Former Major Leaguer Dykstra Nailed for Bankruptcy Fraud

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Published April 15, 2011

| FOXBusiness

Federal authorities on Friday accused former baseball star Lenny "Nails" Dykstra of committing bankruptcy fraud, alleging the athlete-turned-stock picker illegally sold items from his $18 million California mansion.

Separately, Dykstra, 48, was arrested Thursday night by the Los Angeles Police Department on Grand Theft charges for suspicion of buying vehicles through fraudulent means.

The legal headaches are mounting for Dykstra, who the Department of Justice alleges removed, destroyed and sold property that was part of his bankruptcy estate without consent from the bankruptcy trustee. Dykstra filed for bankruptcy in July 2009, listing his $18.5 million mansion in Lake Sherwood Estates that was purchased from hockey great Wayne Gretzky as well as a Westlake Village residence valued at $5.4 million.

An attorney for the trustee estimates Dykstra sold and destroyed more than $400,000 worth of property in the estate, the criminal complaint says.

Authorities say Dykstra, a former outfielder for the New York Mets and Philadelphia Phillies, sold many items for cash on eBay (EBAY) and Craigslist.

One such item was a $50,000 sink that Dykstra “ripped out” of his mansion, the complaint says. Dykstra allegedly took granite from the mansion and installed it in an office he set up at the Camarillo airport after he filed for bankruptcy.

The indictment says Dykstra was paid cash for personal items, including a “truckload of furnishings and fixtures” from his mansion. Dykstra also apparently admitted in a bankruptcy hearing to arranging the sale of sports memorabilia and a dresser that were the property of the estate.

Since retiring from the Phillies in 1996, Dykstra has gained attention for his work as a stock picker and frequently appearing in the financial media, including on FOX Business.

According to the DOJ, Dykstra was arrested at around 8pm local time on April 14 in Encino, Calif. on Grand Theft charges. He was booked and held on $500,000 bail.

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