Billie Sol Estes is an American former financier best known for his association with U.S. President
Lyndon B. JohnsonLyndon Baines Johnson , often referred to as LBJ, was the 36th President of the United States after his service as the 37th Vice President of the United States...
. Mr. Estes currently lives in
Granbury, TexasGranbury is a city in Hood County, Texas, in the United States. As of the 2000 census, the city population was 5,718. It is the county seat of Hood County and the principal city of the Micropolitan Statistical Area....
.
Fraud charges
In the late 1950s, Estes was heavily involved in the Texas anhydrous ammonia business. He produced mortgages on nonexistent ammonia tanks by convincing local farmers to purchase them on credit, sight unseen, and lease them from the farmers for the same amount as the mortgage payment, paying them a convenience fee as well. He used the fraudulent mortgage holdings to obtain loans from banks outside Texas who were unable to easily check on the tanks.
At the same time,
United States Department of AgricultureThe United States Department of Agriculture is the United States federal executive department responsible for developing and executing U.S. federal government policy on farming, agriculture, and food...
began controlling the price of
cottonCotton is a soft, fluffy staple fiber that grows in a boll, or protective capsule, around the seeds of cotton plants of the genus Gossypium. The fiber is almost pure cellulose. The botanical purpose of cotton fiber is to aid in seed dispersal....
, specifying
quotaA production quota is a goal for the production of a good. It is typically set by a government or an organization, and can be applied to an individual worker, firm, industry or country. Quotas can be set high to encourage production, or can be used to limit production to control the supply of goods...
s to farmers. The program included an acreage allotment that normally was not transferable from the land it was associated with, but which could be transferred if the original land was taken by
eminent domainEminent domain , compulsory purchase , resumption/compulsory acquisition , or expropriation is an action of the state to seize a citizen's private property, expropriate property, or seize a citizen's rights in property with due monetary compensation, but without the owner's consent...
.
Estes worked out a method to purchase large numbers of cotton allotments, by dealing with farmers who had been dispossessed of land through eminent domain. He convinced the farmers to purchase land from him in Texas and transfer their allotments there, with a mortgage agreement delaying the first payment for a year. Then he would lease the land and allotments back from the farmer for $50 per acre. Once the first payment came due, the farmer would intentionally default and the land would revert to Estes; in effect, Estes had purchased the cotton allotments with the lease fees. However, because the original sale and mortgage were a pretext rather than a genuine sale, it was illegal to transfer the cotton allotments this way.
Eventually, Estes' schemes collapsed, and in 1964 he was tried and convicted on charges related to the fraudulent ammonia tank mortgages. Although Estes went to
prisonA prison is a place in which people are physically confined and, usually, deprived of a range of personal freedoms. Imprisonment or incarceration is a legal penalty that may be imposed by the state for the commission of a crime...
to serve a 15-year term, his conviction was later overturned by the United States Supreme Court in
Estes v. TexasEstes v. Texas, 381 U.S. 532 was a case in which the United States Supreme Court overturned the swindling conviction of petitioner Billy Sol Estes, holding that his Fourteenth Amendment due process rights had been violated by the publicity associated with the pretrial hearing, which had been...
, . His appeal hinged upon the alleged impossibility of a fair trial due to the presence of television cameras and broadcast journalists in the courtroom. He prevailed by a 5-4 vote.
Oscar Griffin, Jr., the journalist who uncovered the scandal, later received the 1963
Pulitzer PrizeThe Pulitzer Prize is a U.S. award for achievements in newspaper and online journalism, literature and musical composition. It was established by American publisher Joseph Pulitzer and is administered by Columbia University in New York City...
.
Further reading
- Duscha, Julius (1964) Taxpayers' Hayride: The farm problem from the New Deal to the Billie Sol Estes case Little, Brown, Boston, Massachusetts, OCLC 360916
- Estes, Billie Sol (2004) Billie Sol Estes: a Texas Legend BS Production, Granbury, Texas, OCLC 61207259; an autobiography
An autobiography is a book about the life of a person, written by that person.-Origin of the term:...
- Estes, Pam (1983) Billie Sol: King of Texas wheeler-dealers Noble Craft Books, Abilene, Texas, ISBN 0-915733-00-5; a biography by his daughter
- Intergovernmental Relations Subcommittee (1966) Operations of Billie Sol Estes: eighth report by the Committee on Government Operations Intergovernmental Relations Subcommittee, House Committee on Government Operations, United States Congress
The United States Congress is the bicameral legislature of the federal government of the United States, consisting of the Senate and the House of Representatives. The Congress meets in the United States Capitol in Washington, D.C....
, Government Printing Office, Washington, D.C., OCLC 35
- Staff (May 25, 1962) "Investigations: Decline & Fall" Time Magazine
Time is an American news magazine. A European edition is published from London. Time Europe covers the Middle East, Africa and, since 2003, Latin America. An Asian edition is based in Hong Kong...
an account of the Billie Sol Estes scandal; Time cover: "The Billie Sol Estes Scandal" 25 May 1962
- Demaret, Kent (April 23, 1979) "Billie Sol Estes May Face New Fraud Charges, but He's Never Up the Creek Without a Paddle" People
In 1998, the magazine introduced a version targeted at teens called Teen People. However, on July 27, 2006, the company announced it would shut down publication of Teen People immediately. The last issue to be released was scheduled for September 2006. Subscribers to this magazine received...