A common question we get at HorseTourneys is regarding the withdrawal of funds that have been deposited but not ultimately played. For example, a person may deposit funds and then try unsucessfully to play in contests (such as Head-to-Head events) that may not fill up. Or, perhaps a racetrack has to cancel due to weather. Why shouldn’t players be allowed to pull that money back out?
The policy of not allowing deposited funds to be withdrawn is virtually a universal one in the online gaming sector, and not a matter of being player friendly or un-friendly. There are several reasons why this is so, and why it’s one of the strictest rules we must maintain here at HorseTourneys. They are:
(1) HorseTourneys pays merchant fees on all deposits players make
To accept deposits, merchants like HorseTourneys pay fees to banks and payment processors. These fees vary by deposit type, but most gaming companies pay high transaction fees across the board on all deposit types due to the “high-risk” categorization of the business.
At HorseTourneys, our blended deposit fees are well over four (4) percent on the amount deposited. Unlike other horse racing sites (such as ADWs) and most other online gaming sites, we do not charge this percentage to the customer and instead, absorb it into our expense structure. That we do not charge these fees is an immediate and significant benefit to the HorseTourneys player.
Some people ask, “why can’t you simply refund the deposit?” Believe it or not, even if we refund a player’s deposit, we don’t get the fees we’ve paid on those funds back. Those are kept by the bank and processor (including PayPal), primarily as a means to discourage refunds. So simply refunding your card or PayPal is not a solution to the problem.
The overall profit margin after track commissions and operating expenses of HorseTourneys is very small, and deposit fees themselves are far greater than that profit margin. Therefore, from a financial standpoint, it’s simply untenable for us to allow players full refunds of amounts deposited due to common circumstances such as a contest not filling. Tournaments are unique in this way–there’s always the chance that an event may not fill to the parameters needed to run. This is a reality that tournament players must come to accept.
(2) It’s against Anti-Money Laundering Policies of regulators, banks and payment processors
The practice of allowing someone to deposit money into a business, and then pull that same money out, is practically the definition of money laundering. If this practice were allowed, criminal types could launder money through online gaming operations with abandon.
This exact practice is expressly prohibited in contracts we sign with banks, as well as against regulations of horse racing and gaming regulatory commissions. This is something that is actually examined by auditors of HorseTourneys and gaming companies like it. Literally, if we do that, we risk our gaming licenses and the ability to ultimately serve our customers.
(Less Importantly) (3) It would be a logistical nightmare
Even if we could refund players without financial impact and without regulatory hurdles, it would be a complete mess to do so. For example, consider if a major track cancels a racecard. We could literally be staring at hundreds of refund requests. It’s simply not reasonable for such accounting staff time to be dedicated to processing refunds and withdrawals due to common circumstances such as those.
At the end of the day, due to the realities of payment processing and regulations in the online gaming space, players must agree to ultimately play any funds that have been deposited. This policy is steadfast and without exception for both longtime players and newcomers alike.
