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The White Whale

Billy Walters

The law has pursued sports bettor Billy Walters for more than 25 years. Is the gambler's uncanny luck about to run out?

IN HIS DARK SLACKS and a red golf shirt, Billy Walters looked like he might have just finished a round at his flashy Bali Hai course on the south Strip. But he wasn’t strolling toward the clubhouse on May 19. He was seated, under arrest, amid a row of less impeccably dressed defendants, all waiting their turn to hear their charges read in U.S. Magistrate Judge George Foley Jr.’s packed courtroom. The confidence and color drained from his face, his white hair disheveled, Walters appeared to have taken a punch in the stomach. It was a pain in the gut he’d felt before.

Walters appeared almost lost as his friend and longtime defense attorney Richard Wright stood nearby. Walters couldn’t be blamed for feeling a sense of déjà vu, as he had faced plenty of previous charges in his life. But those had all stemmed from his uncanny success as a professional sports bettor, and he had beaten every one of them while gleefully embarrassing his enemies in the process.

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This time, it’s different. Walters is accused of cheating in America’s biggest league of gambling — Wall Street. In a case brought by Preet Bharara, the U.S. attorney for the Southern District of New York, Walters is charged with insider trading violations in connection with the alleged manipulation of stock in Dallas-based Dean Foods. Also charged is Dean Foods board member Thomas C. Davis, who pleaded guilty to 12 felonies and has agreed to cooperate with federal authorities.

Charges against Walters include securities fraud, conspiracy to commit wire fraud, and wire fraud. He faces the prospect of millions in forfeiture and seized assets, and has also been hit with civil sanctions by the Securities and Exchange Commission. In June, Walters pleaded not guilty to the 10 felony counts against him. Golfer Phil Mickelson, a high-profile inside player in the alleged scheme, escaped indictment in the criminal case, but was fined more than $1 million by the SEC based on ill-gotten profits he made trading on stock after receiving insider tips from Walters. One of the world’s greatest golfers, Mickelson became heavily indebted to Walters in the scheme, according to authorities.

Wright, who walked into the Lloyd D. George U.S. Courthouse that spring 2016 afternoon with a $100,000 check to free Walters from custody, listened as Magistrate Foley explained the process. In a matter of legal formality, Walters gained an expedited release from custody and left the courthouse through a side gate — away from public scrutiny — within a few hours.

“Those who know me best know that it is preposterous to think that I would involve myself in insider trading,” Walters told the press the previous year when the criminal allegations first surfaced. But those who have followed his career know he has made millions of dollars with incredibly accurate information while rising in stature as an uncommonly prescient political insider. Local professional gamblers speak with affection and admiration about Walters’ relentless pursuit of the “best of it” — that is, the smart bettor’s inside edge that comes from information, insight and experience. But when it comes to Wall Street, an inside edge can come dangerously close to insider trading.

Local and federal law enforcement agents were also in court that day. Some were merely curious, while others had been examining Walters’ proximity to lucrative business deals with local government officials. Some had participated in his arrest at the fusion-fare Cili restaurant he owns at Bail Hai, known for its power lunches and “discreet wait staff.” In their world, Walters’ uncanny success in gambling and business was similar to the story arc of now-fallen powerhouse lobbyist Harvey Whittemore, who was convicted in 2014 on federal campaign contribution violations, but was suspected of facilitating much deeper corruption.

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To police and federal agents, Walters has been a white whale for more than 25 years. They’ve pursued him from the sprawling Computer Group case of the early 1990s that ended without convictions, through multiple raids of his sports betting network that resulted in money laundering indictments later dismissed, and even through ethically questionable golf course development deals with local governments that made elected officials and taxpayers look like carnival suckers. Each time, he swam away.

What they believed in their souls about Billy Walters, and what they were able to prove, were two different things. Will this insider trading case be any different? Given how the consummately savvy Walter has employed his renowned gambler’s instincts to save his skin as often as he’s used them to win big, it’s a question as complex as the man himself.


Win some, lose some, drink some

William Thurman Walters learned about life and long odds as a boy in Munfordville, Kentucky. Set in the south central part of the state on the Green River, Munfordville is the hometown of Civil War generals from the Union and the Confederacy. In the 70 years since Walters’ birth in 1946, its population doubled to 1,640 souls. These days, Walters is the town’s best-known native son.

