The History of Pari-Mutuel Betting: From Paris to the Track

Pari-mutuel betting, in which bettors stake against one another instead of against a bookmaker, took shape in Paris in the 1860s through a Catalan-born showman named Joseph Oller. Sources agree on the man and the city but not the year: dates from 1864 to about 1870 appear in print, and one encyclopedia calls him Pierre. The records do show a system that pooled every stake on a race, deducted a commission and paid the remainder to holders of winning tickets. It survived a court ruling in 1869, a conviction in the 1870s and a period of bookmaker rule before France gave it a legal footing by a law of June 2, 1891. A machine built by George Julius for Ellerslie racecourse in Auckland in 1913 later automated the arithmetic. This article follows the story from Paris to the American racetrack, through the laws that threatened it, and marks every point on which the sources disagree.

Betting on Racecourses Before the Tote

Horse racing became a popular public entertainment in 1860s Paris, with several racecourses around the city. According to a University of Auckland summary of Ferran Canyameres’s 1946 biography of Oller, wealthy bettors made direct person-to-person wagers, while smaller gamblers bought tickets in a blind pool. Each ticket was matched to a horse chosen at random, and the holder of the winning horse took the whole pool after a commission was deducted. Pools of this kind were close to lotteries, which French law prohibited.

A bookmaker works differently. As legal scholar Alex Gardner explains, a bookmaker sets the odds and those odds stay fixed, so bettor and bookmaker are in opposition: the bookmaker profits when the backed horse loses. In a pari-mutuel pool, by contrast, bettors compete among themselves and the organizer takes a set percentage and pays out the rest. The French term means roughly a bet among ourselves.

American newspapers of the 1870s taught readers the arithmetic with an example Gardner repeats. Six horses, A to F, draw 100 tickets at $5, a pool of $500. With a 10 percent commission, $450 remains for the winners. Ten tickets on horse A would each return $45, twenty on horse B $22.50 and twenty-five on horse C $18.

Joseph Oller and the Paris Mutuels

Joseph Oller was born on February 10, 1839, in Terrassa, Catalonia, and grew up in Paris after his family moved there. His biographer Canyameres, as summarized by the University of Auckland, says he is reputed to have conceived the system after watching disputed bets at cockfights in Bilbao, where his father had sent him at 17. That origin story rests on one biography and should be read as reputation, not record.

By 1865, the Auckland summary says, Oller had opened an office on the Boulevard Magenta selling pool tickets for 2 to 100 francs. On March 5, 1865, he took his operation by wagon to the racecourse at Champ de la Marche. Les Echos, drawing on Christophe Donner’s history, describes a canary-yellow mobile ticket office five meters high with eight windows.

The change came in 1867, according to the Encyclopedie Universalis and the Auckland summary. Oller dropped the random draw so that each bettor chose a horse, apparently because a pure game of chance was illegal in France. All stakes were totaled, winners shared the pool, and the firm took a commission, 10 percent in the Auckland account and reduced to 5 percent on days of heavy turnover. He traded as Paris Mutuels from the Boulevard des Italiens, and in 1868 patented a mechanical totaling counter.

Publicity helped. Gardner says the system was shown to an international audience at the 1867 Universal Exhibition in Paris, and that Oller advertised in London newspapers in 1870 for English customers. To attract bettors he also published a racing form magazine, which the Auckland summary names the Bulletin des Courses. By 1873, the same summary says, annual turnover reached 5 million francs, a sum that soon drew the attention of prosecutors.

Turning Points: Courts, a Law and a Machine

The first came on June 6, 1869, when the Cour de cassation separated the two systems. Chance-based pools fell under the lottery law of 1836 and were illegal, while pari-mutuel betting, where each bettor chose a horse, was not treated as a game of chance, according to the Encyclopedie Universalis.

In 1874 a public prosecutor charged Oller and 23 other agencies. Gardner reports that all were found guilty and that Oller received the largest fine, 5,000 francs. He closed the office and in 1875 opened a theater on the site, the start of his later career in entertainment.

Bookmakers filled the gap, and abuses followed. The Auckland summary says racing clubs were authorized to run hand-operated totalisators in 1887 and bookmaking was banned in 1890. The law of June 2, 1891 then placed pari-mutuel betting under the parent racing societies, the Racing Post reports, and Britannica says France established a national system that year.

