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Former baseball star Lenny Dykstra sentenced in federal bankruptcy case

From Stan Wilson, CNN
updated 9:54 AM EST, Tue December 4, 2012
Lenny Dykstra led the New York Mets to a World Series championship in 1986.
Lenny Dykstra led the New York Mets to a World Series championship in 1986.
STORY HIGHLIGHTS
  • Former Mets star amassed fortune playing baseball and investing in stocks
  • He had faced up to 20 years but pleaded guilty to three felonies
  • Dykstra admitted he had sold items from his mansion after creditors seized property
  • He was already in prison, serving a three-year sentence for another crime

(CNN) -- Lenny Dykstra, the former New York Mets outfielder who became a successful self-taught investor, was sentenced Monday to 6 1/2 months in federal custody following bankruptcy fraud and other federal charges, authorities announced Monday.

Dykstra, 49, faced 20 years in prison but prosecutors recommended 2 1/2 years following his guilty plea to three felony counts -- bankruptcy fraud, concealment of assets and money laundering, according to U.S. Attorney spokesman Thom Mrozek.

Dykstra is already serving a three-year state prison sentence after pleading no contest in July to grand theft auto in a separate case.

The federal indictment stemmed from a bankruptcy case that Dykstra filed on July 7, 2009. Dykstra was accused of removing, destroying and selling property that was part of the bankruptcy estate without the permission of the bankruptcy trustee.

In the bankruptcy filing, Dykstra had listed assets of $24.6 million and overall debts of $37.1 million. Among the assets listed were two residences: a Ventura County mansion in Lake Sherwood Estates he had purchased from hockey legend Wayne Gretzky valued at $18.5 million, and a home in Westlake Village that he estimated was worth $5.4 million.

During his financial turmoil, Dykstra's personal property became part of the bankruptcy estate that would be used to pay off creditors.

In his guilty plea in July, Dykstra specifically admitted he committed bankruptcy fraud by lying about whether he had taken and sold items from his $18 million Sherwood mansion after creditors seized the property. Dykstra also admitted that there were at least 10 creditors who were victims of his crimes, and those victims each lost between $200,000 and $400,000.

Dykstra, who was nicknamed "Nails" for his all-out playing style, was a key member of the New York Mets team that won the 1986 World Series. By the time he retired after 12 seasons, he had earned at least $36.5 million while a major leaguer, according to Baseball-Reference.com.

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.

Former baseball star makes plea deal in auto thefts

But Dykstra seemed to lose control of his extravagant jet-setting lifestyle during the housing bust.

When Dykstra filed for bankruptcy in 2009, his only income was a $5,700 monthly pension from Major League Baseball, records show. As part of the federal sentence, U.S. District Judge Dean Pregerson ordered Dykstra to perform 500 hours of community service and pay $200,000 in restitution.

He also was sentenced earlier this year to nine months in jail after pleading no contest to charged of indecent exposure to women he met through Craigslist.

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