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Trustee: Mets Owners Went 'Shopping' For Madoff Fraud Insurance

NEW YORK (CBSNewYork / AP) — A court-appointed trustee says the owners of the Mets reaped profits from Bernard Madoff's financial Ponzi scheme even as they went "shopping" for insurance to protect themselves in case the scam collapsed.

WCBS 880's Paul Murnane: Were The Mets In The Know?


Trustee Irving Picard says partners in Sterling Equities, which includes Saul Katz, Fred Wilpon and his son Jeff, contacted a broker to ask about insuring their account with Madoff in February 2001. In one handwritten note, court records say partner Arthur Friedman wrote the insurance should cover "fraud or fidelity" with the word "Ponzi" in parentheses. Picard filed the court documents Thursday.

"They didn't go shopping," Greg Nero, general counsel for Sterling, said according to the New York Daily News. "A trusted colleague made a recommendation about looking at insurance, so they spoke to an insurance salesman, received some basic information and they ultimately decided not to purchase it because they trusted Mr. Madoff - and believed that they did not need it."

Picard claims Sterling partners knew Madoff was stealing from new investors to pay off older investors. He wants them to repay $1 billion to Madoff's victims.

Sterling denies it knew about Madoff's wrongdoing. In a written statement, the group said there were no "red flags and they received no warnings."

The statement reads: "For months our reputations and our businesses have been subjected to the Trustee's false allegations, and today's filing recklessly rehashes the same fictitious claims.

"As the Partners have said all along, they did not know Bernie Madoff was engaged in a fraud. There were no red flags and they received no warnings. The Trustee's opposition papers filed today say nothing different. The only thing the Trustee has debunked is the veracity of his own story."

What do you think of the latest developments? Sound off in the comments below...

(TM and Copyright 2011 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2011 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

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