The Las Vegas gambler who is currently being investigated by US authorities on insider trading allegations in 2011 and 2012, was said to have faced a multimillion-dollar debt to the government at that time.
According to court records, William "Billy" Walters owed as much as $15.25 million to the Federal Deposit Insurance Corp from the sale of the Stallion Mountain golf club in Las Vegas, which is owned by a company he owned. The buyers who bought the club in 2006 using a bank loan personally guaranteed by Walters, had defaulted in 2008. As the guarantor, the responsibility of paying off the loan naturally was now on the gambler by Community Bank of Nevada. FDIC had taken over the said bank later on, which means Walters' obligation was now with the agency.
FDIC spokesman Greg Hernandez said Walters settled his obligation with the agency after a judge ordered him to make a $11.2 million payment to settle the loan in 2012.
Bloomberg said that the liability showed a glimpse into the gambler's outflows at the time when suspicious stock-market trades had caught the attention of investigators. According to a person familiar with the matter, the Federal Bureau of Investigation in New York, the US Securities and Exchange Commission and Manhattan U.S. Attorney Preet Bharara are probing on the large option trades by Walters and golfer Phil Mickelson before billionaire activist investor Carl Icahn offered to buy Clorox Co in 2011 for $10.2 billion, as well as the trades done by Mickelson and Walters in Dean Foods Co. in 2012.
The person, who refused to be named as the matter is not yet public, said both Mickelson and Walters have traded in Clorox. The person added that investigators are looking into the possibility of Icahn sharing information on the Clorox buyout attempt with Walters, and of Walters sharing it with Mickelson before making the trades.
Although the three have not been accused of any wrongdoing, the 78-year-old Icahn said that he has never leaked confidential information nor spoke with Mickelson. The golfer has also denied allegations lodged against him.
