General Creditors

As of August 20, 2026. No charges have been filed in the federal investigation described here — not against Mark Walter, not against Guggenheim Partners, TWG Global, Delaware Life, Clear Spring Life, Group 1001, the four intermediary companies named below, or the Los Angeles Dodgers. Investigations by prosecutors and regulators can end, and often do end, without charges or enforcement action.

Figures and reporting in this piece are current through August 20, 2026.

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I. The phone on the plane

On September 18, 2025, FBI agents boarded a private plane at Midway International Airport in Chicago and left with a mobile phone and a laptop.

The Bureau's Chicago field office confirmed the search on the record. It was court-authorized, and it was one of several warrants executed that month. The phone belonged to Mark Walter, who runs Guggenheim Partners, co-chairs TWG Global, and has controlled the Los Angeles Dodgers since 2012. Bloomberg reported all of this on July 27, 2026.

Ten months.

In that time the Dodgers won a World Series, spent through a second straight winter, and traded on the most stable ownership reputation in the sport, and nobody in baseball knew that federal agents had taken the owner's phone off an airplane. Field offices do not usually confirm searches on the record, and that one did. Much of the rest — what prosecutors are looking at, which entities, which theory — rests on people who spoke on condition of anonymity, and several of the outlets carrying it note they couldn't independently verify what they were told.

The search happened at a layer of Walter's business that has nothing to do with a ball club. Per Bloomberg's reporting and the regulatory filings that followed it, the federal inquiry concerns an asset-management firm and two life insurance companies. The Los Angeles Dodgers are not alleged to be a party to any of it, and nothing in the reporting reviewed for this piece puts the club inside it.

And in the eleven months between that morning at Midway and this sentence, no charges have been filed against anyone, at any of those layers. TWG Global's position, given on the record to Bloomberg on July 27, is that Walter and the firm have always acted in good faith, that they are cooperating, and that they expect a favorable resolution.

Which leaves the other story. The Dodgers have promised their players more than a billion dollars of deferred salary, running out to 2047, and the shorthand that has attached to it since December 2023 is that Mark Walter owes it — Walter's deferrals, Walter's billion dollars.

The shorthand is wrong.

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II. What the probe is actually about

Start with what the sports desks have been getting wrong. ESPN and theScore have both described the federal investigation as concerning alleged tax fraud. The business reporting describes something else — potential securities and loan fraud, and a failure to disclose related-party transactions. Those are different accusations arising from different conduct under different statutes, and if a reader has only encountered this story through baseball coverage, they have been handed the wrong one.

The inquiry appears to have two origins. Crain's Chicago Business reported on July 27, 2026 that it began with a whistleblower complaint concerning Guggenheim Partners, including representations the firm had made to outside parties about its revenue. Bloomberg, the same day, reported a second early thread: TWG's April 2025 deal with Mubadala Capital, which anchored a $10 billion syndicated investment in TWG, and whether Mubadala was misled about valuations. Bloomberg noted it was unclear whether prosecutors were still pursuing that second line.

From there the focus migrated downstream, to the insurers. Delaware Life and Clear Spring Life are units of Group 1001; as of March the first held roughly $69 billion in assets and the second roughly $16 billion. Both received grand jury subpoenas in February 2026, according to Bloomberg Law and Insurance Business. Neither the subpoenas nor a parallel SEC inquiry became public until regulatory filings disclosed them on June 26, 2026, and those same filings carried the more consequential news: internal reviews had found errors in prior reporting, and investments in affiliated entities were being restated.

The scale of the restatement is where the numbers get slippery, because different outlets have been counting different things. Start with the companies' own figure: their June 2026 filings disclosed more than $20 billion of investments in affiliated entities that had previously been reported as unaffiliated, per the Financial Times. A separate measure, on a different base and a different date — Fitch put related-party lending at 40% of Delaware Life's invested assets at its most recent year-end, the highest share of any North American life insurer the agency reviews. Those two numbers do not reconcile against each other and are not meant to.

