5 minSports
Clippers Face Federal Criminal Probe Over Kawhi Leonard Deals After NBA Penalties
Federal prosecutors in Brooklyn have opened a criminal investigation into the Los Angeles Clippers over alleged secret sponsorship deals for Kawhi Leonard designed to circumvent the NBA salary cap, escalating a scandal that has already cost the team $30 million and five first-round picks.
Federal prosecutors have launched a criminal investigation into the Los Angeles Clippers over allegations that the team arranged undisclosed sponsorship deals for star forward Kawhi Leonard to circumvent the NBA's salary cap, according to reporting by The New York Times. The inquiry is being handled by the U.S. Attorney's Office for the Eastern District of New York in Brooklyn, the same office that has pursued major sports integrity cases involving NBA referee gambling and FIFA corruption.
The criminal probe marks a significant escalation of a scandal that has already produced some of the most severe penalties in NBA history. The league fined the Clippers $30 million, stripped the franchise of five consecutive first-round draft picks from 2029 through 2033, and suspended owner Steve Ballmer for one year. Two top Clippers executives also received suspensions. The NBA described the team's conduct as a «pattern of misconduct» following a yearlong review by the law firm Wachtell, Lipton, Rosen & Katz.
Investigators are focusing on undisclosed endorsement agreements, including a reported $28 million deal with Aspiration Partners. The green finance company later collapsed into bankruptcy, and co-founder Joe Sanberg was sentenced to 14 years in federal prison for fraud. Prosecutors are examining whether Ballmer and team executives helped facilitate side deals that compensated Leonard beyond the league's salary-cap limits. The Securities and Exchange Commission has also entered the investigation, and Daktronics, which supplied displays for the Clippers' Intuit Dome, confirmed that regulators requested records tied to its sponsorship agreements with Leonard.
A grand jury has already issued at least one subpoena in the investigation, according to The Times. Federal authorities began scrutinizing the Clippers' alleged conduct before the NBA announced its penalties, suggesting the league's own review and the criminal inquiry developed in parallel.
Leonard's uncle and manager, Dennis Robertson, received a five-year ban from the NBA, while Leonard was ordered to pay $700,000 in restitution. The Clippers have strongly rejected the NBA's findings, accusing the league of conducting a biased investigation designed to justify a predetermined narrative. «We vehemently reject the NBA's findings, which are the result of a heavily biased investigation seeking to justify a predetermined narrative rather than facts and evidence,» the franchise said in a statement. The team added that it intends to «vigorously challenge these findings and penalties through every avenue available» and looks forward to «an ethical and impartial arbitration process.»
David Kelley, Ballmer's attorney, called the NBA's investigation a «witch hunt» and a «gross injustice» in a letter to Commissioner Adam Silver. Kelley argued that league officials privately acknowledged facts that contradicted the NBA's public position. «League counsel has acknowledged in our discussions that the league does not believe there was an agreement between the Clippers and Aspiration to funnel money to Kawhi Leonard,» Kelley wrote. He also emphasized that federal authorities previously determined Ballmer was «a victim of Joe Sanberg's fraud, not a participant.»
Leonard defended his conduct while acknowledging mistakes by members of his inner circle. «Integrity and respect for this game are fundamental to who I am,» Leonard said. «I accept full responsibility for lapses in judgment by people within my inner circle and regret the distraction this situation has caused the fans and my family.» Leonard added that he entered into his Clippers contract and the other agreements «in good faith,» with no knowledge of any effort to circumvent the salary cap.
Ballmer and the Clippers are considering a federal lawsuit against the NBA to block the sanctions, but the criminal investigation could complicate that effort. Civil litigation may be delayed if key witnesses invoke their Fifth Amendment rights against self-incrimination. Spokespersons for the U.S. Attorney's Office, the Clippers and the NBA declined to comment on the investigation.