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It was a long road from poverty to legend for Walters. In Munfordville, he was just another toddler from a broken home. His father was a gambler who died when “Billy” was 18 months old. His mother was a hard drinker who shuffled her son off to his grandmother’s house, a place without indoor plumbing. Poor but proud, Miss Lucy Queensburry kept a roof over their heads by cooking and cleaning for others. Walters found sanctuary and education at his uncle’s pool hall, where he hung out while his grandmother worked. He shot his first game of nine-ball standing on a Coca-Cola crate. He racked balls for change, learned to tell the sharps from the suckers and became fluent in the ruthless math and foreign language of gambling. The pool hall is where he learned to win and lose, pay and take, weigh the odds and get the best of it. He won some, lost some and drank some.

“More skullduggery goes on in a pool room than anywhere,” he once told interviewer Richard Munchkin. “It’s the greatest place in the world to learn what life is all about.”

With his winnings, he started betting on ballgames. It would be the Brooklyn Dodgers — and a local grocer named Woody Branstedder — who first broke his heart. Walters was a diehard New York Yankees fan in 1955, when names like Mantle, Berra and Whitey Ford were synonymous with victory. He bet his bankroll on the Yankees when they squared off with the underdog Brooklyn Dodgers in the 1955 World Series, and lost it all when the Dodgers won in seven games.

“I remember it like it was yesterday; that sick empty feeling I had the first time I got broke,” Walters said in Munchkin’s 2002 book, Gambling Wizards. “Whether you’ve got $75 or $75 million, if you lose all you’ve got, it’s pretty traumatic,” he later told The Wall Street Journal.

Despite his loss, he kept on playing. When his girlfriend became pregnant at 16, they married and had a medically fragile infant son. Walters worked in a bakery in the morning and a service station at night. He gambled every chance he got, and the local bookmakers who drove the nicest cars in town caught his eye.

By his late teens, Walters was hustling sales at a used-car lot and duffers at local golf courses. Both required the same skill: the ability to discern people’s desires, capacities and price points. While his rivals were reading greens, he was reading his opponents. A guy who shot par golf for a $100 Nassau bet might have a much tighter collar at $1,000. As Walters’ marriage disintegrated, his golf game improved. All the while, his circle of friends and associates grew more intriguing.

He built an early and abiding friendship with legendary Kentucky bookmaker Luther James, whom law enforcement authorities considered a “non-member associate of organized crime.” James and his friend Paul Hornung, of Green Bay Packers fame, later partnered in a Las Vegas casino junket office.

If Walters had stuck with car sales and avoided bookmaking, he might not be facing criminal charges today.

“If I had stayed focused on cars, and hadn’t gambled, I would probably own three hundred automobile dealerships today,” he told Munchkin. “But I didn’t. My love, my heart, my mind were always on gambling.”

Since his arrest, in the few interviews he’s granted (he declined through an attorney to speak for this article), his narrative with the media has evolved. In the past, he insulted the intelligence of prosecutors and federal investigators. Now he downplays his six decades of gambling and inflates his automobile sales success. “Walters: Done gambling, still dealing,” was the headline on a recent article in Automotive News. In it, the legendary sports gambler muses about auto sales being his saving grace, a claim that writer Jamie LaReau notes without irony.

“Whatever success I’ve had in my life I owe to the automobile business,” Walters said. “It was my MBA. It was my college. You strictly reap what you sow. ... You take a guy who comes from where I came from — if it wasn’t for the automobile business, I don’t know where I’d be today.” He is reportedly a partner in 18 auto dealerships in California, Kentucky and Georgia. He also owns two Las Vegas golf courses, a Budget Car Rental franchise at the San Diego airport, restaurants, a casino in Latin America and commercial and residential real estate. Still, he seems to find time to place bets.


A love of the action

During the 1960s, Walters was a regular in Louisville gambling circles, and a love of the action led him to Las Vegas, where he gravitated toward the big cash games at Binion’s Horseshoe and elsewhere. In the early days, Walters boozed almost as hard as he played. As real gamblers know, alcohol and games of skill only mix well in the movies, and he gained a reputation as a sharp but undisciplined player with a tendency to chase his losses, go for broke — and get there. An older Walters looked back at the younger man he was and called that guy “an idiot” who would “flip a nickel for all the money I had. I wasn’t stupid,” he told Munchkin. “I looked for the best of it, but if I couldn’t get the best of it, I’d take the worst of it to get in action.”

