Fred Wilpon has insisted since 2008 that the Bernie Madoff mess had little impact on the Mets’ baseball operations. Even since last week, when it was announced that he would have to sell part of the team due to the Madoff losses, the sense has been that they are exclusively personal losses and that since the team is the Wilpons’ largest asset it was logical that he turn to the team for his capital needs.
There’s an article in today’s New York Times, however, which tells a far different story: Bernie Madoff and his investments were deeply involved in the Mets, and the Mets operations were highly dependent on Bernie Madoff:
When the Mets negotiated their larger contracts with star players — complex deals with signing bonuses and performance incentives — they sometimes adopted the strategy of placing deferred money owed the players with Mr. Madoff’s investment firm. They would have to pay the player, but the owners of the club would be able to make money for themselves in the meantime. There never seemed to be much doubt about that, according to several people with knowledge of the arrangements.
“Bernie was part of the business plan for the Mets,” a former employee of the club said … interviews with current and former associates of Mr. Wilpon and Mr. Katz, as well as former employees of the club, former employees of Mr. Madoff and others, make it clear that the relationship was substantial and that the role Mr. Madoff played in the financial life of the ball club and the Wilpon and Katz families was pervasive.
The more damning part of the article, however, involves the way that the Wilpons would steer friends and even Mets employees to Madoff investments. Indeed, former Mets GM Frank Cashen says that his deferred compensation package after leaving the Mets was invested with Madoff. He was paid before the bottom fell out, but
he says that Wilpon and Madoff worked “in unison” he says that Wilpon and his partner Saul Katz worked “in unison” to push Mets employees to invest in Madoff securities. That famous Bobby Bonilla deferred money deal was also invested with Madoff. Madoff also reportedly got many of his investors via introductions from Fred Wilpon, who the bankruptcy trustee suing him alleged knew or should have known that Madoff was a scam artist.
If what the many sources of this article say is true, the Wilpons are more than the victims they’ve made themselves out to be. They were an important part of Madoff’s operation, whether they themselves knew the nature of the operation or whether they simply placed stupid blind faith in their close friend.
And there is no question that, by virtue of placing team-related investments with Madoff, the financial prospects of the Mets — and not just the Wilpons — was deeply harmed as a result.