Frank McCourt has a “slush fund,” secret partners and pays his kids to do nothing

John Weinbach of FanHouse reports some more unseemliness from the land of Frank McCourt and the Dodgers:

Over the past 18 months, the Los Angeles Dodgers paid nearly $4 million in “consulting services” to [the John McCourt Company], an entity that has done virtually nothing for the club, even as the team has made a concerted effort to raise ticket prices, trim payroll and acquire players on the cheap. Moreover, the club paid two of Frank and Jamie McCourt’s adult sons large salaries -- $400,000 and $200,000 per year, respectively -- for services that are undefined and could not be described by either Frank or Jamie McCourt, according to court documents filed in the couple’s divorce case.

Jamie McCourt’s attorneys call the John McCourt company a “slush fund” which Frank uses to hide money. My guess is that she’s less critical of the big salaries her kids make for apparently do-nothing jobs.

In addition, there are apparently two limited partners in the Dodgers -- guys no one ever knew about, but who provided considerable funds to the McCourts to buy the team -- whose debt gets converted into “sizable equity” in the team if the McCourts default on the loans.

On the one hand this is shocking -- and Josh Fisher does his excellent-as-usual job breaking down all of the implications, complete with an apt comparison to the Texas Rangers, who are poster children for what happens when good teams go into bad debts like the McCourts seem to have done.

On the other hand, I would not be at all shocked if multiple teams in Major League Baseball operated in just the same way, complete with family jobs, slush funds, silent partners and all manner of vehicles which, either intentionally or by happy accident, work to conceal the amount of cash a baseball team really earns and where its money is spent. Baseball teams are almost all purely private companies, most of which are family owned. Despite their antitrust exemption and all of the tax money they consume in the form of public stadiums and the like, we know just as much about their operations as we do the corner gyro shop, and that’s just the way they like it.

The only difference here: we have a divorce case in which these machinations are laid bare. And however distressing it is for Dodgers fans to see where all the money that should be going towards starting pitching is going, these revelations are educational and useful.