Walters came to Las Vegas often, won big money in the casino and on the golf course at the Las Vegas Country Club, and sometimes returned home stone broke and in borrowed clothes. He once won $400,000 on a single hole and $1 million on a game, only to lose that bundle at a blackjack table before the night ended. He’s credited his success to quitting drinking, a better appreciation of the business and, especially, his marriage to wife Susan, whom he says has been his compass for four decades.

Once sober and settled, he experienced steady success at the highest levels. It was then he learned another lesson: The casinos that welcomed his action when he rode the roller coaster weren’t as welcoming when he began beating them. With the exception of his friend Jack Binion at the Horseshoe Club, Walters considered most casino bosses as rivals. “If you threaten to become a consistent winner,” he once said, “the casinos not only didn’t want your business, but they would go to great lengths to create problems for you.”

Back home in Kentucky, he had also created some problems for himself. He dodged stickups and threats from heisters and loan sharks, but when he was busted in the 1980s for illegal bookmaking, his livelihood and freedom were threatened. Decades later, Walters remains highly sensitive about his only conviction. Calling himself “a bookmaker without a license,” he is quick to remind skeptics that his conviction was for possession of gambling records, a misdemeanor, for which he paid a $1,000 fine and received six months probation.

Still, it spurred him to abandon Kentucky for Las Vegas at the auspicious moment when the sports betting world was about to explode.


Driven to win with data

In the sports betting world, Walters’ name is synonymous with the Computer Group betting case, but, actually, Michael Kent was the brain behind the system. A mathematician who helped develop the nation’s nuclear submarine technology, Kent was also a self-described “computer nerd” and softball player. His use of computer programs to determine the abilities of the teams in his softball league wound up turning sports betting on its head by creating a data-driven handicapping system that rated teams with greater depth and accuracy than the pros.

No winner goes unnoticed in Las Vegas for long, so Kent soon found himself meeting Dr. Ivan Mindlin, an orthopedic surgeon who had been a physician to celebrities but was better known around casinos as a heavy gambler. Kent partnered with Mindlin for the 1980 college and professional football seasons, and battered local and illegal bookies so successfully they needed help finding enough bookmakers to take their bets. Walters’ contacts came in handy.

In Las Vegas, they used organized crime associates Eddie DeLeo and Dominic Spinale, a reliable layoff gambler with his hometown mob family in Boston, the Angiulos. So when Mindlin used Spinale to open an account at the Stardust, according to case Special Agent Thomas Noble, it attracted FBI attention. The Computer Group was about to go public.

From Las Vegas to Tulsa, El Paso to Baltimore, Knoxville to Salt Lake City, the Computer Group had a network of agents and a gambling operation that was second to none. Early in the group’s existence, the nation’s network of street bookies seemed oblivious to the magnitude of their enterprise. The group netted $24 million in 1984. In a one-month period, the group wagered $12.6 million and netted $1.6 million.

By December 3, 1984, in response to a 45-page affidavit by the FBI, U.S. District Judge Lloyd D. George approved a wiretap in what authorities believed to be a massive bookmaking operation with ties to organized crime. But the affidavit described more evidence of sports betting than illegal bookmaking. Even though “Doc” Mindlin was considered the manager of the Computer Group, its indicted members were more Walters’ ilk, such as old-school street bookmakers William “Lefty” Neumeyer of Baltimore and James Proctor Hawkins of Las Vegas. Then there were the poker and sports hustlers such as Korean War bronze star-winner Dale Wheeler Conway of Salt Lake City. And Glen Walker, a former NBC Sports publicity man who followed the action to Las Vegas and became Walters’ trusted agent. Although Walters was a physical presence around local sports books in the group’s early days, by 1985 he’d become a phantom. Often felt, seldom seen.

And yet, even after conducting a 23-city raid and serving 45 search warrants in January 1985, in an investigation that eventually launched felony charges against 19 co-conspirators, the FBI’s rhetoric was confusing. Court documents referred to illegal bookmakers, but the actions described were essentially sports betting — which was not against the law. The group’s members were making bets, not taking them.

