Great Minds Think Alike...

Posted by Sean Doyle, June 28, 2010

Photo Courtesy of Life.com (Jamie McCarthy/ WireImage)

Uh-oh!! Lenny "Nails" Dykstra, the financial "genius" whose only remaining personal asset is a $10,000 dollar German shepherd following a massive and embarrassing bankruptcy, is in trouble yet again. Turns out the ex-slugger was paid for pumping stocks on his bff Jim Cramer's website TheStreet.com. This is all according to author Randall Lane in his book The Zeroes: My Misadventures In The Decade Wall Street Went Insane. Lane alleges Dykstra was given $250,000 worth of secretly issued stock in return for the pumping of that same stock to TheStreet.com's unwitting subscribers.

Let's face it, Lenny was a helluva hard nosed ballplayer in the mold of Pete Rose. (In fact, he was Pete Rose on steroids...literally). But a financial genius he was not. Cramer created this financial savant mythology with his constant pumping of Dykstra's stock picking ability. The truth is "Nails" was a big name, a likable mumbling celebrity hybrid who could appeal to the everyman. Dykstra was like a lot of TheStreet.com's everyday subscribers for which stockpicking and day trading were secondary careers or hobby rather than full time vocation. He was thus a perfect pitchman for the budding empire Jim Cramer was building for the so-called "retail" investor with himself, James J. Cramerious The Bold as benign (re: mad) Emperor.

Photo Courtesy of Brad Trent.

Back to the front...

The stock in question was a small cap named Automated Vending Technologies (AVTC.PK). According to Randall Lane, AVTC's founder Shannon Illingworth gave Dykstra $250,000 of AVTC stock (secretly putting it in the name of Lenny's brother-in-law) in exchange for the pumping of said stock on Dykstra's newsletter for TheStreet.com.

The real question remains unanswered. Mainly, will any of this damn dirty Dykstra business come back to haunt Captain Cramerica, the Mad Emperor of all financial media? Or will Cramer's well worn teflon coat beat back yet another scandal?

Read The Full Story Here: The Daily Beast: Jim Cramer Stock Touting Scandal.