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Wall Street Crime and Punishment: Billie Sol Estes, The Great Texas Flim-Flam Man, Kennedy Assassination Conspiracy Theorist

Wall Street Crime and Punishment: Billie Sol Estes, The Great Texas Flim-Flam Man, Kennedy Assassination Conspiracy Theorist

Does crime pay?

Wall Street Crime and Punishment is a weekly series by Benzinga's Phil Hall chronicling the bankers, brokers and financial ne’er-do-wells whose ambition and greed takes them in the wrong direction.

During the early 1960s, Americans were captivated by a larger-than-life Texan who fleeced the federal government and the banking industry while boasting of connections in the highest levels of Washington D.C. and leaving a pile of bodies in the wake of his chicanery.

Indeed, had Billie Sol Estes never lived, it would have been impossible for any creative writer to invent him — he was a gregarious nightmare of financial legerdemain and emotional complexities, wrapped with a rich Lone Star State twang.

An Honest Young Man: Billie Solomon Estes was born Jan. 10, 1925, on a farm near Clyde, Texas. He began his business endeavors at seven, when he asked for and received a lamb for Christmas. The boy bred his lamb with a neighbor’s ram and within two years he had four additional lambs. He bought more lambs with money earned from working at a local dairy farm, eventually gathering enough wool from his growing flock to sell in the local markets.

At the age of 15, Estes wrote to President Franklin D. Roosevelt asking if there were federal programs that could help farmers in Texas’ Callahan County who faced a severe drought. The president wrote back to him, pointing to a federal program that offered surplus grain for sale. Despite his youth, Estes secured a $3,500 bank loan to purchase 17 train cars of grain, selling the commodity to the neighboring farms and keeping some to feed his family’s livestock.

When he reached 18, Estes amassed $38,000. He also received his first media attention via an article in the Abilene Reporter-News. Estes routinely cut school during his youth to concentrate on his agricultural business endeavors, and he opted not to attend college. Instead, he put his work on hold to serve in the U.S. Merchant Marine during World War II.

Following his discharge in 1946, he married his childhood sweetheart Patsy Howe and turned his focus to real estate, acquiring decommissioned military barracks from the U.S. Army and converting the properties into housing for returning veterans. He relocated to a farm outside of Amarillo and conducted experiments in irrigation that created bountiful harvests.

Estes sold his farm and began buying up land in and around Pecos, a small and struggling Texas city that had seen better days. He quickly amassed 26,000 acres and began to branch out into diverse industries.

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A Man Of Principles: In Pecos, Estes became involved in farm equipment sales, construction and trucking. He built grain elevators and acquired mineral rights in the surrounding areas.

But he wasn’t all work. Estes established himself as an elder of the Church of Christ. His Sunday sermons preached against what his church considered to be immoral behavior — including dancing — and at his home he would not allow boys and girls to swim together in his pool.

Estes was also concerned about the disenfranchisement of Black and Hispanic residents in his region. Learning that a local funeral home refused to handle the bodies of nonwhites, he opened his own mortuary to serve that neglected community.

He provided funding for Black students to attend college and opened his home to Black ministers passing through the area. During a business trip to Atlanta in the late 1950s, he became acquainted with Rev. Dr. Martin Luther King Jr. and began providing donations to fund his civil rights crusade.

Estes’ politics were not well received by many in his community. Some white families refused to allow their children to play with his children, and his attempt to get elected to the local school board failed due to a pro-segregationist sentiment among the majority of voters.

A Detour From Ethics: Up until now, Estes was recognized as a hard-working and honest man. But at this point in time, Estes started to behave out of character — or, perhaps, he began to develop into a wildly different character from the go-getter traits that helped him to amass a fortune.

Estes’s money helped him create friendships with powerful politicians during the 1950s, including fellow Texan, the then Sen. Lyndon B. Johnson. Estes would host parties for legislators at his Pecos mansion and made generous donations to their campaigns, and his Beltway buddies would welcome him during his trips to the nation’s capital.

With Johnson’s support, Estes secured contracts to lease grain silos to the federal government, earning him millions of dollars. He also found another source of revenue in anhydrous ammonia, which was used by farmers in fertilizer, and started manufacturing portable fertilizer tanks to sell to farmers.

And this is where things started to unwind.

When Estes sold the fertilizer tanks, he arranged for the farmers to provide him with their financial statements, which he then used for security when borrowing money for expanding his operations. The farmers would get a 10% cut on his loan amounts.