Soon, the press reported that the Mindlin-Walters concern also included as bettors some influential members of the Las Vegas community, including longtime real estate developer and Mindlin associate Irwin Molasky. Molasky was not indicted, but testified before a federal grand jury under a grant of immunity. Molasky wouldn’t be called to testify at trial, but as Sun columnist Jeff German wrote, “At the very least, the Gucci set should be buzzing at the (Las Vegas) Country Club for a while.”

Walters, meanwhile, was working all sides to his advantage. The most important legal turn came prior to trial when Walters met in private with federal Judge George — without the knowledge or presence of his attorney, self-described mob lawyer and future Las Vegas Mayor Oscar Goodman. There was a reason for Walters’ insistence on secrecy: He’d previously met clandestinely with the FBI and shared information he believed might help ensure that neither he nor his wife, Susan, would be indicted. In fact, Walters had engaged in back-channel talks with the FBI since early 1986, a year after nationwide search warrants were served and illegal bookmakers were thoroughly exposed. Characteristically, Walters tried to put himself and his wife in the best position possible — and to get a read on his opponent. Walters signed an agreement to speak, on condition that his attorney would not be notified, according to his FBI debriefing memo.

As Walters later described it in an interview, he was trying to keep from being indicted and was willing to provide the feds with names and anecdotes — most of which were already common knowledge in the street bookmaking fraternity, and which he did not consider particularly damaging. It would seem he was hustling the FBI agent.

On his way to prying a recusal from Judge George, Walters’ estranged attorney Goodman filed a Notice of Outrage with the court on February 14, 1990. “A sordid history is being created in this case,” Goodman wrote, adding that, “No wonder, with a storm trooper mind set such as this, the ‘war on drugs’ is being lost, Shame – Shame – Shame.”

His entreaties had the desired effect, and Walters’ gambit turned the case in his favor. On July 26, 1991, Judge George wrote that although he believed the defense had presented “absolutely no evidence of bias, prejudice or impropriety,” he would recuse himself. His replacement, U.S. District Judge Clarence Newcomer of Pennsylvania, made it clear from the outset that he wasn’t excited about the government throwing the book at a bunch of sports bettors, no matter how high their profile or the size of their bankrolls.

After a two-week trial, jurors were hung on several conspiracy and illegal transmission of wagering-information charges, and voted to acquit on the rest. Only the handful who had taken a plea deal were convicted. Walters and his co-defendants walked away free from the nearly decade-long investigation.

Lost in the media postmortem on the trial was the fact that the FBI’s investigation was continuing, and was turning up the heat on Boston’s Angiulo mob family using evidence gathered during the Computer Group investigation.

“Nobody had ever seen anything like this before,” now-retired FBI agent Noble says. “This was not a gambling case. It was never about a gambling case. It was an organized-crime case. This started with Dominic Spinale, a Boston LCN associate, and from there reached out to organized crime bookmakers. That was the genesis of the thing. It wasn’t a gambling case at all. The Computer part of the case was spun off.”


Courting controversy, creating enemies

The Computer Group investigation aside, Walters had gained a reputation as a formidable high-stakes gambler in several areas. His success on the golf course in big-money private games was curious. In 1986, he won Amarillo Slim’s Super Bowl of Poker, then the game’s second-largest tournament. He courted controversy and created a powerful enemy when he won a reported $3.8 million in one day at roulette at the Atlantic City Golden Nugget. He was suspected of cheating, and casino owner Steve Wynn reportedly hired NASA-trained engineers in an unsuccessful attempt to find the flaw in the wheel. Walters maintained that he merely found a mathematical edge and exploited it.

He also played pool, his childhood favorite, for enough money to buy a mansion, occasionally beating mob-connected players and risking being roughed up as a consequence. He remained tough to beat at any game.

But law enforcement was never far behind. By 1996, Walters was making the wrong kind of headlines again. Nevada state authorities and Las Vegas Metro detectives raided Walters’ Sierra Sports Consulting and seized $2.8 million. Indictments alleged money laundering. Walters called it an old-fashioned shakedown, claiming he had been offered a chance to buy his way out of the legal entanglement if he gave up $500,000. He said he refused out of principle. His improbable success gambling on games that seemed to bust out just about everyone else enhanced his reputation. The New York Times fueled the magic in a 1998 story, noting how Walters had risen from humble Kentucky roots as a “small-time gambler and used-car salesman.” As long as the Horatio Alger story sparkled in the national profiles, he welcomed the exposure. Thanks in part to prosecutorial fumbling and sloppy investigative work, he’d eventually win dismissals of the 1996 indictments at the local and state levels.

