Back in 2006, the Nationals gave a $1.4 million signing bonus to 16-year-old Dominican shortstop Esmailyn Gonzalez. A few years later, Sports Illustrated revealed the truth: Esmailyn Gonzalez was actually Carlos Alvarez Lugo, and he was four years older than advertised. Whoops.
The Nationals fired two employees they believed were in on the scam: Dominican Republic instructor Jose Baez, and special assistant (and former MLB all-star) Jose Rijo. (They also fired GM Jim Bowden, after MLB launched an investigation into whether he was skimming prospects' bonuses.)
Now the Nats have filed suit to recoup part of Gonzalez's/Alvarez's signing bonus. They're suing an insurance company with which they had a $1 million policy protecting against employee fraud, alleging that Westchester Fire Insurance Co. failed to promptly investigate the claim, and unfairly denied it.
"Had they known Lugo's true age and identity at the time, more likely than not, the Nationals would have paid Lugo no bonus at all," the suit reads. "The $1.4 million signing bonus thus represented a complete loss resulting from the employee dishonesty, theft and fraud of Rijo, Baez and Lugo."
Gonzalez/Alvarez is 27 years old now, and has never made it higher than A-ball.