Dodgers owner Mark Walters being investigated

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The federal law enforcement probe into the financial affairs of the Dodgers' controlling owner, Mark Walter, seems to focus on what looks like an obscure financial maneuver: related-party transactions.

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Walter tapped insurers he controlled to provide most of the financing for the $2.15-billion acquisition of the Dodgers in 2012, The Times has reported — a deal later vetted by state insurance regulators.

Now, regulators reportedly are investigating whether billions of dollars' worth of similar loans made by Walter's companies were properly disclosed.

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There are examples in which related-party transactions led to trouble, including the 2001 bankruptcy of Enron Corp., the largest at the time in Wall Street history. Bernie Madoff profited from his Ponzi scheme through related-party loans.

At issue with Walter is $21 billion in loans not disclosed to state insurance regulators that were made by two Delaware insurers he owns, according to ratings agency Fitch. The loans reportedly were made to companies with ties to Walter or his TWG Global holdings company.

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The seriousness of the investigation has been highlighted by subpoenas served on the insurers and the reported seizure of Walter's cellphone and laptop by federal authorities.

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Tl;dr version: Basically it appears like there were potentially some financial shenanigans involving intra-group loans and how those were reported on insurance companies in his group so it seems like the Dodgers deferred deals (and maybe Chelsea too?) were a part of some financial fraud.

I.E. He may have Madoff’d his way to a Dodgers dynasty.



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