A life insurance company isn't really in the business of insurance. It's in the business of holding other people's money for a very long time and investing it well enough to pay claims that come due decades out. The money belongs, in every sense that matters, to policyholders. When that company lends to a business its own owner also controls, the loan may be excellent and the terms may be fair — and a regulator will still want to know about it, because the person deciding to make the loan and the person receiving it answer to the same interests. Disclosure is the entire safeguard. It doesn't prevent the transaction. It puts the transaction where a regulator, a rating agency, and a policyholder can see it.

No regulator has found that the safeguard failed here, and no charges have been filed. What the reporting describes is where prosecutors and the SEC are looking, and one thing the insurers' own reviews turned up. On August 16, 2026, The Wall Street Journal reported that investigators had narrowed their focus to four entities — Miami-based ABS Capital, Amistad Financial, Bradford Allen and Hudson Trading — that it described as intermediaries for loans issued by insurers Walter controls to businesses also connected to him. Forbes, reading the Journal's account, reported the following day that the four are not controlled by Walter. Other outlets covering the same Journal report do not characterize control either way; Reuters' own headline used the word "Walter-linked." None of the four has been accused of wrongdoing, and the reporting placing them in the inquiry rests on people who spoke on condition of anonymity. Miami-based ABS Capital is a different company from the similarly named ABS Capital Partners of Hunt Valley, Maryland, which the reporting does not place in this story at all.

The second question is stranger than the first, and it concerns the insurers rather than the intermediaries. Fitch, whose account reached print through the Los Angeles Times in August, reported that executives at Delaware Life said they had been unaware they were making related-party loans — a statement about a balance sheet that held roughly $69 billion in assets as of March. Neither the executives nor the companies have been accused of wrongdoing, and no charges have been filed.

The response has been public and expensive. On August 18, TWG agreed to buy up to $6.5 billion of affiliated assets from Delaware Life in exchange for unaffiliated ones; Clear Spring cut $90 million more. The insurers have said they expect to report a reduction of up to $8 billion in affiliated assets in their next quarterly update. S&P revised Delaware Life's outlook to negative while affirming its A- rating and noting the remediation plan. Group 1001's on-record position is that it is cooperating and that its financial condition remains strong. Guggenheim's is that auditors issued unqualified opinions on the 2024 and 2025 financials of the subsidiary that owns the private-investments business.

Every entity named so far sits upstream of the ball club. An asset manager. Two life insurers. A holding company. Four intermediaries. The Dodgers appear nowhere in the chain, and the most common error in the coverage of this story has been to collapse all of it into one object called Walter's empire, which is precisely what it is not.

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III. A billion dollars of later

In December 2023, Shohei Ohtani signed a ten-year contract with the Dodgers worth $700 million and agreed to defer $680 million of it.

He gets $2 million a year while he's playing. The rest arrives between 2034 and 2043, across his forties. Asked about the deferral at his introductory press conference in December 2023, speaking through an interpreter, Ohtani said he wanted "a safety net."

What the deferral bought the Dodgers was room under the competitive balance tax. That tax is calculated on a contract's average annual value, and deferred money is discounted to present value for the calculation — at the federal mid-term rate, which for contracts signed that offseason was 4.43%. Ohtani's $70 million a year counts as roughly $46 million against the tax. The club did not receive the $24 million difference. What it received was room beneath a threshold, which converts into a player only if the club is at the threshold and only net of the tax it would otherwise have paid. The Dodgers have been at the threshold every year since.

What it cost him is time and risk, and the Dodgers have never pretended otherwise.

Then the structure went from a contract to a practice. Mookie Betts, Blake Snell, Freddie Freeman, Will Smith, Tommy Edman, Tanner Scott and Teoscar Hernández all carry deferrals. When Edwin Díaz signed in December 2025 — $69 million, $4.5 million deferred annually, the last installment landing in 2047 — the Associated Press, working from contract terms it obtained, put the club's total deferred obligation at $1,064,500,000 across nine players. The peak years in that same December 2025 accounting are 2038 and 2039: $102.3 million owed in each, to men who will mostly have been retired for a decade.

That figure is dated December 15, 2025, and it hasn't been the current one since January.

In January 2026 the Dodgers signed Kyle Tucker to a four-year, $240 million contract that defers $30 million more — $10 million from each of 2027, 2028 and 2029, payable in ten installments every December 1 from 2036 through 2045. No wire service has published a restated total since — so the AP's figure is the last one anybody counted, and it stopped being current about five weeks after it was published.

