The Wilpons: Not newbies on this Ponzi scheme fraud thing

The hits just keep on coming for the Wilpons and while you might think I am enjoying this, subtly or less-than-subtly, it’s just so ugly for the game and that’s not a good thing:

For Wilpon and Katz, the episode did not garner anywhere near the public attention their entanglements with Madoff have, but there are striking similarities. Indeed, a review of court records and interviews suggests the debacle with Israel’s hedge fund, Bayou, was a painful precursor to the Madoff case.

The firm Wilpon and Katz started, Sterling Stamos, was accused of having withdrawn money from a fund run by Bayou after detecting evidence of possible fraudulent activity. The firm took out nearly all of its $30 million from the fund months before it collapsed.

And the eventual tie-in to the Madoff case:

According to two lawyers involved in the case against the Mets, the trustee, Irving H. Picard, argued in a lawsuit filed in December that the history of Wilpon and Katz’s dealings with Madoff meant they knew or should have known it might be a scheme, and that, as a result, other victims were entitled to hundreds of millions of dollars above and beyond what Wilpon and Katz might have made as profits. “Some of the legal principles adopted in Bayou are the same ones that the trustee is applying,” said Richard Kirby, the lead lawyer for the creditors committee in the Bayou case.

In other words, Picard is using the age-old “fool me once, shame on you; fool me twice, shame on me” mantra. Except the Wilpons got fooled twice. Continue reading The Wilpons: Not newbies on this Ponzi scheme fraud thing

Wilpon’s insistence on selling only a non-controlling interest is going to be tested

Remember that whole “intend to maintain the majority, controlling interest” thing about the Wilpon’s selling a stake of the Metsies? I reserve the right to be entirely surprised, but it looks like the list of interested parties is growing but not for that minority interest that the Wilpon’s want to sell:

The son of the late civil-rights leader is uniting with some heavy hitters, including Mets legend Ed Kranepool; entrepreneur Donn Clendenon Jr., son of the 1969 Mets World Series MVP; TV executive Larry Meli; and a number of unnamed deep-pocketed investors, The Post has learned.[…]

King declined to comment on the particulars, but Meli said he and his group are looking to purchase at least 50 percent of the club. That could be a roadblock, but Meli said he hopes the two sides can work together.

“I think in order for it to make sense it would have to be at least a 50-50 arrangement,” said Meli, a trusted friend of King.

In other words: Without control in the operations of the Mets organization (either initially or attainable in the future), the list of financial life preservers will be limited. I contend that if the Wilpon’s truly need the liquidity to resolve the pending lawsuits, they will have very little choice but to sell more than they’d like.

(click “view full post” to read more) Continue reading Wilpon’s insistence on selling only a non-controlling interest is going to be tested

Wilpons’ integrity in question?

Some very interesting info coming out of Murray Chass today and as I have said before, so long as it’s baseball-related story-telling, Chass is still a good read:

The Picard lawsuit is critical. Not only is Picard seeking hundreds of millions of dollars, but according to the Times report, he has also alleged that Wilpon knew or should have known that Madoff was running a crooked scam. That’s why the trustee seeks many millions more than the $571 million he said the Wilpon companies withdrew.

“The really troublesome thing for Wilpon is Picard alleges that Wilpon knew or should have known,” the lawyer said. “That goes to Wilpon’s integrity and reputation. Wilpon is very vulnerable. He can’t let that suit go forward because the risk that he was culpable is too great.

“Picard has Wilpon by the tail and Wilpon knows it. Picard knows Wilpon can’t run the risk of a jury or a court decision against him.”

As we said last week, it’s going to be very difficult for Wilpon to have his cake and eat it too, meaning raising a significant amount of money AND still maintain control.

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Yu Darvish: The next great Yankee righthander?

Nippon Professional Baseball superstar Yu Darvish, a 24-year-old righthander who, by many accounts, is not only the best pitcher in Japan but may have the potential to become one of the best starting pitchers in Major League Baseball, recently took over the comment thread of our post looking at next offseason, as it’s expected the Yankees will be all over him when the Nippon Ham Fighters post him next winter. And if the Yankees really do want him, I wouldn’t be surprised if they did whatever it takes next winter. Between a rather uninspiring crop of free agent starters, as Continue reading Yu Darvish: The next great Yankee righthander?

J-Dusch joins the AL East … with the O’s

I’m slightly disappointed to announce that another potential rotation solution (not named Sergio Mitre) has been taken off the table. ESPN’s Jerry Crasnick reported last night that Justin Duchscherer has reached an agreement with the Orioles. The one year pact is worth as much as $4.5M in salary and incentives; however, only $700k is guaranteed. Apparently, the two finalists in the Duchscherer sweepstakes were the O’s and Nationals despite a plethora of teams showing interest early on. The general consensus among us here at Yankeeist was that he’d be a worthwhile investment so long as the price was cheap. Over Continue reading J-Dusch joins the AL East … with the O’s

Assessing Brian Cashman’s reign-Part 1 of 5

Brian Cashman has become something of a lightning rod this off season, drawing criticism from fans and media types for both his lack of activity and distancing himself from the Soriano deal. But he also has his defenders, and while appearing on Mike Silva’s radio show last night Mike cited a poll he ran where the voting came in 2/3 positive on Cashman. We all know GMs will have their share of good and bad moves, but who’s more right here? On balance, is he a good or bad GM? I wanted to take a look at what his track Continue reading Assessing Brian Cashman’s reign-Part 1 of 5

Assessing Brian Cashman's reign-Part 1 of 5

Brian Cashman has become something of a lightning rod this off season, drawing criticism from fans and media types for both his lack of activity and distancing himself from the Soriano deal. But he also has his defenders, and while appearing on Mike Silva’s radio show last night Mike cited a poll he ran where the voting came in 2/3 positive on Cashman. We all know GMs will have their share of good and bad moves, but who’s more right here? On balance, is he a good or bad GM? I wanted to take a look at what his track Continue reading Assessing Brian Cashman's reign-Part 1 of 5

TYU on NYBD

I’ll be appearing on Mike Silva’s New York Baseball Digest show tonight @ 8:30 PM. Topics will include Brian Cashman, and some of the recent goings on here at TYU. There may also be a conference call between me and Frank Russo, and while we’re both die-hard Yankee fans he comes at it from a very different perspective than I do, which could get ugly interesting. Give it a listen, Mike does a fun show really knows his NY Baseball. Click Here to listen live.

More mainstream love for the Yankee farm system

The New York Post’s Kevin Kernan is arguably one of the worst mainstream writers covering the Yankees today — and that’s saying a lot, considering the sheer volume of people competing for that particular honor — but he’s got a great piece up today about Dellin Betances, and it also features brief looks at some of the other promising names we’ve heard so much about this winter, including Manny Banuelos and Andrew Brackman (of course), as well as D.J. Mitchell, Hector Noesi, Ivan Nova, David Phelps and Adam Warren.