The machine came from Australia. George Julius filed a totalisator patent in 1909, and his mechanical tote ran at Ellerslie’s Easter meeting on March 22 and 24, 1913. The New Zealand Herald reported £41,514 10s in investments on the meeting’s last day, March 24.

Aftermath: From Paris to the American Track

Gardner dates the arrival in America to the spring of 1872 at Jerome Park, New York, citing an 1877 Cincinnati Enquirer report. Within a few years pool-selling attracted allegations of fraud, and New York banned it in 1877. Alabama passed an anti-pool law in 1897 and San Francisco an ordinance in 1899.

Bookmakers then dominated until a Progressive-era backlash. According to the Kentucky Derby’s official history, Churchill Downs tried pari-mutuel machines in 1878, bookmaking arrived in 1882, and the machines returned for the 1908 Derby, won by Stone Street on May 5. A Churchill Downs official later interviewed Oller in Paris, and Gardner quotes him as saying “It is the only way to bet”.

New York took a harder path. Governor Charles Evans Hughes pushed the Hart-Agnew laws of 1908, which a 25-25 Senate tie defeated on April 8 and an extraordinary session then passed by one Senate vote. Racing stopped in 1911 and 1912, resumed on May 30, 1913 after courts held oral betting was not bookmaking, and pari-mutuel wagering began on April 15, 1940 at Jamaica, where 22,474 attended.

Myths, Disputes and the Other Side

The year is disputed. The French Ministry of Culture says 1864, Les Echos places the first wagon in 1865, Gardner says 1866, the Universalis and Circopedia say 1867, and Britannica says about 1870. Britannica also calls him Pierre, while the other sources name Joseph. The prison term is unsettled too: Circopedia says 15 days, the Auckland summary 18.

Figures differ on racetracks. Gardner reports that American tracks fell from 314 in 1897 to 43 in 1908, while Liebman gives 25 for 1908. Sources also disagree on Longchamp’s tote, dated 1927 by the University of Auckland and 1928 by Engineers Australia.

Pari-mutuel betting was no cure for gambling’s costs. Gardner describes 1870s accusations that pool operators bribed jockeys or shifted tickets to inflate a winner’s count, and pools on the 1876 presidential election, reported at $1 million to $3 million, were refunded after public pressure. England’s courts held it a game of chance, and it stayed illegal there until the Racecourse Betting Act of 1928.

Pari-Mutuel Timeline

Related Stories

Pari-mutuel betting is one thread in the longer story of wagering on sport. How a bet was priced changed again with the point spread, told in the history of the point spread, with its Chicago origins and the 1951 scandals. Because French law treated chance-based pools as lotteries, the history of lotteries supplies useful background. Paris was also the setting for the history of roulette, a game that reached Monte Carlo in 1863, and the damage fixed wagers can do is recorded in the 1919 Black Sox scandal. Each of these stories shows how gamblers, lawmakers and courts kept redrawing the line between a lottery, a game of skill and a bet.

Sources & References

• Alex Gardner — The History that Preceded Historical Gaming: How Parimutuel Wagering Won its Place in America, International Association of Gaming Advisors
• Bob Doran, University of Auckland — Joseph Oller, Inventor of the Pari Mutuel System of Wagering (summary of Ferran Canyameres, L’Homme de la belle epoque, 1946)
• Thierry Depaulis — Joseph Oller, Encyclopedie Universalis
• Sabine Delanglade — Comment le PMU a entame sa mue, Les Echos (2013)
• Scott Burton — Allez France, the Arc, the Quinte and Marie Myriam on Eurovision, Racing Post (2017)
• Circopedia — Nouveau Cirque (Paris)
• Encyclopaedia Britannica — Pari-mutuel
• French Ministry of Culture — Un homme de cirque et de jeux: Joseph Oller, Le cheval et ses patrimoines
• University of Auckland Computing History Displays — The First Automatic Totalisator
• Bob Doran — The First Automatic Totalisator, The Rutherford Journal (includes New Zealand Herald report of March 25, 1913)
• Engineers Australia — Julius Totalisator, Engineering Heritage nomination (2014)
• Bennett Liebman — The Past as Present: The Last Dead Heat in the State Senate, NYSBA Journal (January 2009)
• Bennett Liebman — 75 Years of Pari-Mutuel Wagering in New York, Government Law Center, Albany Law School (2015)
• Kentucky Derby — How Kentucky Derby betting traditions have changed over time since 1875 (2024)