Minnesotans are about to become business partners with Zygi Wilf, to the tune of half a billion dollars.  To get the partnership structured correctly, part of our due diligence process should be to ask past Mr. Wilf’s past business partners what they would do if they were us.

For instance, we should consult with Josef Halpern and his sister Ada Reichman, who the court says were defrauded by their business partner Zygi Wilf.  What advice would Halpern and Reichman give Minnesotans on the eve of our business partnership with the Wilfs?

My guess is that Halpern and Reichman wouldn’t be at all focused on ability-to-pay, which seems to be the primary, if not sole, concern of the Minnesota Sports Facitilies Authority (MSFA) and the reporters covering this issue.  Minnesotans seem to be learning the wrong lesson from the New Jersey case.  After all, ability-to-pay falsification wasn’t the flavor of fraud the Wilfs served up to Halpern.  Having money wasn’t the Wilf’s problem in the New Jersey case; sharing it was.

As  Judge Deanne Wilson said, Mr. Wilf’s own testimony showed that he had “reneged” on the agreement with Reichmann and Halpern because he decided that they got “too good a deal.”  The judge also said “I do not believe I have seen one single financial statement that is true and accurate.”

So, what if the Wilf’s decide Minnesotans got “too good a deal?”  Will Minnesotans get the Halpern-Reichman treatment?

Given the Halpern-Reichman experience, I doubt very much that their advice to us would be “make sure they have enough money.”  It would more likely be “protect yourself.”

You can bet that Halpern and Reichman wish they had written a stronger accountability provisions into their contract, and regular audits reinforced with stiff fines for falsification.  You can bet that they wish they had made the Wilfs regularly disclose everything about the operation of the partnership, so that the financial funny business could have been discovered sooner rather than later.

Actually, what Halpern and Reichman probably would advise Minnesotans is to avoid partnering with the Wilf’s at all costs.  But since that doesn’t seem to be in the political winds at this stage, the MSFA should do what the Wilf-defrauded partners would surely do if they had it to do over again:  Don’t trust, verify.

– Loveland