Billy Walters, the legendary sports bettor from Las Vegas, got sentenced to 5 years in prison for an insider trading scheme. Walters also has to pay a $10 million fine. The Federal Government said the 71-year old pro gambler pocketed over $32 million in profits from illegal stock tips in a scheme that also included pro golfer Phil Mickelson. Walters also avoided over $11 million in losses due to insider tips as well. In all, the U.S. Government said Walters stacked the deck in his favor to the tune of $43 million.
If the thunder don't get ya, the lightning will. The Man finally caught Billy Walters. The most-successful sports bettor in America got busted by the Feds, but not for sports betting... rather for insider trading. Walters got convicted last April, but he was not given a sentence until a couple of days ago. Legal pundits thought Walters might get as many as 8 to 10 years, but the judge only gave him a 5-year sentence. That still seems extreme considering Walters in 71-years old and he did not commit a violent crime.
The Walters' inside trading story reminds me of how the U.S. Government could not take down notorious gangster Al Capone, until Elliot Ness and company figured out a way to get Capone for tax evasion. The Feds were unable to touch Walters for any vagaries surrounding his sports betting, since he resided in Nevada where sports betting is legal. Walters is a legend in the gambling world, where he's become known as the greatest sports bettor of all time, while running one of the most powerful betting syndicates in the world. However, the Feds dug deep into Walters' involvement in a trading scheme for Dean Foods that also involved pro golfer Phil Mickelson. Dean Foods is a milk processor based out of Dallas. According to court documents, in 2012 Walters tipped off Mickelson on the stock, and the pro golfer made a quick $1 million profit. Mickelson then transferred the stock profits to Walters to cover a previous gambling debt.
In April of this year, Walters lost the largest wager of his life when he lost a three-week trial in federal court. Walters was found guilty of 10 counts including securities fraud, conspiracy, and wire fraud. Walters also has to pay a $10 million fine.
According to an article at CNBC...
"From 2008 to 2014, prosecutors argued that Walters made $32 million in profit and avoided another $11 million in losses. Walters stood accused of trading on insider information on Dean Foods Co., which he obtained from former company chairman Thomas Davis. Walters' maneuvers also involved a stock tip to Phil Mickelson, a star golfer, and Carl Icahn. The prosecution said Mickelson made nearly $1 million after Walters advised him in 2012 to buy stock in Dean Foods. Neither Mickelson nor Icahn were charged with wrongdoing. Mickelson didn't testify during the trial, but the prosecution did rely on testimony from Davis."
Yup, both Icahn and Mickelson walked, while Walters got sent up the river. Why were the Feds interested in Walters? A lot of members of the gambling community point to this long-from interview Walters did with CBS News and the popular program 60 Minutes. To this day, I'm baffled that Walters exposed so much of his Vegas betting operation. And I'm even more amazed he brashly called out Wall Street banksters in the interview. It's fairly obvious now, six years later, that the CBS interview caused way more harm than good.
Watch the CBS/Billy Walters interview here...