How did Billy Walters make millions? Did he come by his fortune legitimately? What secrets does he share in his autobiography?
Born into poverty, Billy Walters became one of the most successful sports bettors in US history, with a net worth north of $100 million. A 2023 inductee to the Circa Sports Betting Hall of Fame, Walters helped shape the modern sports betting landscape as well as the sports betting theory used by professionals.
Keep reading for an overview of Billy Walters’s Gambler: Secrets From a Life at Risk.
Overview of Billy Walters’s Gambler
Billy Walters’s Gambler: Secrets From a Life at Risk reveals the secrets behind his approach to sports betting, detailing how he created a betting operation that consistently profited millions of dollars annually in Las Vegas. Along the way, he details his own life story that saw a boy from rural Kentucky, struggling with gambling and alcohol addictions, become one of Las Vegas’s most notorious sports bettors.
In this overview, we’ll focus on four key components of Walters’s life. First, we’ll discuss his childhood and adolescence, explaining how he was exposed to both gambling and drinking from an early age in rural Kentucky. Next, we’ll examine his early adult years, which saw him divorced and remarried by the age of 21, leaving him working incessantly to support two children. Then, we’ll turn to Walters’s time in Las Vegas, exploring his association with sports betting syndicates and his founding of his own sports betting business that netted millions annually. Finally, we’ll examine Walters’s brushes with the law that culminated in his 2017 conviction for insider trading.
Walters’s Childhood and Adolescence
Growing up in small-town Kentucky, Walters’s childhood was marred by poverty and the absence of a father figure, as his own father died when he was 16 months old. We’ll delve deeper into Walters’s early life, exploring what his childhood looked like in rural Kentucky and how his adolescence shifted after he moved with his mother to Louisville.
Childhood in Rural Kentucky
Walters was born in 1946 and grew up in extreme poverty in rural Kentucky. According to Walters, he was regularly exposed to alcohol and gambling even as a child. That exposure, along with a family history of addiction, laid the foundation for his later alcoholism and gambling addiction.
Walters writes that a neighbor offered him moonshine—a strong, traditionally homemade liquor and a Kentucky staple—when he was only 10 years old. Around the same age, he began spending hours in local pool bars, where grown men regularly drank alongside him and his friends.
He adds that sports betting was a common pastime in these bars, so they marked his introduction to the gambling world. In one instance, Walters bet $125 on the New York Yankees to win the 1955 World Series; at the time, that $125 represented all the money he’d saved up from mowing lawns and other odd jobs around town. The Yankees lost, and therefore so did Walters.
Adolescence in Louisville
Walters says that he moved to Louisville, Kentucky at age 15 to live with his mother and remained there until he was 19. While in Louisville, his adolescence came to a quick end: He became a father at age 17, married his girlfriend Sharon, and worked two full-time jobs, all while successfully finishing high school.
After graduating from high school, Walters began blue-collar work at a metal factory to support his wife and their infant daughter. While there, he also leaned into gambling to earn additional income. He became a bookmaker (commonly called a “bookie”) and took bets from his coworkers on local horse races. He even offered small payday loans (typically $10) that allowed his coworkers to bet on credit, then pay him back with interest once they got their paychecks. Between this supplemental gambling income and a promotion at work, Walters was able to buy a house at the age of 19.
Divorce From Sharon and Marriage to Carol
Walters admits that he drank heavily to cope with the stress of supporting a family at such a young age. Moreover, his gambling began to spiral out of control, and he lost tens of thousands of dollars playing craps and pool at local bars.
Ultimately, Walters’s addictions led Sharon to file for divorce after four years of marriage. The day after their divorce was finalized, Walters—now 21 years old—married Carol Brown. Carol gave birth to their son seven months later.
Walters’s Young Adulthood and Career
Walters’s time as a young adult was characterized by endless work; he had to make child support payments to Sharon, support his new family with Carol, and sustain his gambling addiction. We’ll explore how Walters became extraordinarily successful as a car salesman and bookmaker before spiraling into debt, divorcing Carol, and moving to Las Vegas with his third wife, Susan.
Experience in the Automotive Industry
Although Walters suffered from gambling and alcohol addictions in his early 20s, he enjoyed great financial success as a car salesman in the automotive industry. By age 20 he was the most prolific car salesman in Kentucky; he earned $56,000 in commissions in 1966, the equivalent of $500,000 in 2023.
Walters then leveraged his experience as a car salesman to start a wholesale used-car business called Taylor Boulevard Auto Sales in 1972. His strategy was simple: He bought used cars on credit, then quickly resold them to pay the banks back and turn a profit for himself. At his peak, Walters made the 2023 equivalent of $5.5 million in a single month.
Divorce From Carol and Marriage to Susan
Walters writes that, even as his career exploded, his personal life was crumbling as he continued to gamble at increasingly higher stakes. The critical moment occurred when his and Carol’s then-seven-year-old son was diagnosed with a terminal brain tumor. The news caused Walters to spiral, drink more heavily than ever, gamble away his money on blackjack, and ultimately default on his bank loans.
