Key facts
- TWG Global is working with U.S. regulators to address concerns over related-party investments in its insurance companies.
- The firm has submitted a plan to the Delaware Department of Insurance to eliminate all affiliated exposure at its insurance companies.
- U.S. prosecutors and the SEC are investigating whether certain private credit investments were wrongly categorized.
- Delaware Life restated its financial statements, reclassifying significant private credit investments as related-party assets.
- TWG previously agreed to swap up to $6.5 billion of related-party investments for equivalent independent assets, pending regulatory approval.
Billionaire Mark Walter's holding company, TWG Global, is actively engaging with U.S. regulators to address concerns surrounding related-party investments on the books of his insurance companies. In a statement, TWG asserted that no fraud had occurred and that it is working collaboratively with the Department of Justice and the SEC to resolve inquiries.
TWG's entity, Group 1001, which owns Delaware Life Insurance Company and Clear Spring Life and Annuity Company, has submitted a plan to the Delaware Department of Insurance aimed at systematically eliminating all affiliated exposure within these insurance entities. This move follows regulatory filings indicating that U.S. prosecutors were investigating whether certain private credit investments were improperly classified as unaffiliated.
Earlier this year, Delaware Life and Clear Spring received subpoenas from the U.S. Attorney's Office for the Southern District of New York, with the SEC conducting a parallel investigation. In June, Delaware Life restated its annual financial statements, reclassifying substantial portions of its private credit investments, which increased its affiliated investments to 42% of its total invested assets from less than 5%.
Insurers are permitted to hold affiliated investments, but these are subject to strict regulatory oversight due to potential risks and conflicts of interest. TWG had previously agreed to a transaction, pending regulatory approval, to swap up to $6.5 billion of Delaware Life's related-party investments for an equivalent amount of independent assets. This proposed transaction could reduce Delaware Life's total affiliated assets to approximately 26% from 39%.
Regarding its sports assets, TWG stated that while there is continued interest from potential buyers and co-investors, the firm is not seeking to sell them at distressed prices to raise capital for its insurance operations. TWG confirmed that the Los Angeles Dodgers are not for sale, nor is its stake in the Cadillac Formula 1 team.