GRAND PRIX, GRAND SCAM-GRAND JURY?

DALLAS-We first knew Don Walker as the quiet, handsome, curly-haired millionaire real estate syndicator who drew the eyes of the world to Dallas last summer. For months, his name graced newspaper and magazine accounts detailing the globe-trotting efforts to bring a Formula One Grand Prix to Dallas. It was a feat that quickly hoisted the 41-year-old former CPA from Oklahoma City to the top of Dallas’ social ladder. Walker struck like a German blitzkrieg soldier and came from nowhere to quickly become Dallas’ man of the hour.

What a difference a year makes. Although Walker contracted to put on a Grand Prix annually through 1988, there will be no graceful racing machines roaring through Fair Park this summer. There may never be again. The same man who brought us the Grand Prix in 1984 has been responsible for its demise.

Today, Walker is broke, with the threat of criminal prosecution hanging over his head. Just last December, Walker was spending money like a man sitting atop a fortune, but recently he has filed court documents claiming he can’t even pay the bills to have his tuxedo laundered. Walker and his wife Carol have abandoned their once-glittery social life, exiling themselves to their 800-acre wooded ranch near Terrell. Some reasons for the Walkers’ fall from grace:

● Walker’s syndication firm, DRW Investments Ltd., has become the target of concurrent investigations by the FBI and the U.S. Securities and Exchange Commission. Walker is taking the federal inquiries seriously: He’s hired Dallas criminal law specialist Douglas Mulder, a powerful attorney who was a former first assistant to Dallas County District Attorney Henry Wade.

● Armed with civil subpoenas, auditors hired by a group of Walker’s investors began pouring over DRW’s books in February to determine whether Walker “co-mingled” funds between some of the 92 syndication projects of which he is a general partner. Among the investors’ allegations is a charge that Walker secretly sold three apartment complexes without the legally required limited partner approval and deposited $400,000 of the profits into his own money market account. Those investors are now maneuvering through the bankruptcy courts to appoint a succeeding general partner to take the reins of DRW Investments from Walker.

● While only a year ago his bankroll made him a force in international auto racing, Walker’s problems in pulling off the Dallas Grand Prix and his abrupt financial withdrawal from the Can-Am racing series last year have made him something of a joke in racing circles. Walker ran off Dallas oilman and Grand Prix partner Jarrett “Buddy” Boren, grabbed the public limelight from co-founder Larry Waldrop and left behind a pack of angry critics, including race sponsors, contractors and officials from Fair Park and the Formula One Constructor’s Association (FOCA). The 1985 Dallas Grand Prix unofficially died last fall when Walker got into an argument with FOCA over a race date, failed to come up with the front money for the race and didn’t inform Fair Park officials of a race date. It officially died on March 25 when Walker placed Dallas Grand Prix of Texas Inc. in Chapter 11 bankruptcy.

● Until recently, few knew that Walker once worked for a shady duo of real estate syndicators who were indicted (and subsequently acquitted) last year in connection with an alleged $18 million real estate syndication tax fraud; or that Walker was asked to resign as a board member of Union Bank and Trust and Parkway Bank and Trust because his accounts showed overdrafts of as much as $500,000.

Walker isn’t talking, but his attorneys maintain he has done nothing wrong. Employees who remain loyal to Walker (the list is shrinking) say privately that their boss hasn’t swindled anyone, but is the victim of a flat real estate market and tax reforms that have made syndication packages far less attractive to investors.

Although it became apparent as early as last November that the 1985 Grand Prix was in jeopardy, Walker’s serious financial problems remained a secret until he filed for bankruptcy in March. That was about five weeks after the group of six investors accused Walker of a host of irregularities, essentially accusing him of pocketing millions of their investment dollars and financing losing ventures with profitable ones.

Only a year ago, the Walkers were living the good life, spending money with abandon. The Walkers own a $6 million home in North Dallas that friends called “the castle.” The Walkers were also frequent travelers to Europe and owned residences in Crested Butte, Colorado; Car-mel, California; Jacksonville, Florida; and the Cayman Islands, not to mention a yacht in Florida. When the Walkers traveled for business or pleasure, it was via chartered Lear Jet.

Now Walker’s problems have become so serious that he has begun selling off his pride and joy, a collection of some 40 to 50 exotic cars which has included not only Ferraris, Porsches and Cobras-both originals and replicas-but also such gems as the old Clay Riggazone Formula One Ferrari and a vintage Ferrari GTO, which Walker reportedly sold to a Japanese car collector for about $700,000.

People who know the couple attribute their financial demise largely to Don’s expensive racing tastes and Carol’s equally costly “social habit.” Walker first became interested in big-time racing in the fall of 1982 when Dallas exotic car dealer and mechanic Bob Norwood sold him his first Ferrari Boxer for $85,000. Walker and Norwood eventually became partners of the Can-Am race team that won the series championship in 1984.

“I’ll never forget the first time I heard of Don Walker,” recalls Norwood. “This salesman from Classic Cars gave me a call and told me that Walker was this guy with more money than God. The guy said, ’Let’s rip him off. He doesn’t know his ass about cars.’ “

Boren, an original Grand Prix partner bought out by Walker in October 1983, believes he was forced out so Carol Walker could assume the management reins of the race. “I really don’t hold any bad feelings toward Don Walker, but it was a race being held as an excuse to hold a party,” Boren says. “The Grand Prix was a springboard for Carol Walker’s introduction to society. It was supposed to have been an event for Dallas-not for the polo and hunt club.”

Indeed, insiders say the Walkers spent bushels of money to court Dallas society and media, even hiring publicist Gloria McCall Godat to help them pave their way socially. “I was shocked at how wealthy they were and how few people they actually knew,” says one friend of the Walkers.

Though Walker has been in the public eye for the last two years, details of his past remain guarded. His company promotional material, for instance, fails to mention a brief stint in 1979 as financial officer of Wes-co Investments Inc., where he worked for Ronald E. West, a silver-tongued California tax shelter promoter, and G. Charles Cole, a Southern Methodist University MBA who was West’s Dallas-based partner.

Cole, West and Ralph Freed-son, a disbarred Houston attorney, were indicted last year for preparing tax returns that reported $50 million in partnership losses during 1977 and 1978 for 805 syndication investors, $18 million of which the government said were fraudulent. Walker testified in late March at Cole and Freedson’s trial, a few days before he filed for bankruptcy. Cole and Freedson were acquitted on April 2, partly due to credibility problems of a key government witness. West fled the country.

Meanwhile, Walker has insulated himself with a layer of high-priced attorneys, and in some ways he’s proceeding as if nothing were happening. Although he must seek approval from a federal bankruptcy court even to pay DRW’s electric bill, Walker is somehow managing to support his racing habit, the real passion of his life. He still finances a team and drives vintage car races on the weekends-he won the Walter Mitty vintage car race at Road Atlanta last April-and, although he is a relatively inexperienced driver, he recently laid plans to drive his own Can-Am series race car this summer.

“He’s so quiet that you just can’t tell about him,” says Norwood. “He’s a very secretive kind of guy. Nobody ever felt comfortable with him because he never said anything.”

“The last time I saw him was at the Can-Am race he sponsored in Richland Hills last October,” says Boren. “I visited him in his box, just after he finished driving in the vintage car race. I really wonder about him sometimes. Here’s a guy who’s losing $400,000 or $500,000, and he’s exuberant.”

-Eric Miller