The NBA's giant whiff on Mark Walter
Abundant warning signs
Last fall, the NBA loved Mark Walter.
As Mark assumes his role as majority owner of the Lakers, I have no doubt that he will be a committed steward of the team and a great addition to our league given his many successful ventures in business and sports.
–NBA commissioner Adam Silver, October 30, 2025
Mark and his oft-partner Todd Boehly—the guys from Guggenheim—have day jobs but, over the last decade or so, have seemed to be on a 24/7 mission to drive sports valuations to the moon. They seemingly bid on everything.
Here’s a short list of sports things they have thrown money at: the Cadillac Formula One team, Chelsea Football Club, the Dodgers, the Lakers, the Sparks, the Indianapolis 500, the stadium where the Pacers play, Caitlin Clark (who is a brand ambassador or something), and the Women’s Professional Hockey League. They paid Shohei Ohtani $700 million.
They do this despite being, it appears from news accounts, not all that rich. Boehly and Walter tend to do this in consortiums with big names like Stan Kasten, Peter Guber, Magic Johnson, and Billie Jean King. When they bid unsuccessfully on the Clippers, it was in partnership with David Geffen, Larry Ellison, and Oprah Winfrey.
Silver employs hundreds of lawyers to vet these deals, and spends vast sums on outside firms as we have seen in the case of Wachtell Lipton researching Steve Ballmer, the other Los Angeles NBA owner, for other kinds of alleged malfeasance.
In the case of Mark Walter, and his reputation in 2025, however, Silver would not have needed anything but a newspaper subscription to sniff potential trouble. As the Ringer’s Katie Baker points out, Andrew Ross Sorkin wrote the following in the The New York Times when Walter bought the Dodgers in 2012.
When the numbers don’t seem to add up, it’s worth asking some questions,” Sorkin warned about the delta between Walter’s actual liquid assets and the purchase price. “Using insurance money—which is typically supposed to be invested in simple, safe assets—to buy a baseball team, the ultimate toy for the ultrarich, seems like a lawsuit waiting to happen.” A chunk of the money used to buy the Dodgers, he explained, was being sourced from a handful of insurance companies controlled by Walter. “Mr. Walter, along with his colleague Todd Boehly,” Sorkin wrote, “appear to be living out a childhood fantasy using other people’s money, some of whom may not even realize it.”
Note: 2012!
In 2014 there was a legal complaint. Nick Nemeth is a brilliant man who is laser focused on … this hot mess in the insurance industry that we’ll get to in a second. On Nemeth’s Substack Mispriced Assets last month he discussed something that surely matters.
In February 2014, two annuity holders sued Guggenheim Partners, Security Benefit, Guggenheim Life and Annuity and EquiTrust in federal court in Chicago. The complaint, a copy of which was reviewed by Mispriced Assets, said that Walter, Boehly and a business associate named Bobby Patton “used the Guggenheim Insurers as a cash machine to buy the most expensive sports franchise in world history, the Los Angeles Dodgers, with over a billion dollars in policyholders’ funds.” It said the affiliated paper had been hidden in the schedules “where the affiliated nature of the investment is not readily ascertained.” And it named the shell companies used to move the money: newly formed Delaware entities, labeled unaffiliated, with invented names. Eikenberry. Elmdale. Burnaby.
The forensic accountant who built that case, Tom Gober, says the case settled favorably.
When Silver discussed Mark Walter’s track record in business and sports, this is that track record. Surely Silver has read Andrew Ross Sorkin’s column, and seen a record of that lawsuit.
Often the slowest milieu to catch up to new trends is academic literature. Nemeth points out: even they are alarmed about undue risk in the pools of capital held by insurance companies like Walter’s. Nemeth writes:
In a paper posted in July, two law professors, Andrew Granato of the University of Texas and Pranjal Drall of Yale, laid out the machinery in general terms: opacity in private credit lets an insurer “appear better capitalized than their true risk exposure warrants,” and when an affiliated fund needs to move an underperforming loan, “the insurer can become the convenient buyer.” The part few people know, they wrote, is where the losses land. When a life insurer fails, other insurers are assessed to make its annuity holders whole, and in thirty-four states those assessments are creditable, dollar for dollar, against the assessed companies’ state premium taxes. Follow that to the end, and the guarantee behind a failed carrier’s promises is not the industry. It is the state’s tax base. It is the customer, twice.
Group 1001 has said its financial condition remains strong. TWG Global, Walter’s holding company, said it is aware of and cooperating with the investigation.
Walter was approved by the NBA’s board of governors on October 30, 2025. Silver called Walter a “committed steward” of the Lakers franchise, which is hilarious in hindsight, for a guy who only needed nine months to hot-potato the Lakers to the next set of deep pockets.
Does Mark Walter grasp the concepts of commitment or stewardship? Or is he ushering our economy into its next great crisis? While I worked out yesterday, instead of listening to music, I listened to all of this podcast about how private credit and insurance companies are creating something like the 2008 financial crisis, but at a far grander scale.
Nemeth said all that before the news that Walter was selling the Lakers.
I’m going to guess that you won’t watch the whole thing, so let me tell you a key part: Nemeth’s math shows that these insurance companies are outlandishly leveraged. Through various sneaky mechanisms they have in some cases, Nemeth says, borrowed 60x or even more insane multiples of the money they have on hand. They have scant “tier one” assets, and a lot of what’s left after that is rated by a ratings agency of the insurance company’s choosing. The most common outcome is that the assets are rated good enough to borrow against, and so they borrow, put the money in hard-to-track accounts, and then end up owning lavishly priced sports teams.