Still, the case revealed much, both about the inner workings of Sierra Sports Consulting and of Walters’ mind. When messenger betting — that is, having a proxy place bets for you — was outlawed, Walters showed his ingenuity by creating a corporation, Sierra Sports Consulting, and bringing in his associates as partners.

“Everyone owned 1 percent of the company,” a former Walters runner explains. Like several interviewed for this article, he speaks with affection and admiration for Walters, but still requested anonymity. “When you first meet him, you sign a partnership form and you are brought on as a stock shareholder” in a corporation.

A runner’s job was to “fill orders,” the former employee says. “You were told what to do and where you were to go to handle it.” When, inevitably, a runner’s bankroll grew into the high six figures, to avoid a potential robbery, the cash and chips were placed in a casino safety deposit box. “Instead of walking around with over a million dollars, you turned it in. The rules were put in place for good reason, obviously.” The runners were essential to the process, but they weren’t necessarily in on the betting strategy. Sometimes they were decoys sent to move opinions and betting lines. Other times, they were the hitters who collected major wins.

“What I experienced was a sense of loyalty,” the former runner says. “With Billy, it was all about loyalty. As long as you’re loyal to him, he’ll always be loyal to you.” The last time they spoke on the phone, the former employee says, Walters started the conversation by asking about the runner’s son, now a young man. The former boss clearly understood what was most important in his ex-employee’s life. “That is the kind of person he is. He brings himself down to our level, so we feel comfortable talking to him. ... I can’t call him a father figure, but I always look at Billy as someone to turn to, someone I trust for advice.”

Michael Konik may have been the least likely runner under Walters’ employ. The author, journalist and screenwriter played the role of the high-rolling sports bettor for a couple years in the organization. He made a bundle with the group while gathering material for a nonfiction book, The Smart Money: How the World’s Best Sports Bettors Beat the Bookmakers out of Millions. Walters’ name is changed in the book to Rick “Big Daddy” Mathews, and The Computer Group is called The Brain Trust. But the anecdotes are straight out of a day in the life of one of the most successful sports betting concerns in the world. Perhaps reflecting the sense of loyalty Walters inspired, Konik is reluctant to pull back the curtain on Walters’ world.

“To call him a living legend is no exaggeration,” Konik says in a statement. “Any serious sports bettor knows who he is — and they’d like to know which teams he’s backing.”


‘He’s a formidable opponent’

Some local sports book operators welcomed Walters’ business in order to get early access to his plays — a strategy with decidedly mixed results. Walters’ appearance on 60 Minutes with a fawning M Resort executive, Lee Amaitis, in a puff piece reported by CBS correspondent Lara Logan, motivated Nevada gaming regulators, as well as FBI and IRS agents, to open a criminal investigation of the man who disarmingly calls himself a “Kentucky hillbilly.” Soon after the episode aired in early 2011, the M sports book was engulfed in a scandal linked to Walters’ old Computer Group associate, Stanley Tomchin.

Walters’ Kentucky drawl and country boy charisma didn’t work on Art Manteris; he doesn’t buy the line that linking arms with Walters is good for a bookmaker’s business. Manteris, a 40-year sports book veteran, stopped taking Walters’ bets early in their acquaintanceship. Manteris and several other Vegas bookmakers privately refer to Walters as “Satan” or “The Great White.”

Some bookmakers look like geniuses when they let Walters bet, but his bets can also kill the bottom line. Associating too closely with him has cost many people their jobs, and concerns about Walters in the sports book world have bordered on paranoia. “Billy Walters is in the house!” shouted one sports book supervisor when a suspected Walters messenger entered the establishment.

Manteris, now an executive at Red Rock Resorts, hasn’t spoken to Walters for many years. In a recent interview, he was circumspect and judicious in his remarks about the man whom others have dubbed the Keyser Söze of Las Vegas.