Alas, demand for the tanks outpaced the supply, and lenders wanted to see the tanks being cited as collateral. Rather than try to speed up production, Estes arranged to have the tanks moved from location to location, switching the identification tags on the tanks to fool the inspectors sent to appraise the collateral.

By the early 1960s, Estes scammed $24 million from unsuspecting lenders by pretending to have 33,500 more tanks than were on the Texas farms.

If that wasn’t bad enough, Estes also circumvented federal rules on the transfer of land allotments for cotton farmers by arranging bogus real estate transactions. Since the law prevented a direct purchase of allotments, Estes choreographed an elaborate mortgage fraud scenario in which farmers intentionally defaulted on their loans and Estes then acquired the land. The farmers received a handsome cut while Estes enjoyed the bulk of the profits and a wider land portfolio.

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Downfall: The first cracks in Estes’ empire occurred in 1960 when Henry Marshall, head of the Texas office of the federal agency responsible for farm subsidies, became suspicious of what was taking place and quietly began investigating.

In June 1961, Marshall was found dead at home with five gunshots to his chest and bludgeoning to his head. The local police immediately declared the death was a suicide.

While Marshall’s investigation died with him, another probe began in early 1962 via Oscar Griffin Jr., editor of the Pecos Independent newspaper. Griffin learned of the unusual activities with the fertilizer tanks and he had a personal vendetta against Estes, who started a rival newspaper in Pecos after Griffin refused to endorse the businessman in his bid for a school board seat.

Griffin’s newspaper started to run a series of articles on the fertilizer tank shenanigans, and the reporting was quickly picked up around Texas and then in Washington D.C. Estes’ financial kickbacks to Agriculture Department officials for grain storage contracts came to light, and President John F. Kennedy directed the FBI and the Justice Department investigate whether Vice President Johnson and Agriculture Secretary Freeman were tainted by Estes. A congressional probe was also launched.

On April 5, 1962, Estes’ accountant George Krutilek was found dead at his home. Although his body showed violent bruising on head, police investigators declared his death a suicide. The next day, a grand jury returned 50 state and federal indictments against Estes and three of his colleagues.

In addition to Marshall and Krutilek, five other men who had connections to Estes’ business affairs died under mysterious circumstances: two were found in cars full of carbon monoxide and three dying in accidents, with one involving an airplane crash.

Griffin emerged from the Estes wreckage with a Pulitzer Prize and he purchased Estes’ newspaper after it went into receivership.

A Strange Fadeout: As the Estes saga unfurled in the media, the public was fascinated by the audacity of the Texan’s schemes. His trial featured television cameras in the courtroom, a rarity at the time, which gave the legal proceeding a circus-type element. The legal spectacle inspired three popular comedy folk songs that turned Estes’ financial crimes into mirthful romps.

In 1963, Estes was convicted state and federal was sentenced to 24 years in prison. But two years later, his lawyers appealed to the U.S. Supreme Court that the television cameras covering his case made it impossible for him to receive a fair trial. The justices voted 5-4 and his state conviction was overturned.

Estes was paroled from federal prison in 1971 and mostly disappeared from sight, only to return to the spotlight in 1979 facing charges of tax fraud. He was found guilty and sentenced to four years in prison.

Upon his release, Estes began to give interviews claiming that Lyndon B. Johnson was behind the deaths of the men tied to his case in the early 1960s because the then-vice president was actively involved in the fraudulent activity and wanted to prevent the truth from emerging.

Estes went one step further, claiming a Johnson aide named Mac Wallace, acting on his boss’ command, was the alleged second gunman who fired the fatal shot at President Kennedy’s motorcade in Dallas in November 1963, and then recruited Jack Ruby to kill Lee Harvey Oswald after the latter was arrested for the assassination. No historian ever took Estes’ claims seriously.

Estes was 88 when died at his home near Granbury, Texas, on May 13, 2013. Towards the end of his life, Estes agreed to a few where-are-they-now interviews. Time was kind to him, as reporters depicted him as a loving father and grandfather who was at peace with himself despite his bizarre life.

And even in his later years, he could still make strange deals — he consented to an interview with Texas Monthly on the condition that the reporter treated him and his family to a dinner at his favorite Olive Garden eatery.

“I’ve always been able to make money,” said Estes to the Texas Monthly writer amid a lasagna dinner. “If I put my mind to it, I could make a million in the next 30 days.”

Related link: Wall Street Crime and Punishment: Preston Tucker, The Auto Visionary Run Over By The SEC

(Photo of Billie Sol Estes from the Everett Collection, licensed through



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