Pete Rose Trial: 1990

Defendant: Pete Rose
Crime Charged: Filing false tax returns
Chief Defense Lawyers: Reuven Katz, Roger J. Makley, and Robert Pitcairn, Jr.
Chief Prosecutors: G. Michael Crites and William E. Hunt
Judge: S. Arthur Spiegel
Place: Cincinnati, Ohio
Date of Trial: April 20, 1990
Verdict: Guilty
Sentence: 5 months' imprisonment, 3 months in a community treatment center or halfway house, $50,000 fine, and 1,000 hours of community service

SIGNIFICANCE: This case revealed how a spectacular career as a nationally admired, recordbreaking athlete can be ruined by an addiction to gambling. It also demonstrated that even national heroes face prison when they stiffarm the Internal Revenue Service.

On August 23, 1989, long-time Cincinnati Reds player-manager Pete Rose was banished forever from the game of baseball by Baseball Commissioner A. Bartlett Giamatti. Rose, who held the record for more career hits and games played than any other player in baseball history, admitted that he had bet on football and basketball games. His behavior, said the commissioner, had "stained" the game. The evidence before the commissioner led him and, almost immediately, the American public to the conclusion that Rose was a compulsive gambler.

Six months later, a federal grand jury was investigating whether Rose might owe taxes on income from cash he earned at baseball card and memorabilia shows. One newspaper quoted "sources" as saying that the beloved ballplayer had failed to report to the Internal Revenue Service at least $250,000 in income between 1985 and 1987. Witnesses were reported to have seen Rose take cash earned at baseball card shows—where he signed hundreds and hundreds of autographs at $8 each—and stuff it into suitcases and sacks. The implication was that Rose used the huge amounts of cash to support his costly gambling habit.

By mid-April, the news was confirmed. Pete Rose and his lawyers had worked out a plea bargain. He would plead guilty in U.S. District Court in Cincinnati to two felony counts of filing false federal income-tax returns. The bargain was that Rose would not be charged with failing to report income from gambling, despite the fact that one of his associates had been convicted only months earlier of conspiring to defraud the IRS by claiming one of the ballplayer's winning racetrack tickets as his own.

On April 21, Rose appeared before Judge S. Arthur Spiegel. Confirming charges that he had knowingly failed to reveal income of more than $300,000 in 1985 and 1987, he pleaded guilty to the two felony counts. The Statement of Facts, a court document signed by Rose and his attorneys, described him as a "chronic gambler during the years 1984 through 1988, betting substantial amounts of money at horse and dog racetracks, as well as with illegal bookmakers." Said Assistant U.S. Attorney William E. Hunt, who presented the government's case:

Rose received $129,000 from an individual who purchased his "4,192' bat [the bat with which he broke Ty Cobb's record for career hits] by requesting and receiving [as partial payment] 11 checks for $9,000 and one check for $5,000. These checks were cashed at the bank on separate days in order to avoid the filing of currency transaction reports.

Even more was revealed in the courtroom. In 1987, Rose had filed amended tax returns for the years in question. But they were still false, for he failed to report $51,800 in 1984, $95,168 in 1985, $30,659 in 1986, and $171,552.60 in 1987.