Mets’ Madoff settlement shrinks
The money owed by Mets ownership to the trustee who is recovering money for victims of Bernard Madoff’s ponzi scheme has dropped to a shade over $75 million from the original amount owed of $162 million.
Writes Adam Rubin of ESPN New York:
"Eligible victims of the Ponzi scheme now have recovered 48.802 cents for every dollar of principal they lost in the Madoff affair.The Wilpons, like other victims, can deduct the 48.802 cents per dollar from their lost funds from the $162 million eventually owed to the trustee.Here’s the math:$162 million owed, minus 48.802 percent of $178 million lost, yields the actual payback to the trustee."
Rubin further notes that as the trustee continues to recover funds, the money owed by Mets’ ownership should continue to dwindle.
At present, the Mets would owe $75,132,440, due to be paid back in two installments in 2016 and 2017.
In 2009, the season after Madoff’s ponzi scheme collapsed, the Mets’ payroll was a tick over $149 million.
However, in 2012, the season after Fred Wilpon was named in the lawsuit by Irving Picard – who was retrieving funds for Madoff’s victims – the Mets’ payroll dropped from $143 million to $95 million.
That payroll drop came on the heels of the Mets receiving a $25 million dollar loan from Major League Baseball and a $40 million dollar loan from Bank of America.
Since then, the payroll has dipped to $94 million in 2013 and $85 million in 2014.
If the Mets make no further additions or subtractions this offseason, they’ll enter the 2015 season with a payroll a bit over $95 million. That would represent the first year-to-year increase since Wilpon was named in the Madoff lawsuit.
While it’s a positive that the money owed by the Mets to the Madoff trustee is continuing to shrink, the Mets still have to pay back their loans to both Major League Baseball and Bank of America.
And even though the hit Mets ownership will take from their investments with Madoff will likely be a fraction of the original settlement, the club continues to operate like a mid-market team while playing in the largest market in the country.
Other teams are taking on huge contracts via free agency and trade. Other teams are preparing to spend $60 million on 19-year-old Cuban infielder Yoan Moncada. Meanwhile, it appears the Mets are still struggling to keep their heads above water financially.
Hopefully, the Mets’ expected contention in 2015 will provide additional revenue that will give them the wiggle room necessary to improve the team further while paying back the money owed in both 2016 and 2017.
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