Add Tucker to the AP's nine and the obligation is $1,094,500,000 across ten players. That sum is arithmetic done here, not a number any outlet has reported.

The obligation is not a sum. It is a rate. It grows most winters, by design, and the counting lags the signing.

The one contract term that comes up whenever this subject does is Ohtani's key-man clause, and it does less than its reputation. It attaches to two people, Walter and president of baseball operations Andrew Friedman. If both leave, Ohtani may opt out. In the middle of August 2026, first The Athletic and then ESPN independently reported that a source with knowledge of his thinking said he would be unlikely to exercise it even if the club were sold, citing the money and the club's reinvestment of what the deferrals freed up.

What it protects Ohtani against is a change in the people. It says nothing about the money. And the deferrals he has already earned survive an opt-out — walking away from the remaining years would not accelerate a dollar of the $680 million or move it anywhere safer. The clause is an exit, not a lien.

Ten men are now owed money in years most of them will not be playing in. Not one of them has a contract with Mark Walter. Every one of those contracts is with the Los Angeles Dodgers.

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IV. Article XVI

The document that governs all of this is not any of the contracts. It is the collective bargaining agreement between Major League Baseball and the players' association, and the relevant part is Article XVI.

It's short, and it is not secret. The reading below follows the analysis published in the American Bar Association's Entertainment & Sports Lawyer in the fall of 2025, which quotes the operative language directly.

There is no cap. Article XVI imposes no limit on the amount of compensation a club may defer, and no limit on the percentage of a contract it may represent. Ohtani's 97% is not an exception granted or a loophole found.

The club must fund it. The money has to be earmarked exclusively for the obligation and held in unencumbered cash, cash equivalents, or registered and unrestricted readily marketable securities. The players' association monitors whether clubs are meeting the requirement.

"Fully fund" does not mean the whole number. The agreement defines the requirement as the present value of the then-outstanding deferred payments, discounted 5% annually, with a two-year grace period. On the ABA's reading, that leaves a club posting roughly 95 cents on the present-value dollar — the discount assuming that the 95, invested prudently, grows at 5% a year to cover the whole obligation by the last payment.

That is a different discount from the one in the previous section. The competitive balance tax uses the federal mid-term rate, which is where Ohtani's 4.43% came from. Article XVI uses a flat 5%. The first decides what a contract costs a club against the tax; the second decides what the club has to have in hand.

And the second one carries an assumption inside it. The funding standard is not "post the money." It is "post an amount that will become the money, if it earns what we assume it earns."

And then the last clause. The funds a club sets aside are, in the agreement's own words, "subject to the claims of the club's general creditors."

So the money is set aside. It is labeled. A club can't spend it on a shortstop.

At least, that is what the agreement requires. Whether the Dodgers have done it — whether the club is current on Article XVI funding for a deferred obligation north of a billion dollars — isn't public, and there's no filing a reader can go and check. The club knows. The players' association monitors compliance and knows. Nobody else can.

Every reassurance here rests on the word funded, and that word is doing work no outsider can audit.

Nothing suggests the club is anything other than fully compliant, and the union would have every incentive to say so if it weren't. The money is set aside exactly as required, then — assumed rather than checked, which is the only form in which an outsider gets it.

What it is not is protected.

It works like an account in the club's name, invested, with the players' names on it. The names say what the money is for. They do not say the account belongs to the players. It is the club's account, and if the club's assets are ever gathered up to pay what the club owes, it is one of the club's assets.

An earmark is an instruction about purpose. It is not a claim of ownership.

Lawyers have a name for arrangements shaped like this. In the executive compensation world they are called rabbi trusts, and their defining feature is exactly the trade in Article XVI: the employee gets protection against the employer changing its mind, and no protection against the employer running out of money. The assets stay on the employer's balance sheet. That's what makes the arrangement work for tax purposes, and it's the price.

What a club's insolvency would mean for that account runs off two documents. One of them is statute and one of them is this essay reasoning past its sources.

The reported one is statute. Federal bankruptcy law grants employees a priority claim for wages and employee benefits ahead of ordinary creditors, but the priority is capped at $17,150 per employee — the figure since April 2025, adjusted every three years — and it reaches only compensation earned in the 180 days before a filing.

