The Rise and Fall of the Biggest Illegal Sports-Betting Ring in Dallas History

BY SEAN CHAFFIN
One morning in 2011, just after sunrise, a swarm of federal agents rolled quietly down a neatly manicured cul-de-sac in Southlake, the city police's SWAT alongside them. They gathered outside the home of their target, a $750,000 spread with five bedrooms, five bathrooms and a swimming pool, all sitting on a tree-lined half-acre lot in perhaps Dallas' most idyllic suburb. Around 7, they knocked on the door, and waited.

There was no made-for-TV chaos, no upturned tables or scattering underlings. After a brief wait, the man they were there for, 57-year-old Albert Sidney Reed, approached the door, sleep still in his eyes. He was in his underwear.

Reed's teenage son looking on, police calmly handcuffed their target, and black-clad SWAT officers shuffled inside to sweep the 5,250-square foot house. When the all clear was given several minutes later, Reed was un-cuffed and allowed to dress. He sat in a chair inside for four hours as investigators sifted through his belongings, looking for proof of what they already knew.

About an hour into the search, another IRS agent stumbled across a satchel in Reed's SUV and shuffled through its contents: printouts of wagers, collection notes, business expenses, printouts of how much his betting operation profited during football season, even notes from a big meeting upper-level owners in the organization had recently conducted. Later, he made sure to introduce himself to the satchel's owner.

"I'm Special Agent Mark Parsons with the Internal Revenue Service," he said. "We're investigating the Global International Corporation bookmaking operation, and you and I are going to get to know each other pretty well over the next six months. You can make it good on yourself -- or hard on yourself."

---

via the IRS

Ringleader Al Reed with a bettor. He was watching his phone; the feds were watching him.

Detective Curtis Coburn was sitting at his desk inside the Plano Police Department, doing the usually fruitless but necessary work of reading through mail, when he came across a letter. It was anonymous -- always a good sign.

It was 2001. Coburn, by then, had policed the suburb for more than 25 years, so he recognized many of the names sprinkled throughout the letter. He read on, intrigued by mention of bookies and bettors across the country, the Internet and phone banks based on the tropical island of Curacao. It was so specific, Coburn knew there was something to it, even if it wasn't as grand as described. Along with fellow detective Grant Harp, he started plotting to get inside the operation.

Their plans came to a halt with 9/11, as Coburn hit the streets chasing terrorism-related leads. But a year later, Coburn and Harp were back on the case. Working contacts from previous investigations, Coburn hooked up with a bookie out of Bonham named "Bull" and began placing some bets -- a few bucks here on football, a few there on baseball. He also kept tabs on his new bookie, hoping his world would intersect with the one described in the letter.

It never did, but a few months later, Bull was stopped in Plano and arrested on gun and drug charges. With Bull in jail, his bettors had lost their betting connection. That gave Coburn an idea. Figuring most Dallas-area bookies know each other, Coburn used Bull's temporary hiatus to make a connection with Gregg Merkow, a bookie he had a hunch was involved in the operation described in the letter. Merkow owned the Hurricane Grill on Greenville Avenue and Greenville Bar & Grill.

Coburn was no stranger to undercover work. He'd bought stolen goods in the burglary unit, assisted with intelligence in prostitution and massage parlor stings, and once pretended to be a hit man collecting $20,000 to kill a man. Early in his career, while undercover in the narcotics division, Coburn had learned not to "act a part." The key, he discovered, was to be yourself. Either the bad guys trust you or they don't.

One afternoon, Coburn and Harp showed up at the Hurricane and grabbed a seat. The place had a lively atmosphere with a Cajun menu, and its signature drink was the aptly-named "Category 5" -- a 45-ounce hurricane drink on the rocks or frozen. Merkow, an entrepreneur and professional poker player with more than $1.6 million in lifetime winnings, was nearby writing paychecks as the two officers surveyed the scene. Soon the three of them were talking sports and gambling.

"You a player?" Merkow asked the detective.

"I go to Vegas pretty often," Coburn told him.

"Do y'all have anybody local?" Merkow asked.

Coburn told him about his bookie, Bull, noting vaguely that the relationship had soured. He was looking for someone new for his action, Coburn said.

"Are you a cop?" Merkow asked.

It was a welcome inquiry. People think if they ask it and the undercover officer says no, the officer can't arrest them later. Coburn's pretty sure some undercover cops started that rumor years ago. Either way, it's not true.

"No, I'm not a cop," he said.

"Well, I'll hook you up," Merkow said. "You'll be dealing with my father, Leo."

As the meeting continued, Merkow worked some basic information from his new "client" and assigned him a log-in to a wagering website. He gave him a line of credit for the site but told him he would settle up in cash with Leo.

Coburn went back to the office, logged in and started placing bets. In the days and weeks that followed, he spent more and more time at the Hurricane, working himself into the group, making connections and making bets, all under the watchful eye of federal agents. They saw Leo, who was there almost every day, collecting envelopes of cash from bettors. If he wasn't around, they knew to give the envelope to the bartender, who stashed them in the cash register for safekeeping.

---