Mark Walter sold the Los Angeles Lakers to Bob Iger and Josh Kushner this Wednesday, less than ten full months after he officially acquired the franchise. Talk about a bombshell move! This sale, though, drops right as Walter is under federal investigation by the FBI for loan fraud.
The Feds Are Looking At Walter’s Wallet
The FBI investigation started last year and it’s been digging into Walter’s finances, how his investment group was valued, and whether loans he took out were properly disclosed. This isn’t just some minor audit, either. The government is reportedly investigating if Mubadala Capital, an Abu Dhabi sovereign wealth fund, got duped about the valuations of Walter’s companies. We’re talking about a massive $10 billion investment by Mubadala Capital into Walter’s firm, which then purchased the Lakers a few months later. That’s a huge sum, and if there was any deception there, it’s a monumental problem.
Bruce Dubinsky, a forensic accountant who worked on huge cases like Enron and Madoff, broke down the issue with a simple analogy. He said selling something to a stranger involves research and agreeing on “fair market value.” But if you sell to your brother, you might cut the price or even forgive payments. Dubinsky warns that “from an audit standpoint, there should be more scrutiny if you’re doing business with the left hand and the right hand, because it’s easier to manipulate things.” He added that “Repayments can be delayed indefinitely. They are always more suspect to fraud.” Basically, Walter might have fudged the numbers on his company’s value to get more investors to open their wallets.
Why The Sudden Lakers Sale?
It’s definitely not a good look that the owner of a team like the Lakers has been under federal investigation for pretty much the entire time he’s owned the team. If things aren’t looking great for him, then selling off the Lakers and using that cash to sort out some of these major problems could be a way out. And according to Bloomberg, that’s exactly what might be happening: Walter selling the Lakers could be his strategy to fix some of the issues tied to this federal probe.
The sale of a franchise this big, especially so quickly, always raises eyebrows. But with the FBI sniffing around for loan fraud and accusations of deceiving investors, this Lakers transaction looks like it might be way more than just a business deal. What happens next for Walter and this investigation is the real story to watch.
This article was created with AI assistance and published under Seattle On Tap’s editorial standards. See our Editorial Policy.
Originally reported by Silver Screen and Roll.
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