“From what I know, he really was the most successful and toughest sports gambler in American history,” Manteris says. “I think that he combined great gambling instincts and gambling intelligence with technical capabilities. By introducing sports data analysis to sports handicapping, it put him so far ahead of the curve that it was just ridiculous. I don’t think there’s any doubt that he’s a very smart fellow and a very smart gambler.” But Manteris remains uninterested in taking big bets from a Walters concern. “He’s a formidable opponent,” Manteris says. “I’m very respectful of his abilities. I’m envious, I firmly acknowledge that. Does that make him a good customer in my book? No. Not at all.”

Walters has engendered affection, and even awe, from some sports book industry analysts and handicappers, for whom a winning bottom line equals respect and admiration. That Walters’ choreographed use of “beards” to mask his placing of large bets — and then making sizable misdirection wagers to move the line to a more favorable number before dropping an even larger bet — apparently doesn’t faze them. “He is the most respected sports bettor in the world,” enthused popular sports tout R.J. Bell to The Wall Street Journal.

In past interviews, Walters and his associates have described the practice in benign terms, or in the language of Wall Street, but his success motivated the gaming industry to push through legislation outlawing messenger betting. That legislative action complicated Walters’ betting strategy, but it didn’t slow his success. A 2008 controversy drew attention to him when he teamed with professional Fredrik Jacobson to win a pro-am golf tournament at Pebble Beach. Then again in 2010, when he admitted having approximately $2 million on the line every Sunday during the NFL season, and then $3.5 million on that year’s Super Bowl alone.


A patron saint moved to tears

With his millions in winnings have come the familiar trappings: an expensive jet, multiple mansions and foreign business interests. But, like many high-profile wealthy characters, Walters’ philanthropic gestures are laudable. He may have bedeviled law enforcement, rocked to sleep members of the Las Vegas City Council and Clark County Commission in golf course land deals and been a satanic phantom in Las Vegas sports books, but he is an indefatigable patron saint of the Opportunity Village, which aids mentally challenged adults and their families. Walters’ connection to the charity is personal as well as monetary. His 47-year-old son, Scott, who survived brain cancer and surgery but was left with severe cognitive challenges, has been a presence at the site for many years.

Opportunity Village executives are generous in their defense and support of Walters following his indictment. “God bless Billy Walters and his family,” says Executive Director Bob Brown, the former Las Vegas Review- Journal publisher. “I think the world of them. I don’t understand what he’s going through, but I can tell you he’s been an incredibly generous friend to this organization.”

More than two decades ago, the organization’s founder placed a cold call to Walters without knowing of his son’s challenges. In that single conversation, Walters was moved to tears by the charity’s mission and its alignment with his own life.

His contribution of $10 million to the charity has also served to soften his reputation as a controversial gambler and well-connected developer. Most members of the Las Vegas City Council and Clark County Commission have been deferential toward him, even though his golf course deals — such as Royal Links, which he purchased for a relative pittance — generate large profits while returning little to the public coffers, and have exposed at least one top city official in an alleged ethics violation. When Walters in 1999 paid just $894,000 to lease a large swath of public land located near a sewer treatment plant for future use as a golf course, the city signed off. After all, what else could be built near such a malodorous spot?

The Royal Links Golf Course was handsome, if not exactly fragrant. But by 2005, Walters was back, pressing to have the lease opened and the zoning restrictions removed in exchange for $7.2 million. Administrative staff balked. Costs to improve the air quality alone might cost as much as $100 million. Walters prevailed in a score that overshadowed his biggest sports bets. Land appraised at $5,600 per acre in 1999 was suddenly worth $400,000 per acre.

When Attorney General George Chanos found Walters was on the receiving end of a “consistent pattern of political and financial” patronage, which compelled the city to blush and rescind, he was widely criticized. A Metro investigation later determined then Las Vegas Public Works Director Richard Goecke had likely committed a criminal act as part of that patronage, but no one was ever charged. Walters denied wrongdoing, was lauded by city leaders as “smart” and a “good negotiator” and kept moving.

He may be a mythological figure in the sports book and halls of local government, but in the realm of local golf course development, his feet have been all clay. Despite getting all the best of it from public officials and financial set-asides galore, in addition to the mess at Royal Links, his Stallion Mountain fell into decay that generated lawsuits, Desert Pines was dumped during the recession and Bali Hai has underperformed badly on paper. Walters’ legal representatives have blamed the recession, but longtime observers of the gambler suspect the highly confident Vegas insider failed to spot a troubled economy. As his attorney Dennis Kennedy recalled in the Stallion Mountain litigation, “In 2006, and this is no secret to anybody, the economy starts to go downhill. The good times are starting to come to an end.”