There are so many ways this could go awry. Nemeth sees the most immediate as: people with many whole life insurance policies can cash out. It’s called a surrender. You give up the policy, maybe pay a little penalty, and walk away with your money. Historically, not many do that. But historically, life insurance companies invested very conservatively, and didn’t make headlines for selling the Lakers or inspiring multiple concurrent investigations. Life insurance companies, historically, have tried to appear boring and unlikely to go out of business.
Nemeth meticulously explains that many insurance companies don’t have enough cash or cash-like investments on hand to handle even a mild uptick in surrender requests. These private equity-backed insurance companies then tend to rely mightily on private credit, which has been on the brink of crisis for the last year or so. Two days ago, the Financial Times reported that Walter’s whoopsie had indeed caused a market shift. On X, Nemeth responded with a spark emoji.
The NBA is an association of billionaires, almost all of whom made their money in hard-to-understand ways. It’s a league of spending funny money, earned in funny ways.
And nowadays it is especially wrapped up in this little nest of private equity, private credit, and insurance. As Nemeth narrates this risk, he talks often about Athene. Athene is a creation of Apollo Global, which here at TrueHoop we have long referred to as the NBA’s most important source of cash. That’s the current or former home of Leon Black, Marc Rowan, Josh Harris—all of whom have had a hell of a time beating back allegations they were tied to Jeffrey Epstein. Adam Silver’s college roommate Jim Zelter is the president of Apollo.
Nemeth also talks about Ares Capital, which was founded by Tony Ressler who is the lead investor in the Atlanta Hawks. “Ares has the biggest gap of brand name … to reality,” says Nemeth. “Their business is having a brand and having professionals believe you’re god’s gift to earth, but that is the one that I would knock down the most in terms of reality.”
The thing that Leon Black, Marc Rowan, Josh Harris, Tony Ressler, Mark Walter, and Todd Boehly all have in common is that they have invested heavily in insurance, backed by private credit. They are driving whatever it is that is upsetting Nick Nemeth and the markets.
And … they were all mentored by disgraced financier Michael Milken.
Black, Rowan, Harris, and Ressler worked with Milken at Drexel Burnham Lambert.
Walter and Boehly both have extensive Milken ties; their Guggenheim Partners paid a fine after an SEC investigation found they were working a little too closely with Milken. Boehly is Milken’s business partner.
And, interestingly, they tend to invest alongside Magic Johnson, who also loves Michael Milken. Magic is part of Walter’s Dodgers’ investment, Harris’s Commanders team, and has done deals with CalPERS which is one of the biggest outside investors in Apollo Global.
A common social media response to this story has been the joke, or suggestion, that Walter will donate to … some Trump-affiliated entity … and his legal troubles will melt away. I’ve heard the word “pardon.” Indeed, Walter was just at the White House on July 23 with the title-winning Dodgers and, outlandishly, gifted the President a Dodgers championship ring.
At that event, Trump called Walter a friend. Part of me has been thinking: The FBI, the SEC, and the Southern District … still go after the president’s billionaire friends?
Nemeth points out that many in the industry have the idea that “one of us will go down, and then everyone else will be declared systemically important … and then the Fed will come and back stop it.” Speculation: perhaps people more powerful than Walter are excited to see Walter be the one of us to go down first.
Another thing that caught my eye. Zachary R. Mider, Ava Benny-Morrison, and Myles Miller report for Bloomberg that when this investigation into Mark Walter began, the aggrieved party was Mubadala Capital.
An early focus of the inquiry was a deal TWG struck last year with Mubadala Capital, an arm of an Abu Dhabi sovereign wealth fund, according to people familiar with the matter. In April 2025 the companies announced Mubadala Capital would anchor a $10 billion syndicated investment in TWG.
Prosecutors were looking into whether Mubadala Capital had been misled about valuations, said the people, who asked not to be identified discussing confidential matters. It’s unclear whether prosecutors are still pursuing that line of inquiry.
Mubadala Capital might be the best-connected investment firm in the world. As we’ve written about in the past, this goes crazy deep.
Mubadala has a multi-billion dollar partnership with Apollo Global, a joint venture with Ares. They have a deal with Michael Milken.
The CEO of Mubadala is Khaldoon Al Mubarak, an Emirati official who has a story of growing up wearing a Lakers jersey to a Celtics game and getting flipped off by an older couple.
Mubadala also has a deal with Jared Kushner, whose brother is buying the Lakers from Mark Walters.
Like Adam Silver, Magic Johnson cheerleads this crew’s every move, whether the evidence justifies it or not.
How did the NBA miss every Mark Walter warning sign?
In an economy where there’s massive money to be made by bending the rules, you can also do OK by turning a blind eye.
There’s a Nick Nemeth quote from the YouTube above. I’m taking it out of context, he’s not talking about the NBA. But I think you’ll see why it’s on my mind: “They’re not dumb. They’re paid to be dumb.”
All that matters now: will they be smart if there are warning signs about Bob Iger and Josh Kushner?
COMING NEXT: What we know about Iger and Kushner.
Wow! What a fantastic piece. Laker fans are not responding well to the new ownership but clearly the Walter regime was going to end badly. As a fan that sucks, but what's coming next for the market looks far, far worse.