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SEC Probes Guggenheim's Investment Management Unit

The securities regulator is reportedly examining real estate transactions involving Guggenheim and ABS Capital.

The Securities and Exchange Commission is investigating the asset management business of Guggenheim Partners, probing real estate transactions that include a California home partly owned by the firm's chief executive officer, according to the Wall Street Journal.

An $85 million Malibu home in which Guggenheim CEO Mark Walter and ABS Capital Co. co-invested is among the deals being examined by the SEC, the newspaper reported April 15, citing people familiar with the matter. Miami-based ABS Capital is owned by two former Guggenheim managers, according to the report.

"We are cooperating fully with the SEC's investigation of our subsidiary, Guggenheim Partners Investment Management (GPIM), and we cannot comment further," a spokesman for Guggenheim said in an emailed statement Monday. An SEC spokeswoman declined to comment.

According to the Wall Street Journal, the SEC's enforcement staff has asked Guggenheim to keep documents linked to transactions with ABS Capital, and that they have subpoenaed ABS Capital for information. The Miami firm is controlled by former Guggenheim managers Pablo Stalman and Juan Ball, the newspaper said.

Guggenheim is an investment and advisory firm with more than $305 billion of assets under management, according to its website. ABS Capital is not a client of Guggenheim Partners Investment Management, a spokesman for ABS said in an email.

The Wall Street Journal reported last year that Guggenheim's global head of institutional distribution, Alexandra Court, was negotiating a possible departure amid internal unrest and regulatory scrutiny. Court moved into one of two Pacific Palisades properties purchased by ABS Capital, according to the Journal.

ABS Capital owns the two Palisades homes and the home in Malibu, the spokesman confirmed. "ABS did not borrow any money from GPIM or GPIM-managed assets in connection with the financing of those homes, or for any other purpose," he said. 

Guggenheim has three primary businesses, including investments, investment banking and insurance services, according to its website. The investment business focuses on the needs of investors such as insurance companies, public pension funds, sovereign wealth funds, endowments, and foundations.


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