Walters’ win streak ends with conviction
Billy Walters made a fortune wagering on sports. He wasn’t as good betting on an insider-trading jury.
Walters was convicted Friday in the highest- profile — and most colourful — insider- trading trial in years. Testimony featured golfer Phil Mickelson and billionaire investor Carl Icahn, as well as a seamy world of gambling debts, stock tips delivered on burner phones and charity money used for prostitutes.
“If I would have made a bet, I would have lost,” Walters told reporters as he left court. “I just did lose the biggest bet of my life. Frankly I’m in shock.”
“To say I was surprised would be the biggest understatement of my life,” he added.
The verdict was delivered as Mickelson started secondround play at the Masters — the first major professional golf tournament of the year — in Augusta, Ga.
Walters had bragged that he never had a losing year in his career wagering on football and basketball. But he faced the longest of odds in taking on the Justice Department, which wins almost 95 per cent of its cases.
Now — after a four- week tr i al — t he 70- year- old Las Vegas gambler faces a lengthy prison term. The maximum sentence on the most serious charge is 20 years. The jury found him guilty of all 10 counts of fraud and conspiracy after about 5 1/2 hours of deliberations.
“Billy Walters lost his bet that he could cheat the securities market on a massive scale,” acting Manhattan U. S. Attorney, Joon H. Kim, said in a statement. “Walters underestimated law enforcement’s resolve to pursue and catch those who cheat the market.”
Barry Berke, Walters’s lawyer, said he will appeal. Unless he’s successful, Walters will be forced to walk away from Las Vegas businesses that i nclude golf courses, auto dealerships and car-rental agencies, with total revenue of US$ 500 million in 2013, according to testimony from his company’s controller. Walters, who didn’t testify at the trial in Manhattan federal court, has said he owns seven homes and a US$20-million jet.
Walters was placed under house arrest until his sentencing, which is scheduled for July 14. He was barred from flying on his plane.
For prosecutors, the verdict is a dramatic comeback after recent defeats in a lengthy insider- trading crackdown.
The verdict “shows how aggressive the government is going to continue to be with insider trading,” said Peter Henning, a law professor at Wayne State University in Detroit and former prosecutor.
“The appeals court ruling did not have the kind of debilitating effect that the U. S. Attorney’s office claimed it would have,” Henning explained.