Although their son survived despite tremendous odds, Carol divorced Walters in 1976 because of his out-of-control behavior. That same year, Walters married his third wife, Susan, and was still married to her in 2023 when Gambler was published. He credits the success of his third marriage to his decision to quit drinking, a commitment he made following the death of a close friend in the 1980s.
Initial Experience as a Bookmaker and Move to Las Vegas
Although his marriage to Susan signified a positive turning point in his life, Walters was still bankrupt after gambling away the money from his used car business. Thus, he began illegally working as a bookmaker in Louisville in the late 1970s—a time when Louisville’s mayor was seeking to crack down on gambling rings.
His one-man bookmaking scheme quickly became a five-person operation that pulled in $6.5 million in wagers in 1982. As his operation grew, it drew the attention of local police and eventually resulted in Walters’s arrest.
Although Walters avoided jail time, he nonetheless decided that his current lifestyle was too risky. As a result, he moved with his family to Las Vegas, where sports betting was legal.
Experience as a Professional Sports Bettor
In Las Vegas, Walters became famous for his success as a professional sports bettor, where he earned tens of millions of dollars via purely legal gambling.
We’ll focus on Walters’s sports betting career, first via his role in the betting syndicate known as the Computer Group, and later as the head of his own company, Sierra Sports Consulting.
Introduction to the Computer Group
According to Walters, his time in Las Vegas fundamentally shaped his approach to sports betting. In particular, he writes that he became a key member of the Computer Group, a sports betting syndicate that used complex computer modeling to beat Las Vegas betting lines—the bookmakers’ predictions about which teams would win and by how much.
By working with this group, Walters earned enough money to finally pay off his outstanding debt and then some. By the mid 1980s he had accumulated a net worth of $3.5 million.
Walters explains that the Computer Group worked by identifying inaccurate sports betting lines and exploiting them.
For example, suppose the Chiefs are playing the Ravens, and the spread—the expected difference in score between the two teams—is three points in the Chiefs’ favor. This means bookmakers think there’s a 50% chance that the Chiefs will win by at least three points. It also means that, if the Chiefs win by fewer than three points (difficult as that would be in American football) bets on the Chiefs would still lose.
In this situation, if the Computer Group’s model predicted that the spread should instead be six points in the Chiefs’ favor, then the Computer Group would bet on the Chiefs accordingly. Since the bookmakers believe there’s a 50% chance that the Chiefs will win by three points, but the Computer Group predicts that the Chiefs will perform better than that, the Computer Group members should have a better-than-even chance of winning their bet.
Founding Sierra Sports Consulting
Because of a growing desire to bet at levels that the Computer Group couldn’t support—along with some legal trouble—Walters founded his own company, Sierra Sports Consulting, in 1992. According to Walters, Sierra Sports Consulting functioned like an elite investment bank, with “war rooms” running 14 hours a day, seven days a week.
Walters had learned that scale was crucial to sports betting success: For instance, if he had a 5% edge (a higher chance of winning than the calculated odds), then betting $1 million would net him $50,000 in expected profit, while betting $10k would net him only $500. Consequently, he aimed to grow his sports betting operation by finding as many bookmakers as possible who’d take his bets, allowing him to wager exponentially more money than he could while betting only one line at a time.
The upshot is that Walters hired teams of beards—people who placed the bets for him via proxy—who shuttled money around Las Vegas every day. These beards placed bets decided by Walters and other handicappers: those who use computer models to decide which Las Vegas lines are inaccurate and worth exploiting. Walters writes that, during this time frame, his teams were betting several million dollars on a weekly basis.
Walters’s Approach to Sports Betting
Between his time with the Computer Group and Sierra Sports Consulting, Walters developed a concrete approach to sports betting success. His approach has three components: handicapping, unit sizing, and betting strategy.
Component #1: Handicapping
Handicapping involves using computer modeling to predict the spread between any two teams (though Walters focuses on American football). Walters created a system in which teams have relative “power rankings” that estimate which team will have the advantage in any given game, and how large that advantage will be. For example, if the Cowboys are worth 45 points and the Cardinals are worth 38 points, the predicted spread would be seven points in the Cowboys’ favor.
Although Walters doesn’t provide an in-depth strategy for creating these power rankings, he does provide a few examples of how he ranked teams. For instance, he writes that home-field advantage is typically worth three points. Additionally, injuries to key players might be worth, one negative point each. So, for instance, if the Cowboys’ running back were injured, that team might have a power ranking of 44 points instead of 45 for their upcoming game.
Component #2: Unit Sizing
After determining his handicapping, Walters would then determine his unit size, meaning the size of his bet as a percentage of his bankroll (or the total amount of money he’s earmarked for gambling)—1% of the bankroll is one “unit.” According to Walters, you should size your bets in proportion to the size of your edge, though never betting more than three units (meaning 3% of your bankroll) at once.
For example, suppose the Giants played the 49ers and Walters’s handicap was 14 points in the Giants’ favor. In this case, the massive discrepancy would justify his maximum bet of three units. By contrast, if Walters’s system calculated only one or two points in the Giants’ favor, he would place a much smaller wager on the Giants to win: say, 0.5% of his bankroll (half a unit).
