Academy Group will be funded by an entity being examined as part of the probe into Walter's insurance lending; charity says the switch was always the plan
By Shane Shifflett and Margot Patrick
A charity that Los Angeles Dodgers owner and billionaire Mark Walter launched to put urban kids on a path to college and high-paying jobs is now being primarily funded by a little-known Chicago financial firm that has also been linked to the federal probe into Walter's insurance empire.
Academy Group, started in 2017 by Walter and associates including Earvin "Magic" Johnson and Don Thompson, told staff at the end of July that Amistad Financial would now be its primary source of funds. Amistad is a financial holding company that had recently acquired an insurance company Johnson and Walter owned.
Amistad is also one of four entities that are being examined as part of a probe into how Walter's insurance companies failed to report that $20 billion in loans were tied to Walter, The Wall Street Journal has reported.
Proceeds from the loans made by Walter's insurers passed through entities purportedly controlled by Amistad, and the other firms, before being used to fund other Walter-linked businesses, the Journal reported.
In the wake of the funding change, staff at Academy Group have been left wondering about its budget for months, according to people familiar with the matter. The charity cut some temporary staff, reduced some programs and Chief Executive Greg Jones resigned rather than implement further budget cuts, according to a recording of a call he held with staff that was reviewed by the Journal.
Walter and his businesses haven't been accused of any crimes in the probe and have denied any allegations of fraud.
His lawyer said the funding changes at Academy Group had been the plan for the charity since it launched. He denied that Walter was changing his own commitments or pulling back from Academy Group or any other charity.
The Walter family issued a press release that said it was upholding its philanthropic commitments and highlighted its funding to Academy Group.
"For more than two decades, Mark and Kimbra Walter have committed hundreds of millions of dollars to organizations and initiatives focused on serving under-resourced communities, expanding educational opportunity, and protecting wildlife and the ecosystems that sustain them," the release said. "That commitment is not slowing down."
A 'womb-to-tomb employment opportunity'
Walter has said he and Johnson came up with the idea for Academy Group as a "womb-to-tomb employment opportunity," after talking about how to turn gang members into CEOs. They brought in Thompson, a former McDonald's CEO who co-founded and runs consumer-brands investment firm Cleveland Avenue with his wife.
Academy Group's mission is to get thousands of children into college and well-paid jobs with tutoring vouchers, academic stipends and sponsored internships, and it so far has a 90% college graduation rate.
Its programs involve years of investment in a child to get them into college with tutoring, campus tours and summer programs.
It has said its programs are aimed at helping participants build general wealth and cited research that Black and Latino families only hold 2% of the wealth being passed on by baby boomers.
From the start, the funding set up was unusual and another sign of Walter's propensity to use his empire: Walter planned for the charity to use investments in businesses to generate returns that would fully fund the operations.
To seed the effort, Walter invested and then moved stakes and returns into Academy Group. The original stakes Academy Group held were in Thompson's Cleveland Avenue and CFI Partners, another investment firm with ties to the circle.
But Walter's family has been the main source of funding for years, according to people familiar with the matter, internal documents reviewed by the Journal and an Academy Group impact report.
In Academy Group's last fiscal-year report, for 2025, the Walters were named as the leading source of support.
The funding propelled Academy Group to grow into multiple cities.
A 'systems transition'
In late July, around the same time the Walter probe became public, Academy Group told staff the funding was changing, saying it had always been the plan.
Founder Shayne Evans gathered staff for a presentation that announced Amistad Financial would become the primary source of funding for the organization, the people said. Staff were told there would be changes to funding for the fiscal year that had just started and the programs it ran, they said.
Slides reviewed by the Journal put the Walter family's funding under the heading "Yesterday," while Amistad's was the source for "Today" and "Tomorrow." The slides said the plan was always for Amistad to take over the funding from the Walters.
"This is a systems transition -- not a funding problem," the presentation said.
The funding system isn't fully operational yet, according to people familiar with the charity.
Budgeting for the fiscal year starting in July would be closer to $10 million than the nearly $19 million they had in the prior year, staff were told.
Academy Group has told families recently that support they thought their children would get is being withdrawn or cut back. Charity leaders have said the changes were to reach more students, not to cut funding.
In the call with staff where he announced his resignation as CEO, Jones told them he hadn't received information he needed to plan the budget. He said his own salary was equal to about four staff salaries, leading him to decide he should leave.
"This path forward is not something that I'm aligned with," Jones said. "So, I'm doing the company a double disservice by incurring a cost for something I don't believe in."