Billionaire Mark Walter spent years quietly building an empire that stretches from insurance and finance to some of the world’s most valuable sports teams. Now, federal investigators are scrutinizing parts of his sprawling business network, and the sale of one marquee franchise — the Los Angeles Lakers — has prompted concern that it’s the first of perhaps several Walter-owned sports dominos to fall.Walter is CEO of Guggenheim Partners and TWG Global, a holding company with investments that span sports, entertainment, technology and artificial intelligence. He has a personal net worth estimated at $18.3 billion, according to the Bloomberg Billionaires Index.Walter’s first foray into sports was purchasing MLB’s Los Angeles Dodgers in 2012. Since then, his sports portfolio has grown to include Chelsea FC, the WNBA’s Los Angeles Sparks, the Professional Women’s Hockey League, Cadillac F1 and the Billie Jean King Cup and, until last week, the Lakers.As the federal probe continues, here are five key questions about the investigation into Walter and the potential ripple effects on the sports and franchises he’s associated with.1. Why is Mark Walter under investigation?Two insurance companies owned by Walter — Delaware Life Insurance Company and Clear Spring Life and Annuity — invested money collected from policyholders by lending it to businesses that then were expected to pay it back with interest.The issue is that some of those loans ultimately financed companies with ties to Walter and were not identified as “affiliated or related-party transactions” as is required. Essentially, investigators are examining whether the transactions amounted to self-dealing.Life insurers typically invest in relatively safe and low-risk assets to provide predictable returns, and insurers are required to report transactions with affiliated businesses so regulators can ensure the terms are fair, conflicts of interests are evaluated and policyholder money is safeguarded.Policyholders depend on there being a backstop so that companies can’t stand on both sides of a deal — as both lender and borrower, said Matthew Pace, a New York sports and entertainment lawyer.Delaware Life and Clear Spring Life received grand jury subpoenas in February as part of an investigation by the U.S. Attorney’s Office for the Southern District of New York. A parallel investigation is underway by the Securities and Exchange Commission. The U.S. Attorney’s Office and SEC declined to comment.Walter has also declined to comment. Both insurance companies said they are “cooperating fully” with the investigations and acknowledged that they incorrectly labeled billions of dollars worth of loans made to companies with ties to Walter.For Delaware Life alone, the company reported at the end of last year that its total portfolio of investments made to companies affiliated with Walter was about 3 percent. After subpoenas and an internal investigation, the company revised that number to 42 percent — or nearly $17 billion.In 2014, Walter’s company, Guggenheim Partners, and three life insurance companies controlled by it were hit with a class-action lawsuit filed by two policyholders who claimed, among other things, that Walter and fellow financier and Dodgers co-owner Todd Boehly used the companies “as a cash machine to buy the most expensive sports franchise in world history, the Dodgers, with over a billion dollars in policyholders’ funds.” The day after the 105-page lawsuit was filed, it was dropped without explanation.The lead attorney who filed the case, Steve Berman, declined to comment when contacted by The Athletic.A separate lawsuit by a policyholder with similar claims was dismissed by a Kansas judge in 2019.2. Why did Walter sell the Los Angeles Lakers?Walter has not spoken publicly about his motivations, but the move comes as he’s facing a liquidity crunch because he needs to reshuffle billions in affiliated investments off of the insurers’ books by the end of the year.News that he would sell the Lakers’ was particularly surprising because Walter spent years trying to break into NBA ownership. He attempted to buy the Clippers in 2014 and then, in 2021, bought a minority stake in the Lakers. Last year, he purchased the team at a then-record $10 billion valuation.Now, he’s found new buyers with familiar names. Former Disney CEO Bob Iger and Thrive Capital founder Joshua Kushner, the younger brother of President Donald Trump’s son-in-law Jared Kushner, agreed to purchase the team for $12.5 billion — $2.5 billion more than when Walter agreed to purchase the team last year.