Add The California Post on Google An employee who raised red flags over suspicious revenue booking is behind what sparked a massive federal investigation into billionaire sports mogul Mark Walter.
US prosecutors are probing the owner of the Los Angeles Lakers and Dodgers, after receiving information billions of dollars in profits had allegedly ended up in his insurance companies’ accounts.
It’s since been revealed the informant who tipped authorities off about the matter was reportedly one of Walter’s own employees, acting as a whistleblower.
The US Attorney’s Office in Manhattan, alongside the Securities and Exchange Commission, are investigating how about $16 billion in loans for Walter’s conglomerate TWG Global were channeled through a third party before dropping onto his insurance companies’ balance sheets, according to the Wall Street Journal.
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Investigators are working to determine whether Walter or his company has committed any fraud.
But TWG Global denies any wrongdoing, with a spokesperson saying Walter and the company have “always acted in good faith”.
“Those who have done business with Mark know him as honest and straightforward. Nothing about these transactions was any different,” the spokesperson said.
“We are confident these matters will be resolved favorably.”
TWG Global is cooperating with authorities on the investigation, which was disclosed by Walter’s insurers in June regulatory filings.
The investigation comes amid a regulator crackdown on private lenders granting loans to businesses, which has become a massive pain point for banks.
Life insurance companies, such as the ones Walter runs, are bankrolling the private credit industry.
Walter, who has an estimated net-worth of $7.3 billion according to Forbes, has become a prominent figure in the sports world following his success on Wall Street.
After co-founding global investment and advisory firm Guggenheim Partners, Walter played a core role in purchasing several insurance companies before later establishing TWG Global which has stakes in sports teams and other financial groups.
Walter is known for his affiliations with the Dodgers, the Lakers and Chelsea. He also owns the WNBA’s LA Sparks, and invests in both the Billie Jean King Cup and the Cadillac Formula 1 team.
TWG Global promotes itself as “a unique holding company”, which strategically invests in and operates businesses across investment management, securities, AI and technology, finance and Corporate lending, merchant banking and private investments, and sports, media and entertainment.
The California Post has contacted TWG Group for comment.
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