July 27, 2017 / 4:58 PM / 2 years ago

Las Vegas gambler Walters gets five years prison for insider trading

NEW YORK (Reuters) - Famed Las Vegas sports gambler William “Billy” Walters was sentenced on Thursday to five years in prison, following his April conviction in one of the highest profile U.S. insider trading trials in years.

FILE PHOTO: Professional sports gambler William "Billy" Walters departs Federal Court after a hearing in Manhattan, New York City, New York, U.S., July 29, 2016. REUTERS/Andrew Kelly/File Photo

Walters, 71, stood silently as U.S. District Judge Kevin Castel in Manhattan pronounced the sentence.

Federal prosecutors said Walters made more than $43 million in profits and avoided losses from 2008 to 2014 based on stock tips mainly about Dean Foods Co from Thomas Davis, a former chairman of the dairy processing company.

The case has drawn more attention because of Walters’ dealings with billionaire investor Carl Icahn and champion golfer Phil Mickelson.

Neither was charged with wrongdoing.

Castel called Walters’ crime “amateurishly simple,” and rejected a defense request for a 366-day prison term.

“Billy Walters is a cheater and a criminal, and not a very clever one,” Castel said. “At this point in life, money was a way of keeping score.”

Castel also imposed a $10 million fine and one year of supervised release, and will determine restitution and forfeiture later.

He rejected Walters’ bid to stay free on bail during his appeal, which his lawyer Barry Berke expects will address issues including grand jury testimony leaked by an FBI agent to journalists. Walters must surrender on Oct. 10.

Prosecutors said Davis would often use prepaid cellphones to provide tips, including one nicknamed the “Batphone,” and would often speak in code with Walters, as when Walters asked that he refer to Dallas-based Dean Foods as the “Dallas Cowboys.”

In seeking leniency, Berke cited the “incredible and remarkable” good deeds and philanthropy that have “defined Mr. Walters throughout his life,” as well as the defendant’s age and need to care for his mentally impaired adult son.

Federal prosecutor Brooke Cucinella countered that while the government was “incredibly sympathetic” toward Walters’ family, the defendant’s greed justified a stiff punishment.

“His conduct in this case was egregious,” she said.

Jurors on April 7 convicted Walters on 10 fraud and conspiracy counts, after less than a day of deliberations and a four-week trial.

It emerged in the case that Walters and Icahn talked often about investing, and Davis testified that Walters recommended to him one investment based on Icahn’s advice.

Mickelson, who once owed gambling debts to Walters, agreed in May 2016 to settle a Securities and Exchange Commission civil case by forfeiting $1.03 million he made based on a Walters tip.

Reporting by Jonathan Stempel in New York, editing by G Crosse

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