The unreported one is what this essay infers from those two documents, and no source cited here makes the inference: that if a club holding earmarked deferred compensation ever reached insolvency, the plain reading of "subject to the claims of the club's general creditors" puts the players in line with the club's other creditors rather than outside the line holding a fund of their own. That reading would leave the overwhelming balance of a deferred obligation in the general unsecured class, with $17,150 per player ahead of the queue.

That is a reading, not a ruling. This essay found no case in which the general-creditor sentence has been argued, and did not search court records to establish that none exists. What can be said is narrower and enough: no club has owed money on this scale and been unable to pay it.

The players' association bargained for a funding mechanism. It's a real one, and it addresses the obvious danger: a club promising money in 2040 and setting nothing aside in 2026. What the players did not get — what nobody appears to have asked for — is bankruptcy-remoteness. Funded and protected are two different words, and the distinction between them has never had to matter.

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V. The chain that would have to break

The case against everything above, at full strength.

The obligation is the club's, not the man's. Ohtani's contract is with the Los Angeles Dodgers. If Mark Walter were charged tomorrow — and as of August 20, 2026 no charges have been filed against him in this matter — his personal legal exposure would not travel to a promise made by a baseball team. Different entity, different balance sheet, different creditors.

A sale transfers the obligation; it does not impair it. Franchises change hands with their contracts attached. A buyer paying for the Dodgers is paying for a roster, a stadium, a television deal, and the deferred compensation that comes with them, and prices accordingly.

The revenue is enormous and contracted. The Dodgers' local television deal, signed in 2013, runs twenty-five years and $8.35 billion, through 2038. That is a scale of guaranteed income no deferred-compensation schedule in the sport comes close to.

Baseball does not remove owners. The commissioner's office has tools and the other owners have a vote, and the history is one of applied pressure rather than formal removal. Owners who've gone have sold, on their own paper, in their own time.

And the precedent is the Dodgers' own. This club has been through Chapter 11. Frank McCourt put it there in June 2011, the team was sold in 2012 for $2.15 billion, and the creditors were paid. Players got their money. The sport's economics covered everything, and the franchise was worth more coming out than going in.

All of that is true, and none of it is a technicality.

The 2011 file carries one detail that cuts the other way, though, and it is the only time Article XVI has ever operated inside a Dodgers insolvency. The Associated Press and ESPN reported at the time that the club owed more than $20 million in deferred compensation, and that more than $18 million was required as a reserve to prefund the following season's player money under the collective bargaining agreement. Those two demands landed in the same week.

So the funding requirement arrived as a bill, at the worst possible moment, alongside the deferred compensation it existed to secure. Everyone was paid in the end and the mechanism worked as designed, on an obligation of roughly $20 million.

The present obligation peaks above $100 million in a single year, twice.

For the federal investigation to reach a dollar of deferred baseball salary, four links would have to give way in order. Charges would have to be filed against Walter personally, and none have been. Those charges would have to create a control-person problem under baseball's ownership rules serious enough that the other owners acted, against the history described above. A sale would have to follow. And then, separately from all of it, the club itself would have to become insolvent.

The first three links do not touch the money. A charged owner does not impair the obligation. A control-person fight does not impair it. A sale, forced or voluntary, does not impair it — a buyer assumes the deferrals, which is why the deferrals reduce the price rather than the payment.

Only the fourth link reaches the account, and nothing in the public record points toward insolvency.

There is a separate question underneath the credit one, and the credit analysis does not reach it.

Two things were reported at the ownership layer this month. Bloomberg reported on August 13 that Walter had pledged his Guggenheim equity as collateral for TWG borrowing at double-digit yields, on a one-year term, with lenders able to seize and sell the stake if the borrowing is not repaid. Pledging equity for financing is ordinary; the yield and the term are the parts a lender sets, and neither is an allegation about anyone. John Ourand reported in Puck on August 18 that Walter had approached Charter about exiting the Lakers' and Dodgers' local television deals early, in exchange for a lump sum, and that the talks went nowhere.

The second points at the club without touching the investigation. That television deal is the same contracted twenty-five-year revenue that makes every deferred dollar look comfortably covered — the most dependable money in the story, and the money the owner asked about taking early. Wanting to convert a long receivable to present value is ordinary, and exploring it is not a distress sale.

