Wilpons are in trouble, no matter what
Mets fans don't trust team's owners, whether they knew about Madoff scheme or not
The lawsuit says the owners of the New York Mets knew or should have known they were doing big business with a common crook, and those same owners -- Fred and Jeff Wilpon and Saul Katz -- swear they knew nothing until Bernie Madoff was hauled away in cuffs.
The suit seeks a return of fictitious profits in the amount of $300 million, or enough cash next winter to buy Albert Pujols and a couple of quality arms. Right here, right now, it isn't fair to assume the Wilpons are guilty of anything but managing their investments the same way they've managed the Mets.
By putting their money on the wrong horse, time and time again.
But right here, right now, it is fair to assume that the millions of men, women and children who make up a beaten-down fan base might never again trust the Wilpons to deliver them a product worthy of their affection and time.
Up front, understand that I am neither an observer who wishes any ill will on the avuncular Fred, nor am I a columnist who carries Jeff's golf bag from tee to green. From that position of neutrality, through an agenda-free lens, it seems the Wilpons will have a rough time convincing their customers they are fit to build and run a winning major-league team.
"There are thousands of victims of Madoff's massive Ponzi scheme," opens the devastating lawsuit unsealed Friday. "But Saul Katz is not one of them. Neither is Fred Wilpon. And neither are the rest of the partners at Sterling Equities ..."
Katz has forever been the Claude Rains of the ownership group, the invisible man behind the father-and-son team that lords over the Mets. That role (or non-role) is serving Katz well right now, as Fred and Jeff are the ones out there in public, taking all of that high heat under their vulnerable chins.
Irving Picard, trustee for Madoff's many victims, is the one throwing the heat, claiming that Sterling's partners opened 483 Madoff accounts, that the Mets had 16 such accounts, and that "approximately $90 million of other people's money withdrawn from the Mets' (Madoff) accounts helped fund its day-to-day operations."
Among the more alarming allegations is this: The Mets owners ignored repeated warnings from advisers that they might be contributing to one big, fat fraud. The suit alleges that the Wilpons and friends willingly chose the ignorance-is-bliss route, pocketing "so much easy money from Madoff for so long that ... the Sterling partners chose to simply look the other way."[+] EnlargeJohn Munson/THE STAR-LEDGER/US PresswireEven if they come out on top in the lawsuit, the Mets' owners have an angry fan base to deal with.
The Mets owners called the allegations "outrageous and irresponsible," spoke of the pain they felt over Madoff's betrayal of their 25-year friendship, and maintained they were "as shocked as the rest of the world when the money in our accounts vanished along with the billions he swindled from thousands of other innocent people."
Of course Bud Selig was most concerned about this matter even before baseball's lawyers started speed-reading the lawsuit. Does the commissioner believe there's a possible scenario here where the Wilpons take this one the distance, lose at trial, and end up in a position where they'd have to sell the entire team, and not just 25 percent of it?
What do you think?
"This is a disaster for the New York Metropolitan baseball club, no question about that," said Bob Costello, a partner in the firm of Levy, Tolman & Costello and a lawyer who represented George Steinbrenner and the Yankees in dealings with the commissioner's office.
"If the owners of the Mets were complicit in the grandest Ponzi scheme in American history, and they say they weren't, then this would bring the case to another level of discussion with Bud Selig."
Again, the Wilpons say any such charge is "abusive, unfair and untrue." They say they have been victimized two times over, first by Madoff, now by Picard.
They say, "We have done nothing wrong," and declare with all of Rex Ryan's confidence that they will win this case in court.
But back to Picard's charge that just about everyone except Madoff himself long ago warned the Wilpons that their fabulous returns were likely the product of some very fuzzy math. It's right there on Page 201 of the 373-page suit, under the bold-faced heading, "Madoff's Returns Were Too Good To Be True And Sterling Knew It."
If it's proven those warnings were made, that won't help the Wilpon cause.
"I wished someone would have warned me," said Richard Friedman, a 61-year-old CPA who lost his life's savings -- about $3 million -- in Madoff's scam. Friedman was among 29 victims who contributed essays to the book, "The Club No One Wanted To Join -- Madoff Victims In Their Own Words," and his first head's-up came in the form of a phone call the day Madoff was nailed, a little too little and a lot too late.
"I was completely blindsided," said Friedman, a "net loser" who had no relationship with Madoff. "Going home to tell my wife we'd just lost everything was the worst moment in my 40 years with her."
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Friedman, not Fred or Jeff Wilpon, is the face of your average victim. Madoff wiped out Friedman's sister, too, a woman who suddenly couldn't afford high-end treatments for the ovarian cancer that last month claimed her life. Friedman's mother, suffering from Alzheimer's, now faces a claw-back lawsuit for being among the unlucky and unwitting "net winners" in Madoff's shell game.
"We are all innocent investors," Friedman said, "and if the Wilpons can show that they're innocent victims, too, then they should not be clawed back. Only time will tell."
Time and testimony. The Mets owners contend that they lost $500 million, that the SEC notarized Madoff, and that Picard's lawsuit is merely meant to ruin their reputations and force them to pay a huge settlement price.
For the sake of their legacy, I hope they are right. In the end, the truth will set one of these parties free. Fred and Jeff might be guilty only of showing terrible judgment in their choice of friends.
Meanwhile, with Irving Picard looking as formidable as the Phillies' rotation, Mets fans already fed up with the owners' investments in pitchers and hitters now have fresh reason to stay clear of Citi Field.
Fred and Jeff could lose tens of millions here, maybe more, and good luck finding anyone who still believes their old claim that Madoff's madness won't have any impact on the team.
No, this isn't a good day to be a Mets fan, not after the Wilpons once again put their money on the wrong horse.
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