Nails for Nails?

by Todd Shriber

The story of Lenny Dykstra’s post-Major League Baseball career took an ugly turn for the worse recently when the player known to fans as “Nails” was indicted on 13 counts of bankruptcy fraud by the U.S. Attorney in a California.

Among Nails’ alleged transgressions are the following: bankruptcy fraud, obstruction of justice, four counts of concealing property from the bankruptcy estate, three counts of embezzlement from the bankruptcy estate, and four counts of making false declarations to bankruptcy court, CNN reported.

Dykstra’s financial misgivings are the result of the foreclosure on his California mansion that he purchased from hockey star Wayne Gretzky in 2007 for $17.5 million. As many less-than-high-profile folks have done in the financial crisis, Dykstra claimed he was the victim of mortgage fraud at the hands of Washington Mutual, which is now owned by JPMorgan Chase (JPM), according to CNBC.

The home was bought by Jeff Smith of Index Investors in 2010. Smith stated earlier this year that Dykstra, to whom Smith loaned a cool $600,000, had not repaid any of that cash or any of the interest on the loan, CNBC said.

Dykstra, a three-time All-Star with the New York Mets and Philadelphia Phillies, is no all-star when it comes to finances. Citing Dykstra’s bankruptcy filing, Bloomberg reported that Nails listed assets of $24.6 million and debt of $37.1 million, $12.9 million of which is owed to JPMorgan Chase.

In other words, Nails, who was an integral member of the 1986 Mets team that won the World Series, has had quite a fall from grace in recent years. In his 12 seasons playing professional, including one in which he finished second in the voting for the National League’s most valuable player award, Dykstra earned over $36.5 million in salary, according to Baseballreference.com.

That’s one statistic that makes Dykstra’s financial ineptitude look all the worse. Another is that he could face up to 80 years in jail if convicted on all the indicted charges.

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