According to a news release from the FBI, Dykstra, 48, was taken into custody at his home in Encino.
Dykstra, who played for the World Series champion 1986 New YorkMets, is charged with one count of embezzling from a bankruptcy estate.
It all stems from a bankruptcy case that Dykstra filed on July 7, 2009.
After his major league career ended, Lenny Dykstra became a businessman, first with a luxury car wash, which he expanded and then sold to investors in 2007. Dykstra also taught himself financial analysis, began trading and writing about the stock market.
As the market went south, Dykstra went broke.
According to court documents, after Dykstra filed for bankruptcy, he sold many items belonging to the bankruptcy estate for cash, as well as destroying and hiding other items.
An attorney hired by the bankruptcy trustee estimates that Dykstra stole and destroyed more than $400,000 worth of property in the estate, according to the criminal complaint.
When Dykstra filed for bankruptcy, he listed two residences - a mansion in Lake Sherwood Estates purchased from Janet and Wayne Gretzky that he estimated was worth $18.5 million, and a home in Westlake Village that he estimated was worth $5.4 million.
As a result of the bankruptcy filing, the residences and Dykstra's personal property became part of the bankruptcy estate that would be used to pay off creditors.
The FBI alleges that Dykstra:
-was paid cash at a Los Angeles consignment store for personal items, including a truckload of furnishings and fixtures that he had taken from the Lake Sherwood mansion
- admitted in a bankruptcy hearing to having arranged the sale of sports memorabilia and a dresser that were property of the bankruptcy estate
- "ripped out" a $50,000 sink from his mansion and took granite from the mansion and installed it in an office he set up at the Camarillo airport after he had filed for bankruptcy protection.
The charge of bankruptcy fraud carries a statutory maximum sentence of five years in federal prison.