Mark Walter’s sports empire made him one of the most recognizable owners in American sports. His financial empire was considerably less visible, even though it was hiding in plain sight. But recent developments now have the business mogul facing scrutiny over the financial machinery behind his sports empire, raising much bigger questions about the entire private credit sector.
Walter, the controlling owner of the Dodgers and until recently the majority owner of the Lakers, is at the center of a Securities and Exchange Commission investigation, according to regulatory filings first reported on by Bloomberg in July.
The probe is looking into whether companies tied to his financial empire improperly handled billions of dollars in loans from insurance companies that he separately controls. No criminal charges have been filed against Walter, and the investigation does not allege that the Dodgers or Lakers committed wrongdoing. However, more than $1.2 billion of the financing for Walter’s purchase of the LA Dodgers came from insurance companies controlled by Walter through Guggenheim, according to a breakdown of the transaction by the Los Angeles Times.
Walter did not respond to a request for comment from Fortune. Guggenheim Partners declined to comment.
