The revelations last week that Fred and Jeff Wilpon made money on the Bernie Madoff ponzi scheme is getting more interesting by the minute.In a story that hit New York on Friday, the Wilpons failed to come to a settlement with a trustee from the Bernie Madoff party, who is trying to reclaim the henchman's losses, could face a lawsuit that will cost them $1 billion.
The trustee is suing the Mets for pulling out $300 million before the firm collapsed in 2008. Talk about inside information. The Mets knew what was going on, and it will cost them dearly. The lawsuit seeks to recover every penny the Wilpons and Sterlings Equities put into accounts with Madoff.
But don't think that the Wilpons are the victims here, because they are not:
"Sterling Partners knew, or should have known that Madoff's consistently high and extremely non-volatile returns over almost a quarter-century were 'too good to be true' because they were at odds with the strategy Madoff purported to employ," the suit said. "Sterling partners knew or should have known that with every withdrawal from their [Madoff] accounts they reaped the benefits of a fraud. " New York Post.
As a result of Fred Wilpon's stuborn trust of Madoff, he has watched the value of his baseball team, his network and company take huge hits. The Wilpons owe $430 million in dept, for a team that cost roughly $860 million. He is also due to pay $700 million in construction costs on Citi Field, with $50 million annually in lieu of taxes, and SNY, the Mets television network is making $100 million a year after paying $20 million in interest on $450 million on loans, which Wilpon apparently can't keep up with.
That is why the Mets want the new minority owner to pay up $200 million; they hope and believe that it will go a long way in helping them curb their dept problems. However, selling only 25% of their shares, while still holding all of the chips on SNY, the Mets, Sterling Equities, and Citi Field is becoming an enormous feat for them.
In total the Wilpons are $1.58 billion in debt. They can't hold onto this franchise any longer. The Wilpons have to sell this franchise. They have watched their financial situation drag the baseball team down into the abyss. The Mets can't even afford to add players to the roster, and are choking on bad contracts also dished out by the Wilpons.
If the Wilpons truly love this team they are going to have to do the hard thing and bid it adieu, and sell it to someone who can afford to put money into the product on the field.
I am sure that the Mets were Fred's gift to his son Jeff, and Jeff's gift to his own children at some point, but there aren't the Steinbrenner's who know how to spend money and where to invest it. The Wilpons have no clue about handling money, just look at the contract of Oliver Perez for an example.
The sooner the Wilpons go, the better for the Mets.
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