Keidel: Mets’ Moneyball
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By Jason Keidel
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With the sun beaming on baseball again, the slumber of last season replaced by new players on new teams jogging leisurely to the tune of whispering palm trees and sunsets over western cacti, hope springs it annual leak for most MLB clubs.
Except in Queens, where the sun rarely rises. And thus it’s time to feed Fred Wilpon’s gorilla, nearly the size of King Kong, squatting in his living room.
A recent report in The New York Times introduces a new actor in the Mets’ drama, starring the Wilpon/Madoff/Picard triumvirate.
It seems that Sterling Equities wasn’t, well, so sterling over the last decade, at least. And while Mets ownership demands its innocence, it also declares amnesia over dealing with a woman named Noreen Harrington, who looked at Bernard Madoff’s profits back in 2003 and didn’t like what she saw. She could be the cog that derails any notion that the New York Metropolitans were unaware of foul play with the appalling, imprisoned Ponzi king.
According to the article, Ms. Harrington – a Goldman Sachs executive who ran a hedge fund owned in part by Mets ownership – confronted Saul Katz, Wilpon’s partner and co-owner of the Mets, about the numbers sprouting from Madoff’s spread sheets. Putting it bluntly, she essentially said there’s no way anyone could make that kind of profit all the time. And according to Harrington, Katz became indignant over her assertions, lecturing her rather than investigating Madoff, whom he told Harrington was a longtime and trustworthy friend.
How’s that going?
This was back in ‘03, which means for many years the Mets did business with Madoff after Harrington’s accusations. “Fiction” is the term she used to describe Madoff’s monetary gains.
And when she suggested to Katz that Madoff could be stealing in order to feed his profits, she said Katz got visibly angry. And when Harrington said she couldn’t continue in her current capacity if Madoff were a main source of income, Katz ignored her. So she quit.
She also asked to look at Madoff’s books independently but was “rebuffed with disdain” according to the article written by Richard Sandomir. “You don’t get it, do you?” Harrington said she was told by a big wig at the hedge fund who steered clients to Madoff. “This is a privilege. You don’t get to ask questions.”
How’s that going?
For folks who claim systemic innocence and transparency, the men who run the Mets have been awfully delicate and defensive over Madoff. If there’s nothing to hide, then why hide? It reminds me of a great line by Ricky Roma (played by Al Pacino), who once said, “Tell them the truth. It’s the easiest thing to remember.”
If Irving Picard, the attorney trying to recoup millions for Madoff’s victims, can find a few more Harringtons and, worse, even get Grandma on the stand to sing her sorrows about being gutted by Madoff’s greed, being forced to sell her dream house to move into a one-bedroom box of an apartment, eating canned goods instead of red snapper for dinner…well, let’s just say the suits at Sterling will be cracking open their checkbooks before the jurors are done deliberating. Defiant to the end, Fred Wilpon and Saul Katz have claimed they knew nothing of Madoff’s malfeasance, refusing to cut a deal, to settle out of court.
Unless Wilpon has an unseen ace up his sleeve, it will be tough to imagine him garnering any sympathy from a jury of much poorer peers who hear about private planes and nine-digit bank accounts while the regular folks forked over their pension plans into Madoff’s toxic, financial wasteland. Indeed, it doesn’t take a wizardly financial chef like Warren Buffet to smell the pungent books Madoff cooked.
In fairness, Ms. Harrington said she provided no physical proof to Katz that Madoff was stealing. (Though it’s hard to do when she’s denied access to his records.) But surely her cynicism didn’t appear in a vacuum, and we need to remember that the standard for proving guilt in a civil suit is far more relaxed than a criminal case. Picard only needs to provide a preponderance of evidence to prove Wilpon and Katz’s guilt. I’m not an attorney (nor do I play one on television) but it doesn’t take Vincent Bugliosi to know that dismissing the suspicions of Ms. Harrington – who has two decades of big-time finance under her belt with Goldman Sachs, Barclays Capital, and M.D. Sass – is probably poor form and could be quite costly.
Picard will no doubt remind the courtroom that Wilpon, Katz, and their entourage arrive in towns by limo and Learjet, some of which, Picard will argue, was fueled and financed by Madoff. And while being rich doesn’t mean you’re guilty, playing the have and have-not card could resonate with a jury.
And let’s not forget who pays Wilpon’s bills – you, the fan. So even if you’re inclined to forgive Fred for the Madoff transgressions, dismiss the charges and declare that he was duped like the rest of Madoff’s victims, you’ve got a terrible team waiting for you on Opening Day.
Beyond the posturing and poor publicity that comes with all things Ponzi, Sandy Alderson shaved – heck, purged and blasted– payroll by $50 million, the largest single-season fire sale in MLB history. Do you think it’s just a coincidence he did this on the heels of the lawsuit? You don’t think Sandy is doing this under direct orders from his bosses? It’s hard for an objective baseball man to argue that letting homegrown hero Jose Reyes walk was good business.
If the Yankees are the emblem of excess and avarice, Gordon Gekko gone wild, then the Mets are the dark side of that coin, lunging for the quick score without doing due diligence on the man upon whom they heaved a few hundred million quid.
Then they want you to spend thousands of your legally obtained bucks for courtside seats. And I’m quite sure the more prudent among you are watching ringside in civil court before you drop your dollars on a sub par baseball team.
No one questions Alderson’s bona fides as a baseball man. But if he, beyond cutting spending, is charged with selling you the idea that New York City is the natural province of a paltry payroll and small market team, then he can’t win. It’s an impossible sell, particularly juxtaposed with that juggernaut in the Bronx. With his comments this week, Alderson essentially raised the semantic white flag before the season has begun.
It says here that the Mets are in grave danger, springing leaks faster than they can plug them. Besides the chasmal gaps in their club, they’ve also scrambled for minority investors for cash flow purposes. But who would want to buy the entire franchise at proper market value, especially now that it doubles as a public piñata? And if the Metropolitans don’t draw at least 2 million fans – they drew just 2.3 million last year before Reyes, their most popular player and NL batting champion, moved to Miami – it may be time to nudge the Wilpons near the door, with or without their permission.
Bud Selig isn’t inclined to boot a friend from the owner’s box, but he got involved with the Dodgers on the basis of financial woes. Depending on how things go against Picard, the Mets might not give MLB much choice but to at least investigate the possibility of taking the team from Fred Wilpon and Saul Katz.
Fred Wilpon’s obstinacy could cost him more than money, extra commas in the checking column. Could it cost him the Mets?
Your thoughts on the Mets’ financial woes? Sound off below…