Saul Katz called it the Madoff “vig.”
Vig, or vigorish, is a gambling term, meaning the money a bookmaker collects on every bet taken, regardless of the outcome — a kind of dependable handling fee.
To the court-appointed trustee suing Katz and Fred Wilpon, the owners of the Mets, the Madoff “vig” was, quite simply, evidence of the men’s implausibly unyielding faith in Bernard L. Madoff’s steady investment returns, and the men’s dependence on those returns to help finance their businesses and deepen their personal wealth.
The trustee, Irving H. Picard, asserts that Katz and Wilpon took out bank loans just to invest the borrowed money with Madoff, confident that their returns would be better than the interest on the loan. That was the vig at work.
Katz and Wilpon, according to the trustee, structured player contracts to draw out the timing of their payments. They would then invest the money they owed the players with Madoff and make a profit across the many years of the contract payments. That, too, was the vig. ...
Finally, instead of paying disability insurance premiums for key players on the team, the trustee says, Katz and Wilpon put the money into an account — called “Saul’s cookie jar” — to pay injured players. That, as well, was the vig. ...
The vig was described by David Katz, one of Saul’s sons, during a sworn deposition in late 2010 when he was questioned about one way that the family company, Sterling Equities, made money with Madoff.
“You borrow money at 5 percent and you’d make 10 percent,” David Katz said. “You’d make a ‘vig,’ as my father would say, on the Bernie investment.”
The lawyer deposing Katz, according to a transcript of the proceeding, briefly appeared confused by the term.
“You’d make a vague?” the lawyer asked.
Katz said, “Vig, vig, vigorish.”
“Oh, vig, as in v-i. ...,” the lawyer responded.
Katz said: “Oh, don’t even ask. Sorry.”
Posted: February 21, 2012 at 12:12 AM | 4 comment(s)
Login to Bookmark