Federal investigators are examining about $20 billion in insurance investments at Mark Walter's companies over affiliated lending practices. Almost all of the $5.2 billion in short-term loans made last year went to affiliates, with most due to mature by the end of August. TWG Global denies fraud and has agreed to a $6.5 billion asset swap with Delaware Life.
A federal probe is examining $20 billion in investments at Mark Walter's insurers, where $5.2 billion in short-term loans went to affiliates.
"It's very unusual," said Alton Cogert of Strategic Asset Alliance in Washington state, who advises insurers on their investment mix. The industry as a whole held 0.6% of assets in short-term investments in 2024, according to an American Council of Life Insurers factbook.
Delaware Life had 8.6% of its overall investments in short-term loans at the end of 2025, while Clear Spring held almost 14%, according to an analysis of their filings. Almost all of the $5.2 billion in short-term loans the insurers made last year went to affiliated businesses. Most were due to mature by the end of August.
The maturity timing could ratchet a funding squeeze on Walter and TWG Global, his conglomerate that recently sold a controlling stake in the Los Angeles Lakers a year after buying it. TWG agreed to buy up to $6.5 billion of Delaware Life's affiliated investments in exchange for unaffiliated assets, a deal that still requires approval from Delaware's insurance commissioner.
The federal probe, run by the U.S. Attorney's Office for the Southern District of New York alongside the SEC, is studying how Walter-controlled insurers helped fund his other businesses and whether fraud occurred. The investigation prompted the insurers to reclassify more than a third of their assets as connected to their owner. Delaware Life originally reported about 3% of its portfolio was tied to Walter-affiliated businesses; by its own restated figure, that number came in at 42% of invested assets, more than $16 billion. Fitch Ratings has called that the highest concentration of affiliated investments of any North American life insurer it reviews.
Most of the short-term loans went to limited-liability companies with little public footprint. Annual interest rates ranged from 6% to 12%. The largest loan listed at the end of 2025 at Delaware Life was $140 million, due in May, to Cypress Park Financial MP, registered in Delaware by a senior managing director at TWG.
Investigators have focused on four businesses that may have served as intermediaries: ABS Capital, Amistad Financial, Bradford Allen, and Hudson Trading. Money from a Delaware Life or Clear Spring loan would go to one of these firms first, which then directed it onward to a Walter-linked business. On paper, the insurer made a loan to an independent company.
TWG Global said it "stands firmly behind the integrity of its business" and that its insurance companies invested in "real assets that are performing well." The company said "there has been no fraud."
The concentration of short-term investments is unusual for life insurers, which typically hold longer-dated bonds and mortgages to match liabilities stretching decades. Short-term investments that aren't cash require insurers to hold more capital as a buffer, said Erik Miller, senior director at AM Best. State insurance regulators tightened rules around the category in recent years after finding that some unnamed insurers rolled over loans to conceal longer-term assets.
The funding pressure comes as Walter faces broader scrutiny. The FBI executed a search warrant aboard a private plane at Chicago's Midway Airport in September 2025, seizing a phone and laptop belonging to Walter. No charges have been filed against Walter or his companies. TWG said the Dodgers "are not being sold and no sale process has been initiated."
The maturity of these loans tests whether TWG can refinance or replace the capital without disrupting its insurance operations. Investors will watch for Delaware's insurance commissioner to rule on the $6.5 billion asset swap, which would remove the affiliated exposure from Delaware Life's books.
This article is for informational purposes only and does not constitute investment advice.
