Why is Dan Snyder under federal investigation? Commanders owner facing heat over potentially fraudulent $55 million loan

Dan Snyder finds himself in the headlines once again, this time for a possible loan of $55 million. The Washington Commanders owner's separation from his longtime minority partners in the franchise started with an annotation in a financial report back in April 2020.

That annotation uncovered a credit line of $55 million that the franchise had taken out over a year ago without the understanding and necessary consent of the minority partners. Per documents from ESPN, the three billionaires owned 40 per cent of the franchise.

The covert $55 million loan has become the main target of federal prosecutors in Virginia who are looking into claims of fiscal wrongdoing by Dan Snyder and the Commanders, several sources with direct knowledge of the investigation told ESPN.

Documents collected by ESPN show that minority partners Robert Rothman, Dwight Schar, and Frederick W. Smith objected to the loan after they found out about it in the financial report's fine print.

They then began examining deep into the team's finances and discovered Dan Snyder was using the team as his "personal piggy bank" in an arbitration petition filed with the NFL. This included charging the Commanders $4.5 million to put the team's logo on his private jet.

The counsel and a spokesperson for the Commanders, John Brownlee, refused to respond to any questions regarding the $55 million credit line. Instead, a statement was released noting the team's cooperation with the state of Virginia.

Brownlee said:

"The team has been fully cooperating with the Eastern District of Virginia since it received a request for records last year. The requested records only relate to customer security deposits and the team's ticket sales and revenue. The team will continue to cooperate with this investigation."

A spokesman for the U.S. Attorney's Office for the Eastern District of Virginia declined to comment to ESPN about the matter. However, the NFL did respond to the matter via a statement of its own.

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The NFL's statement on loan and Dan Snyder'spotential legal woes

The league did not make Commissioner Roger Goodell available for an interview. Still, NFL spokesman Brian McCarthy released a statement regarding the issue between Dan Snyder and the minority partners.

McCarthy said:

"The parties had a series of disputes, which were certified to the Commissioner for arbitration as required by league rules. The Commissioner appointed a highly-respected attorney as the arbitrator and none of the parties objected to that appointment.

"After several months, the parties were asked if they would be interested in participating in a confidential mediation with the Commissioner, which they agreed to do."

McCarthy added:

"The mediation lasted for two days and the parties subsequently reached an agreement whereby the three limited partners sold all of their interests in the team to Mr. Snyder at an agreed-upon price and other terms.

Everyone was represented by very sophisticated legal and financial advisors. The agreement included full releases of all claims that were or could have been asserted by any party in the arbitration proceeding."

McCarthy declined to answer further questions, including whether the NFL has received any subpoenas connected to the criminal inquiry. We will see if the NFL does become involved in another matter involving Dan Snyder

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If you use any of the above quotes, please credit ESPN and H/T Sportskeeda.