THE INDUCTEES: Billie Sol Estes

Texas wheeler-dealer

Cotton farmer turned millionaire, Billie Sol Estes made a fortune in fertilizer and grain storage.  The Texan also ran the most notorious con of his day, which erupted into a scandal of crooked government officials and the untimely death of a would-be whistleblower.  The mystery of the Texas wheeler-dealer only deepened as a Senate committee and cadre of FBI agents launched investigations.  Estes may have come across as a man of faith from humble origins, but he ran an incredibly complex scheme that took effort to unravel.  Among the biggest questions: the nature of his generous support for powerful Democratic politicians, including Vice President Lyndon B. Johnson.

In the late 1950s, Estes made a name amongst West Texan farmers as a major distributor of fertilizer.  But by 1958, he had borrowed more anhydrous ammonia than he had bought from his supplier.  To pay off his debt, Estes hatched a deal with the chemical manufacturer.  He started a grain storage business with funds he borrowed from Commercial Solvents; in exchange, Estes gave the company 100 percent of the fees he received to store grain.  As long as the money kept rolling in, Commercial Solvents gave him all the fertilizer he wanted.

To make the scheme work, Estes brought in a key partner: the U.S. government.  He landed a federal contract to store grain in a loan program for farmers. Later, it was revealed just how he landed that contract: by taking three officials from the Agriculture Department on a shopping spree at the Neiman Marcus department store.  With these and other bribes, Estes secured about $7 million between 1959 and 1961.  Those funds went to Commercial Solvents, which in turn provided Estes with fertilizer to sell at cut-rate prices to farmers.

More than 100 farmers also purchased storage tanks on credit and leased their mortgages to Estes. With those mortgages – and stacks of phony financial statements for non-existent tanks – he borrowed about $22 million from finance companies. 

At the same time, he ran yet another illegal scam and snapped up 3,000 acres of land to grow cotton.  Estes got his hands on allotments to grow cotton, a highly regulated crop, from farmers who had lost their land under eminent domain.  He convinced the farmers to buy his land in Texas and transfer their allotments to the new land.  The farmers were then set up on a payment plan, on which they inevitably defaulted. When that happened, the land (and the allotment) transferred back to Estes under the terms of the deal.

But for all his deal-making and friends in high places, Estes couldn’t stay in business forever.  After reporters at his hometown newspaper discovered there were no tanks to back up his numerous mortgage applications, Estes was arrested in March of 1961.  A Congressional committee launched an investigation into his contacts within the federal government; meanwhile, nearly 80 FBI agents were charged with digging into his business dealings.

A troubling wrinkle in the case, which was never fully settled, came with the sudden death of the man who ran the cotton allotments in Texas.  Three months after Estes’ arrest, Henry Marshall was discovered in his car with five bullet holes fired by the rifle at his side.  Though his death was ruled a suicide by Texas authorities, some people were certain it was murder – including the Arkansas senator who led the committee to investigate the scandal.  During committee hearings, Sen. John McClellan brought in a long-barreled rifle to demonstrate the difficulty of using such a gun to shoot oneself five times.  A motive for Marshall’s murder also became apparent during the hearing.  On more than one occasion, Marshall had warned his bosses at the Agriculture Department that Estes’ cotton allotment deals were illegal.

In 1963, Estes was convicted of mail fraud and conspiracy and sentenced to 15 years in federal prison.  During his State Court trial that same year, he was sentenced to an additional 8 years; that conviction was later overturned by the U.S. Supreme Court, which ruled that his Constitutional rights had been violated by television and radio coverage of the pretrial hearing. 

Estes served six years and was released on parole in 1971.  Eight years later, he was indicted on mail fraud and income tax evasion and served another four years in prison.  Upon his release, Estes testified before a grand jury that Lyndon B. Johnson ordered Marshall’s murder to cover-up his role in the scam.  Now 85, Estes lives in Texas and claims on his website to have kept his mouth shut about the murder in order to avoid a similar fate.