Saturday, April 30, 2011

McCourt Strikes Out, Ponzi Hits A Homer

Another full house at Philadelphia's Citizens Bank Park
Major League baseball teams are not merely businesses like fast-food franchises or car washes. They are, in most cities, deeply important parts of the social fabric. My children, for example, are the fifth generation of my family to attend Philadelphia Phillies games.

Even as the go-go economy has swooned, attendance at most Major League ballparks has remained robust. Philadelphia has been among the hardest hit Rust Belt cities, but the Phillies have sold out every game for two straight seasons and 2011 is certain to be the third.

Team owners have not been immune from the vicissitudes of the economy, but in at least two cases their use of team revenues as funny money has drawn fan anger and concern from the mahoffs who run the American and National Leagues.

The Los Angeles Dodgers, one of MLB's marquis franchises, have been taken over by an overseer appointed by Commissioner Bud Selig because owner Frank McCourt, a Boston real estate developer, has saddled the team with $400 million since buying it in 2004 while enriching himself.

One consequence of McCourt's profligacy is that security at Dodgers Stadium has been cut back. Earlier this month, a San Francisco Giants fans was severely beaten in a stadium parking lot and McCourt has conceded to there is a lack of adequate security.

Meanwhile, the owners of the New York Mets are seeking minority investors as they brace for losses from a lawsuit brought by Irving Picard, the trustee who is representing victims of Bernard Madoff’s Ponzi scheme.

Fred Wilpon, chairman of the Mets, controls Sterling Equities, an investment company that fed more than $522 million into Madoff accounts over the years and took even more out of them.

Picard is seeking so-called clawbacks from those who withdrew more from Madoff accounts than they put in, and Wilpon and his son Jeff have been identified as likely targets.

The bottom line is the Mets, which are (again) as bad on the field as their crosstown rivals the Yankees are good, are broke.

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