Former Baseball Star Dykstra Charged With Fraud
 

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From Stan Wilson, CNN
April 15, 2011 6:42 p.m. EDT

Los Angeles (CNN) -- Three-time major league All-Star outfielder Lenny Dykstra, who amassed a fortune through financial advising, was charged Friday with bankruptcy fraud for allegedly removing and selling personal property from his $18 million mansion, which was part of the bankruptcy estate, officials announced.
The federal charges stem from a bankruptcy case that Dykstra filed on July 7, 2009. The criminal case, filed in U.S. District Court in Los Angeles, accuses Dykstra of removing, destroying and selling property that was part of the bankruptcy estate without the permission of the bankruptcy trustee.
According to court documents, after Dykstra filed for bankruptcy, he sold many items belonging to the estate for cash, as well as destroying and hiding other items. An attorney hired by the bankruptcy trustee estimated that Dykstra stole or destroyed more than $400,000 worth of property in the estate, according to the criminal complaint.
Dykstra, 48, was in jail Friday on an unrelated grand theft auto charge after being arrested Thursday night by Los Angeles Police. The former member of a New York Mets World Series champion team was being held on $500,000 bail, authorities said.
Dykstra is suspected of purchasing vehicles through fraudulent means, police said.
In his bankruptcy filing, Dykstra listed assets of $24.6 million and overall debts of $37.1 million.
Among the assets he listed two residences: a Ventura County mansion in Lake Sherwood Estates he had purchased from Janet and Wayne Gretzky that he estimated was worth $18.5 million, and a home in Westlake Village that he estimated was worth $5.4 million. As a result of the bankruptcy filing, the residences and Dykstra's personal property became part of the bankruptcy estate that would be used to pay off creditors.
Even though Dykstra was prohibited from liquidating any part of the estate, authorities say he admitted in a bankruptcy hearing that he arranged the sale of sports memorabilia and furniture that were part of the estate, the complaint alleges.
Dykstra also is accused of confiscating a $50,000 custom sink and receiving cash at a Los Angeles consignment store for other personal items and fixtures taken from the mansion, according to the complaint.
Dykstra's professional baseball career began in 1985 when he was drafted by the New York Mets at the age of 22. A year later, Dykstra hit a lead-off home run in Game 3 of the World Series at Fenway Park after the Mets had lost the first two games. That spark rallied the Mets to a seven-game victory over the Boston Red Sox.
He was traded in 1989 to Philadelphia, where the rest of his career was marked by successes as well as injuries, brawls and allegations of steroid use that he has denied. He earned the nickname "Nails" for his tenacity and confrontations on the field. During his last outstanding season in 1993, Dykstra set a major league record with 773 plate appearances and led the National League in at-bats, walks, hits and runs. The Phillies that year advanced to the World Series, which they lost to the Toronto Blue Jays.
By the time he retired, Dykstra had earned $36.5 million from major league baseball, according to Baseball-Reference.com. His last season was 1996.
After retirement, Dykstra moved to California and started a profitable luxury car wash that he called The Taj Mahal. He expanded the business throughout Southern California and in 2007 sold it to investors, according to bankruptcy filings.
As a self-taught financial analyst, Dykstra proclaimed himself a financial guru and began writing a stock-picking website column. His prominence soared as a sports celebrity, entrepreneur and popular guest on numerous financial news broadcasts. In 2008, Dykstra began publishing the Players Club, a glossy financial advice magazine exclusively for pro athletes to help them with wealth management and investment banking.
His purchase of the palatial Gretzy estate in 2007 for $14 million occurred a few months before the mortgage market collapse. By the time Dykstra filed for bankruptcy in July 2009, he had accumulated loans totaling $21 million, bankruptcy records show.
The bankruptcy case is still ongoing. Dykstra has listed his only income as a $5,700 monthly pension from Major League Baseball, records show. He is expected to be arraigned on the federal charges Monday. He would face a maximum of five years in federal prison if convicted.
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