Gambling legend Billy Walters blames Phil Mickelson for his 5-year prison sentence
Golf Culture

Gambling legend Billy Walters blames Phil Mickelson for his 5-year prison sentence

Billy Walters was a friend and golf buddy to Phil Mickelson.

Billy Walters is in a minimum-security federal prison, serving a 5-year sentence for insider trading. Walters was sentenced in July 2017, and he reported to the Florida facility in October.

He's laying low while he appeals the conviction in theĀ U.S. Court of Appeals Second Circuit, but he spoke to ESPN before heading into prison about his case. In the conversation, Walters, 71, threw former golf buddy and friend Phil Mickelson under the bus and claimed the five-time major winner not testifying in open court on his behalf is a big reason why he was convicted.

Mickelson owed Walters $2 million in gambling debts back in 2012, and so Walters shared an inside tip he had on Dean Foods to make some of the money quickly on the stock market. Mickelson made nearly $1 million on a big trade, and he paid the money directly to Walters. That came midway through Walters' run from 2008-15 of trading the stock on insider information, making in upwards of $43 million over the period.

When Walters was arrested on charges of insider trading, Mickelson was identified in a Securities and Exchange Commission non-criminal complaint, compelling Mickelson to pay back the ill-gotten gains as a fine. Mickelson complied. Mickelson was never charged with a crime, but he did twice tell FBI investigators he had no knowledge of insider information in making the trades. Mickelson never made those claims in court, however, with his lawyers suggesting the golfer would claim Fifth Amendment rights against self-incrimination were he called to testify at Walters' trial.

"Here is a guy that all he had to do was come forward and tell the truth," Walters said in the October interview. "That was all he had to do. The guy wouldn't do that because he was concerned about his image. He was concerned about his endorsements.

"My God, in the meantime a man's life is on the line. He's going to go to prison. And you got prosecutors up there during the entire trial, the entire month -- all they talked about over and over was me giving my friends insider information. That is all they talked about. And they knew those jurors were all up on the internet reading that stuff about Phil [profiting from the Dean Foods stock purchase]."

Mickelson was mentioned more than 120 times in the three-week trial. The text messages between Walters and Mickelson at the time were used to demonstrate the sharing of insider information to Mickelson from Walters, who had the info from Dean Foods chairman Thomas Davis, who was also convicted and sentenced to 2 years in a federal prison camp. Walters knew Dean Foods was about to announce both great quarterly results and a possible spin-off of the company which would send the stock soaring 40 percent.

On July 30, 2012, Mickelson purchased 4,140 shares of Dean Foods in two separate accounts. A day later, Mickelson invested $2.4 million in an additional 196,100 shares. He sold them on Aug. 1 for $930,000 in profit, which was turned over to Walters. Walters didn't unload his stock in this case, and his lawyers argued in court he wouldn't tell Mickelson such information because it would be so obvious that Walters would easily be caught by the SEC.

Walters' appeal is expected to be heard in May.

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Ryan Ballengee

Ryan Ballengee is founder and editor of Golf News Net. He has been writing and broadcasting about golf for nearly 20 years. Ballengee lives in the Washington, D.C. area with his family. He is currently a +2.6 USGA handicap, and he has covered dozens of major championships and professional golf tournaments. He likes writing about golf and making it more accessible by answering the complex questions fans have about the pro game or who want to understand how to play golf better.

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