Where some see the shadows of public corruption and slippery ethics, others consider Walters simply an expert at playing politics in Nevada, where checkbook generosity and in-kind contributions have often led to a high winning percentage for developers in front of local government. In that realm, as in betting, Walters has been all but unbeatable.

For every critic, there’s a current or former elected official singing Walters’ praises. Former Mayor Oscar Goodman had apparently recovered from whatever bitterness he felt during the Computer Group days, and gladly accepted his political contributions. One notable fundraiser for Goodman held at Cili raised six figures for his candidacy. “He’s a sly fox, but I’d rather have him in my hen house than anybody else,” Goodman says. “His word is good. If he tells you he’s going to do something, he does it. He’s always been 100 percent with me. He’s been as honorable as any guy I’ve ever dealt with.”

Where repeated controversy has made others radioactive, Walters continues to enjoy access to the city’s elite social and business circles. When he was honored as the Opportunity Village Philanthropist of the Year in 1997, such dignitaries as U.S. Senator Harry Reid and Governor Bob Miller were on hand. His rise from Southern poverty is undeniable, his successful operation of multiple companies impressive. And his multimillion-dollar embrace of Opportunity Village transcends a public relations ploy.


Changing stakes, changing game

But that’s not what brings the FBI to your door. The 40-page criminal indictment against Walters alleges that from 2008 to 2014, he received confidential “material, nonpublic information” about the finances of Dean Foods from company executive Davis, who was not only his friend and business partner, but also indebted to Walters in the amount of $1 million. With the insider information Davis provided him, according to the allegations in the indictment, Walters made a killing: approximately $32 million in profits while avoiding $11 million in losses.

The charges, which will be decided by a federal jury in New York, include the allegation that Walters issued Davis a prepaid cell phone for exclusive use to communicate the insider information. Like the illegal bookmakers of days past, he instructed Davis to use code words to mask the content of their conversations. “Dallas Cowboys” was the alias for “Dean Foods.”

Mickelson, the three-time Masters winner, shared something in common with Davis, according to the indictment. He also found himself in debt to Walters, who’s alleged to have passed along insider information to Mickelson that enabled the legendary golfer to make a million-dollar score.

In New York, Walters’ bond was set at an iceberg-cool $25 million. With a net worth publicly estimated at $100 million, and friends worth many times that, he covered that number, too. Barry Berke, Walters’ New York attorney, called his client “a true American success story” whose sports gambling career was “lawful” and made him “widely recognized and lauded.” Berke claimed the charges were based on “erroneous assumptions, speculative theories and false finger-pointing.” In contrast, Davis’s attorney seemed eager to have his client cooperate fully in the investigation. Mickelson’s lawyers, too, were sanguine at the prospect of their clients’ status. “Phil was an innocent bystander to alleged wrongdoing by others that he was unaware of. Phil is innocent of any wrongdoing.”

Such rhetoric raises the question: If Davis is repentant and Mickelson is innocent, what does that make Walters? A man who tried to hustle Wall Street, the most rigged game in America? If Walters has outfoxed legal and illegal sports books across the nation for decades, causing sleepless nights for a handful of casino bosses, is that really such a crime? How has a fellow with a poor boy’s education finagled deal after deal from government institutions armed with lawyers, accountants and experts of every stripe?

Maybe the answer can be found in remarks made by FBI agent Noble about Walters’ extraordinary ability to “smooth over” issues and “move people where he needs them to be. ... He’s good at working people.” Walters’ understanding of human nature, and the useful moral relativism that is an integral part of the Las Vegas psyche, may be the strongest parts of his game.

While others were learning to read books, that poolroom waif from Munfordville was reading green felt and his fellow man. Perhaps after all these years, only the stakes have changed. Maybe this time, the government finally has its man. Maybe this time, Walters will be willing to trade something truly valuable in exchange for his freedom. But even the best sports book experts won’t handicap the outcome of this case.   

A longtime Las Vegas journalist, John L. Smith is the author of more than a dozen books. He was inducted into the Nevada Press Association Hall of Fame in September.

CORRECTION Nov. 2 2016: This story has been corrected to reflect that Dean Foods is not the owner of the Olive Garden restaurant chain.