Component #3: Betting Strategy
The final component of Walters’s approach involves searching widely for the best lines available to maximize your edge—in other words, look for the bookies whose lines have the greatest discrepancies with the odds you’ve calculated. This will ensure that you get the highest possible return on a winning bet.
For example, you might find that in a game between the Ravens and the Steelers, 10 bookmakers have the spread set at seven points in favor of the Steelers, while one other has it set at only five points in favor of the Steelers. If your handicapping method predicted a spread of, say, eight points in the Steelers’ favor, it’d make sense to place a bet with the bookmaker whose spread is only five points. In short, the more you go against the odds, the more money you’ll get if you win.
Experience With Legal Authorities
Though Walters eventually developed a winning sports betting strategy, it wasn’t without hitches. Walters was raided by federal authorities, indicted multiple times, and even arrested for insider trading in 2017. We’ll discuss these brushes with the law as well as Walters’s time in prison and what he learned from it.
The Raid on the Computer Group
Walters’s first serious brush with the law came in 1985, when federal investigators came to suspect that the Computer Group was a massive, unsanctioned bookmaking operation.
According to Walters, the FBI sought to crack down on illegal bookmaking schemes in the 1980s. However, he clarifies that the Computer Group was actually a betting syndicate, meaning they were placing bets rather than taking them. This is a crucial point because placing bets, even as part of an organized group, is not against the law and does not require a state license like bookmaking does.
For the next seven years, Walters and other members of the Computer Group were subjected to repeated investigations, raids, and trials. When charges of illegal bookmaking didn’t stick, the Justice Department reinterpreted laws to say that placing bets across state lines (which the Group regularly did) was a crime. However, even though bookmaking was illegal outside of Nevada at the time, using an illegal bookmaker was not itself illegal, so Walters was also acquitted of these new charges thanks to that legal loophole. In 1992, the federal government finally announced that it would drop all remaining charges against the Computer Group members.
Even so, the stress and publicity of the investigation, along with tension among the leadership, directly led to the Group’s dissolution.
The Raid on Sierra Sports Consulting
Although Walters founded Sierra Sports Consulting in part to avoid the legal troubles he’d experienced with the Computer Group, he continued to have run-ins with the law. According to Walters, Las Vegas police unjustly raided his consulting group and seized around $5 million of his winnings in 1996.
Although the Las Vegas district attorney declined to press charges after reviewing the evidence, the attorney general moved forward with a false accusation of illegal bookmaking. Over the next six years Walters successfully fended off several different indictments: first the illegal bookmaking charge, and then various money laundering charges.
It wasn’t until 2002, when the chief district court judge of Las Vegas ruled that the attorney general’s case had been based on prejudice and unfounded allegations, that the charges were all dropped and Walters got back the $5 million the police had taken.
Conviction for Insider Trading
While Walters managed to avoid convictions for his gambling operations, he lacked the same fortune in the stock market. In 2017, he was sentenced to five years in prison for insider trading.
Walters explains that he began to dabble in stock market investing in the late ’90s. It didn’t become a problem until 2014, when the Wall Street Journal and the New York Times ran articles suggesting that Walters had traded on insider information. These articles claimed he’d received information from Carl Icahn—a hedge fund manager and a friend of Walters’s—regarding Clorox, a company in which Icahn held a large stake.
The FBI’s initial efforts revealed no wrongdoing, but the agency continued to investigate Walters, looking for other evidence of illegal activity. The investigation eventually shifted to Walters’s relationship with Thomas Davis, who sat on the board of Fortune 500 company Dean Foods.
Federal agents had separately investigated Davis and found him guilty of embezzling funds from a Dallas charity, forcing him to make a plea deal with the FBI: To avoid jail time and other penalties, he pled guilty to the charges and provided information the FBI could use against Walters, testifying that he had given Walters nonpublic information about Dean Foods.
In 2017, based on Davis’s testimony, a federal jury convicted Walters of relying on nonpublic information from Davis to earn an additional $32 million in profit and avoid $11 million in losses. As punishment, he was fined $10 million and sentenced to five years in federal prison—though he was released a year early when then-president Donald Trump commuted his sentence in 2021.
Walters’s Takeaways From Prison
Walters writes that prison drastically shifted his approach to life. In particular, it taught him not to take his life or his loved ones for granted. It also instilled an enduring passion for prison reform.
Walters’s time in prison helped him to reorient his priorities. Most notably, he learned to treasure his time with his family—especially his wife Susan, who stayed married to him and visited him often while he was in prison. He also writes that he prioritizes spending time with old friends, since he knows that many of them won’t be around much longer.
Regarding prison reform, Walters explains that his time in prison illuminated the ways in which prisons fail to prepare inmates for life after their sentences, causing high rates of recidivism. Thus, he’s working to create a program that provides vocational training to inmates, which would allow them to more seamlessly transition back to society. In early 2023, he even committed $2 million to one such program in Nevada, and he hopes to fund several more such programs at other prisons.
