydney, Australia man who claimed he had developed an algorithm to gain an edge against the bookies could avoid a prison sentence for defrauding investors in his sports betting fund, the Australian Associated Press (AAP) reports.
Michael Pryde, 32, was the sole director of now-bankrupt Simply the Bets Pty Ltd., which used the algorithm to bet on baseball and basketball games, as well as golf and horse racing. He convinced more than 100 investors, many of them friends and family members, to part with AU$5.5 million (US$3.6 million) to fund the gambling scheme, according to his bankruptcy trustee.
Pryde pleaded guilty in March to dishonestly obtaining financial advantage by deception and using a false document to obtain financial advantage. He also admitted defrauding 18 Simply the Bets investors out of AU$1.2 million (US$790K).
Pryde Before the Fall
Pryde’s lawyer, John Sutton, told a Sydney court Tuesday that it hadn’t been his client’s intention to defraud anyone and that the scheme initially got off to a good start, according to the AAP.
Between August 2018 and January 2023, Pryde returned AU$2.4 million to participants and earned around AU$320K as part of his agreed 20% cut.
The fraud began when the defendant started accepting money from new investors at a time when things were going badly. He abandoned the system and began chasing his losses in an effort to dig himself out of a hole.
Quickly, he was losing money because he was gambling outside the model in an impatient, imprudent way, a reckless way,” Sutton told the court. “Inevitably, the house won or, put in another way, the scheme lost.”
Pryde then compiled a fraudulent document in an attempt to delay bankruptcy in the hope he could win the money back by gambling even more recklessly – a strategy that failed to pay off.
‘Naïve, Embarrassing’
“This was so naive as to be embarrassing,” Sutton told the court, adding that his client was “no Melissa Caddick.”
Melissa Caddick was a bogus Australian financial advisor who, shortly before her disappearance in 2020, defrauded friends and family of around AU$30 million as part of a Ponzi scheme. Caddick splurged on houses, luxury cars, designer clothing, jewelry, and expensive works of art.
In contrast, Pryde lived relatively frugally and didn’t use any of the investors’ money for his personal expenses. He is also remorseful, and is seeking help for gambling addiction, Sutton said.
Sutton asked the judge for an intensive corrections order served in the community as opposed to a full prison sentence for his client.
Pryde is scheduled to be sentenced Thursday.