It sounds as though he made the bet with the cop, and raised the stakes of his own accord. We can't put the idea in their head, but as long as they want to keep upping the ante, it's all fair.
As for the SWAT team... we don't know the full circumstances behind that raid... it could be that there were weapons involved on his end, it could be that the officer became overzealous and shot too soon. Without hearing an AAR, it's not my place to deconstruct with a citation.