NBA Suspends Steve Ballmer Following Investigation into Corruption Scandal
Steve Ballmer, the owner of the Los Angeles Clippers and former Microsoft CEO, has been suspended by the NBA for one year. This follows the conclusion of an investigation that revealed deceptive practices involving a $28 million endorsement deal for player Kawhi Leonard, and improper financial dealings related to the construction of the Clippers’ new arena.
Investigation Reveals Truth Behind Endorsement Deal
The NBA report, compiled by law firm Wachtell, Lipton, Rosen & Katz, contradicted Ballmer’s prior denial of the team’s involvement in the questionable agreement with Leonard. The report labeled Ballmer’s claims as “inaccurate,” and described statements from Gillian Zucker, Clippers’ president of business operations, as “clearly false.” Consequently, Zucker also faces a one-year suspension. In addition, Leonard has agreed to a $700,000 fine, and his business manager has been banned.
Financial Implications for the Clippers
As part of the sanctions, the Clippers are set to forfeit five future draft picks and pay a $30 million fine. Ballmer estimates the legal costs of the investigation at $50 million, while his reputation and partnerships, including with Daktronics, have also suffered. The investigation was sparked by journalist Pablo Torre’s podcast, which tackled the alleged corruption within the Clippers’ operations.
Unveiling Connections and Deceptive Arrangements
The NBA’s findings highlighted how Daktronics was implicated in creating additional earnings for Leonard through endorsement deals tied to the arena’s prominent new scoreboard. Further complexities emerged as the investigation pointed to interactions with Aspiration, a fintech firm that played a crucial role in heightening Leonard’s earnings beyond the salary cap through dubious means.
Investigators disclosed that Aspiration, alongside Daktronics, engaged with the Clippers’ executives on misleading payments. Joe Sanberg, co-founder of Aspiration, is currently serving a 14-year prison sentence for fraud related to fake revenue streams that misled investors by $248 million.
Continued Investigations and Potential Legal Actions
Despite the significant revelations, the investigation continues, focusing on additional claims, including one suggesting a consulting agreement was used as a cover for extra payments to Leonard. Meanwhile, Ballmer’s legal team insists on exploring options to counter what they describe as a “gross injustice.”
Reporting based on coverage first published by theverge.com.