A partnership connected to Sterling Equities, the owner of the New York Mets, took out over $45 million more than it invested in Bernard Madoff's scheme, making it ineligible for any compensation, a bankruptcy trustee disclosed Friday.
In papers filed in Manhattan bankruptcy court, trustee Irving Picard listed the Mets Limited Partnership as having two accounts with Madoff by the time his business went bust in December 2008. Madoff's books and records showed both accounts purportedly had about $830,000 in combined balances as of Nov. 30, 2008, the date of the last statements he sent clients.
However, over the years Mets Limited Partnership deposited in the two accounts a total of $522.7 million and withdrew about $570.5 million, court papers state. Because the partnership withdrew $45 million more than was deposited, Picard will consider it a "net winner" and ineligible for compensation from the Securities Investor Protection Corporation, or any customer funds he finds.
The general partner of the Mets Limited Partnership is a company formed in the late 1980s and state incorporation records list Fred Wilpon, chairman of Sterling Equities, as its chairman. Earlier court filings also gave Sterling offices as a mailing address for the general partner which managed the limited partnership.
The precise role the Mets Limited Partnership may play in the ownership of the baseball team is unclear. A spokesman for Sterling Equities couldn't be reached for comment late Friday.
Picard disclosed the Mets Limited Partnership interest along with a sample of other Madoff accounts in connection with litigation over the trustee's method of calculating customer losses.
Picard maintains Madoff's last statement to customers were bogus and shouldn't be used. He also believes net winners, like the partnership, got out more money than they put in, essentially getting money taken by Madoff from other customers.
But a number of customers, like the Mets partnership, are disputing Picard's denial of their claims. They believe Picard's calculations are in violation of laws establishing SIPC.
The Mets partnership net winning status listed in court papers indicates Sterling Equities may not have been financially hurt to the extent some news media reports speculated earlier in the Madoff scandal. There were numerous listings for Sterling and its related entities on a mailing list taking from Madoff's files earlier in the year, indicating many accounts.