I recently discovered this story by accident and thought it worth sharing. It revolves around a man named Mr W Gannon, a horse named Arsenal and the 1886 Melbourne Cup.
In the previous years Cup, won by Sheet Anchor, Arsenal was backed to win a fortune by his then owner. Unfortunately Arsenal ran awful and the plunge went astray. Furious, the owner refused to give the horse another chance and sold him immediately. Mr Gannon bought the horse for the princely sum of 375 guineas.
Arsenal was well fancied by Mr Gannon for the 1886 Cup, and the odds were quite lucrative. Determined to secure as much of the good odds he could get he sent a commission Agent out to back the horse for him. Inexplicably, instead of quietly going about the business of backing the horse, the agent let another big betting owner(who we will call Mr B) in on the secret. The big odds were duly snapped up, but by Mr B, getting in before Mr Gannon and securing much better odds. Mr Gannon found out and was naturally furious, and determined to get even with Mr B.
Just days before the Cup, Mr Gannon was staying at the Menzies Hotel in Melbourne, as was Mr B.(They were actually friends) One evening at dinner, Mr Gannon received a Telegram. On reading it he immediately rose to his feet, roaring with rage! Mr B asked if there was a problem with the horse, to which Mr Gannon showed him the Telegram. It was from Arsenal's trainer, Henry Raynor. It stated Arsenal had gone bad and was in doubt to run in the Cup. Mr B thanked Mr Gannon for showing him the Telegram and intimated he would immediately start laying off the bulk of the money he had invested before the word got out about Arsenal going bad. So Mr B arranged for another Commission Agent to start laying off(effectively selling his bets). As fast as the money was laid off, another well known Commission Agent was taking up the wagers. Mr B knew this man and wanting to warn him, asked him if he was betting for himself or for someone else, telling him if it was for himself, he should leave off as the horse was a "Dead un". The agent, unaware of the Telegram told Mr B he was in fact betting for Mr Gannon!! Immediately Mr B smelt a rat, and told his agent to stop laying off. "I can't, I've already laid it all off" was the agents reply. "And Gannon's got it all" was all Mr B could say in disbelief.
Mr Gannon had made up the whole Telegram in order to sting his friend and reclaim his rightful odds.
After a few nervous days, when the horse actually did go off his feed, Arsenal recovered and went on to win the Cup at odds of 20/1.