Buying and selling assets at these valuations is what a managed portfolio looks like — not evidence of wrongdoing, and not evidence of distress. Walter agreed in June 2025 to buy the Lakers from the Buss family at a valuation around $10 billion, and the NBA's Board of Governors approved that unanimously in October. On August 12, 2026, a sale of the Lakers to Josh Kushner and Bob Iger at $12.5 billion was announced. It is not yet done — the Board of Governors has to approve it, and its next meeting is September 15 and 16, 2026.

None of which is evidence of anything. The question underneath it was never whether the deferrals get paid in 2038. It is what happens to the largest payroll in baseball if the owner funding it ever wants his capital back.

That is a competitive question rather than a credit one. It needs no bankruptcy, no charges and no insolvency. It needs only an owner who decides, in some particular winter, to spend less — and nothing in the reporting says that has happened, or that it will. It would show up not in a filing but in a free agent the Dodgers do not sign, in an extension they do not offer.

Article XVI is not a permanent feature of the landscape. It is a clause in an agreement that expires at 11:59 p.m. Eastern on December 1, 2026. That date was set in 2022 and has nothing to do with anything above it: the funding rule was always going to come up for renegotiation this winter. Bruce Meyer, the players' association's interim executive director, has told players to expect a lockout when the agreement expires. The owners have proposed a salary cap for the first time since 1994.

And deferrals are inside that fight, not outside it. Writing in February 2026, ESPN's Jeff Passan argued that Tucker's contract "might have been the final blow for labor peace," and named the mechanism in the terms the owners use: the Dodgers and Mets, he wrote, "are content funding the deferred money... because it lowers the salary used to calculate their luxury tax bills."

Tax room is not cash, and the advantage is worth less than the owners' version of it. But the owners are not arguing about its size. They are arguing that it exists, and that argument is now inside the same negotiation as Article XVI.

Which puts the players in a position nobody designed. The rule that requires their deferred money to be funded lives in the same document as the practice that thirty owners are about to argue is breaking the sport. Whatever the funding regime looks like in 2027, it will have been written by people whose principal argument about deferrals is that there should be fewer of them.

What that means for money already earned is the question this essay cannot answer. Deferred compensation already earned sits in individual player contracts, and those contracts survive the agreement that governed their signing. The machinery that funds the money sits in Article XVI, and Article XVI expires with the agreement. Whether that machinery carries forward, gets renegotiated, or lapses into whatever the next agreement builds is a question nobody has bargained yet.

Nobody has said it's at risk. Nobody has said it isn't.

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VI. Nobody asked which entity

Go back past all of that, to the transaction that made Walter a baseball owner. Contemporaneous coverage of the 2012 purchase — Bloomberg's profile of him that May, and reporting since — records that part of the money came from insurance companies Guggenheim owned, and that the financing drew questions inside the sport at the time. A specific dollar figure has been reported since. This piece couldn't confirm it to the original source and doesn't print it.

Policyholder money and a franchise purchase ran through the same set of businesses in 2012, and people in the sport asked about it at the time. That much is on the record. Whether anything was undisclosed — which is the whole of what prosecutors are examining now, fourteen years later and at a different layer — nobody alleged then, and nobody has alleged it since. Nothing in the reporting places that transaction inside the present federal inquiry, and no charges have been filed in connection with it.

And there is one document, eleven years old.

On August 10, 2015, the Securities and Exchange Commission announced that Guggenheim Partners Investment Management had agreed to pay $20 million to settle charges that it failed to disclose a conflict of interest to its clients. According to the Commission's announcement, a senior executive at the firm took a $50 million loan from an advisory client in July 2010, to fund a personal investment in a corporate acquisition led by Guggenheim's parent company. The following month, the firm placed certain of its advisory clients into two transactions in which the lending client had also invested, on different terms. The clients were not told about the loan, and senior officials at the firm and its parent who knew of it did not inform compliance. The same settlement covered a separate finding: that the firm had inadvertently misclassified certain of an institutional client's investments as assets it managed, and charged that client roughly $6.5 million in fees the firm had not earned.

