It's one thing to refer or introduce family, friends and associates to an investment adviser.  It's another thing to provide the conduit to such an investment adviser, provided the invitee agreed to comply with odd and puzzling terms and conditions that restricted direct contact with or questioning of the adviser.

But that's just what happened with investors who were invited by Mets owners Fred Wilpon and Saul Katz to invest with the Bernie Madoff, the "maestro of returns that consistently outperformed the markets."  Yes, Sterling Equities, the family company that owns the Mets, would administer all the referred accounts and handle the transactions between the investors and Mr. Madoff’s firm.

    Members of the Sterling Equities Feeder Fund.   Those invited into this exclusive club included:  (i) relatives of Sterling management; (ii) an investment banker who is also a supper club entertainer;  (iii) a technology entrepreneur; (iv) a theater industry executive;  (v) Hall of Famer Sandy Koufax;  (vi) TV Host Larry King;  (vii) former NYMet baseball player Tim Teufel;  and others - some 500 to be exact.

Instead of sending money to Bernie Madoff, funds were filtered through the Sterling partner and the Mets board member Arthur Friedman, a CPA with a law degree who served as the liaison to Bernie Madoff’s operation.  By the time Madoff was arrested in December 2008, Mr. Friedman had managed 178 Madoff accounts opened for friends and close business acquaintances of the Sterling partners, and for some Sterling employees. Add another 305 Madoff accounts set up by Sterling partners for themselves, their families, trusts and Sterling-related entities that Mr. Friedman also administered.

    Insisting Their Innocence.   Madoff trustee Irving Picard trustee charged in a lawsuit that Fred Wilpon and Saul Katz willfully ignored repeated signs that Bernie Madoff’s enterprise was suspect.  That investors weren't permitted to contact Mr. Madoff is portrayed in the suit as an intentional and fairly elaborate way to erect a barrier between these individuals and him.

Yet, Wilpon and brother-in-law Katz insist that neither they nor their executives have done anything wrong and describe themselves as honest and longtime - albeit naïve - investors with Madoff.  They were also duped by his Ponzi scheme, which long eluded federal regulators.  Bringing relatives and friends into the Madoff investment circle, they contend, is further evidence that they were unaware.

    Now, A Word From The Great Silent One, Sandy Koufax.   On Saturday, Sandy Koufax, Hall of Fame pitcher who was introduced to Madoff by Wilpon, his longtime friend, said he didn't consider himself a victim of the scam because the only money he lost was to the IRS in taxes, which he got back.  Mr. Koufax said that he was not being sued by the trustee, as Mr. Wilpon and Tim Teufel, the Mets’ Class AAA manager in Buffalo, are.  Mr. Koufax expressed his support for Mr. Wilpon, saying that he believed that if Mr. Wilpon had known that investing with Mr. Madoff was not sound, he would not have told him to do so. Mr. Teufel also stood up for Mr. Wilpon, saying he could relate to the anguish that the Wilpon family was experiencing.

[C-I Note:  Unfortunately, Koufax should have remained silent.]

For the full story, go to:   [NYTimes, 2/21, "Mets’ Owners Guarded an Investment Pipeline"]