Minerd’s relationship with Diamond dates back to the early 1990s when he worked for the prominent banker at Morgan Stanley in London. Minerd later returned to the U.S. and followed Diamond to Credit Suisse First Boston. 

While Guggenheim initially invested in Atlas Mara, regulatory filings show the connections increased four months later when insurers owned by Guggenheim’s largest shareholder, Sammons Enterprises, paid more than $5 million for stakes in Atlas Merchant Capital LP, a separate Diamond company.

Atlas Mara is a publicly traded firm that has purchased stakes in African banks and Atlas Merchant is a private-equity firm that focuses on financial industry assets in developed markets.

Also in 2014, Guggenheim had connections to an even bigger deal involving Diamond’s businesses when the Sammons insurers invested $200 million in an Atlas Merchant fund, said people with direct knowledge of the transaction. The Wall Street Journal reported on the Atlas Merchant investment last month. In another transaction from 2015, Guggenheim mutual funds bought $20 million of Atlas Mara’s debt. 

Handling Conflicts

Among the issues the SEC is examining is how Guggenheim handled potential conflicts of interest between its mutual funds and other affiliates that have direct stakes in Diamond’s businesses, the people familiar with the regulator’s inquiry said. The agency also is reviewing whether Guggenheim appropriately disclosed any conflicts to its investors, according to the people.

Guggenheim isn’t new to SEC scrutiny. In 2015, it agreed to pay a $20 million fine for allegations including not telling investors that a senior executive received a $50 million loan from one of the firm’s clients.

The Guggenheim executive was co-founder Todd Boehly, while the client who lent him money was famed bond investor Michael Milken, people familiar with the matter have said. Guggenheim, which didn’t admit or deny the SEC’s findings that the loan posed a potential conflict of interest, agreed to hire an independent compliance consultant.

Spokesmen for Boehly and Milken declined to comment.

Slumping Shares