An undisclosed loan between related parties, and nobody told the people whose money was on the other side of it.

The settlement resolved without any admission of wrongdoing, and it is evidence about 2010, not about 2026. Forbes has reported that a separate SEC inquiry into Guggenheim, concerning real estate deals linked to Walter, ended in 2019 without a penalty. The record holds both.

The 2015 matter is not proof of anything now. What recurs is not a magnitude. It is a question, asked twice about the same firm eleven years apart: who was on the other side of the loan, and was anyone told.

Back, then, to December 2023, and a press conference in Los Angeles.

In and around that room: a player with one of the industry's major agencies behind him. A club run by a front office the sport copies. A union with a compliance apparatus purpose-built for exactly this clause. Lawyers on every side of the table. A commissioner's office that reviews and approves the contract. A press corps that covered the deferral structure for weeks, in detail, and got the mechanics right.

Between them they read Article XVI, understood that the money would be funded, and never arrived at the question of which balance sheet the promise was actually a claim against — a baseball team with its own creditors, or a holding company, or a man. Nobody hid it. The only time a Dodgers ownership ever ran out of money, the players were paid, and that is a reasonable basis for confidence. It is a poor basis for a twenty-four-year promise.

And the man at the microphone that afternoon, speaking through an interpreter, said what he wanted was a safety net. He was deferring $680 million so the Dodgers could build a team around him — an act of some generosity, whatever the tax treatment was worth. Nobody at that press conference, including him, appears to have asked the other question a net raises, which is what holds it up.

We didn't ask either. Those of us who saw the two headlines side by side this summer — owner under federal investigation, and a billion dollars owed through 2047 — and felt something cold, felt it because we had assumed the second was secured by the name in the first. That assumption is the error. It was always the club. It was in the contract, in the agreement, in the coverage, in plain sight, and it went unexamined for two years and eight months because nothing had ever made examining it worth the trouble.

Something did, on a plane at Midway, in September of 2025, and it may come to nothing at all. Investigations close. No charges have been filed. There is a version of this where the deferrals are paid on schedule, in full, by a club that has never missed, and asking which balance sheet was on the hook turns out to have been a matter of hygiene rather than money. There is a version where the question the probe raised, at one layer of a man's business, is the question the sport should have been asking all along about a different one.

The players are owed money by the Los Angeles Dodgers, a corporate entity with revenues, obligations, an owner, and — in the agreement's own language, sitting there since long before any of this — general creditors.

Everyone knew that. Nobody had thought about it.

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Reporting on the federal investigation described here is drawn from Bloomberg and Bloomberg Law, Crain's Chicago Business, the Financial Times, Reuters, the Los Angeles Times, Puck, The Athletic and The Wall Street Journal, on the dates given in the text. Ratings and credit assessments are Fitch's and S&P's; the mischaracterization of the inquiry as a tax matter appeared in ESPN and theScore. The Journal's August 16 report was not read in the original; its contents here are as described by Fortune, Forbes and Bisnow. Much of this reporting rests on people who spoke on condition of anonymity, and several outlets note they could not independently verify what they were told. Contract terms for the deferrals through Edwin Díaz are from the Associated Press and ESPN; Kyle Tucker's are from MLB.com and subsequent beat reporting. Article XVI analysis is from the American Bar Association's Entertainment & Sports Lawyer (Fall 2025). The 2015 SEC settlement is described from the Commission's August 10, 2015 announcement as reported by Pensions & Investments, Fox Business and Lexology; the order itself was not read.

No charges have been filed against any party named in this piece. Mark Walter and TWG Global have said, on the record, that they have always acted in good faith. Group 1001 has said it is cooperating and that its financial condition remains strong. Guggenheim has said its subsidiary's 2024 and 2025 financials drew unqualified opinions from auditors. Delaware Life and Clear Spring Life are units of Group 1001. Miami-based ABS Capital, Amistad Financial, Bradford Allen and Hudson Trading have not been accused of wrongdoing and have not, so far as this piece is aware, been asked to comment. The Los Angeles Dodgers are not alleged to be a party to the investigation; the club's president, Stan Kasten, has said of the matter that it has nothing to do with the Dodgers. ABS Capital Partners of Hunt Valley, Maryland is a different firm and is not connected to any of this.