The PGA Tour and LIV Golf haven’t yet signed a stunning partnership deal that was only announced last week, but Washington’s vows to delay or halt the deal — or at least make it uncomfortable for golf executives — crystallized on Monday, when the Senate opened an inquiry into the scheme.
Senator Richard Blumenthal, a Connecticut Democrat and the chairman of the chamber’s permanent subcommittee on investigations, said Monday he had demanded that both the PGA Tour and the Saudi Arabian-funded LIV provide a wide variety of documents and communications related to the agreement would give. Blumenthal also requested data regarding the PGA Tour’s non-profit status, suggesting a desire to challenge the tour’s tax-exempt status.
In a statement released three days before the start of the US Open in Los Angeles, Blumenthal denounced Saudi Arabia’s “deeply disturbing human rights record at home and abroad” and said the agreement prompted concern” over the Saudi government’s role in influencing this effort and the risks posed by a foreign government entity taking control of a cherished US institution.
LIV declined to comment on Monday and the PGA Tour did not immediately respond to an investigation. However, executives had indicated they expected their agreement to attract continued attention from the federal government.
Congress cannot block the deal simply by opening an investigation, and any legislation derailing the deal would most likely trigger a lawsuit. But the specter of congressional scrutiny and perhaps public hearings could tarnish the deal and make the coming months even more unpleasant for pro golf’s leaders.
Blumenthal has shown a willingness to spar with sports leaders. Lately, he has been pressuring US universities for information about their sports betting partnerships, and he has spent years lashing out at the NCAA leadership over college athlete eligibility.
While the planned deal has caused some heartburn and chatter on Capitol Hill, Congress has not shown a unanimous interest in harassing wave leaders about it. Senator Ron Johnson, the Wisconsin Republican who is the top minority member on Blumenthal’s panel, said last week that Congress should stay out of sports.
The PGA Tour’s agreement with the Saudi Public Investment Fund, whose LIV circuit debuted last year, would bring the rival tours’ business dealings into a new company. PGA Tour Commissioner Jay Monahan is in line to serve as CEO, and Yasir al-Rumayyan, the wealth fund governor, will be the chairman.
Under the terms of the agreement, the Saudi wealth fund will have exclusive rights to invest in the new company, giving it significant influence over golf’s financial future. PGA Tour officials have maintained much doubt that they will be the ultimate decision makers, as their allies will hold a majority of the new company’s board seats.
Professional golf caught the attention of Washington regulators ahead of last week’s announcement. Justice Department antitrust investigators spent months asking questions about the tour’s efforts to prevent players from defecting to LIV and investigating whether the tour’s top executives were too close to other prominent golf organizations, such as Augusta National Golf Club, the organizer of the Masters Tournament.
The department has not made any public allegations of wrongdoing and has not commented on last week’s deal announcement. But antitrust experts have warned that the department will almost certainly study it closely and may even step in to try and block it.
Tour executives have expressed confidence that the agreement will pass any legal challenges.