Clippers wing Kawhi Leonard found himself the subject of unwanted scrutiny Wednesday, when it was reported by Pablo Torre on his “Pablo Torre Finds Out” podcast that the six-time All-Star had inked a $28MM endorsement deal for “tree brokerage” Aspiration, a former team sponsor that filed for bankruptcy earlier this year. L.A. owner Steve Ballmer invested $50MM into the company.
The 6’7″ swingman reportedly didn’t do any work for the allegedly phony tree-planting company, leading to speculation that the endorsement agreement was a route for Leonard to earn additional money on top of his NBA salary in a manner that would have helped L.A. circumvent the salary cap. Other involved celebrities, including movie stars Leonardo DiCaprio and Robert Downey Jr., apparently did perform actual work for Aspiration.
The NBA is now investigating the situation to determine if there was indeed any impropriety.
The Clippers initially released statements to Torre and then to The Los Angeles Times denying any wrongdoing. Now, the team has issued an extended denial, as Shams Charania of ESPN (Twitter link) relays.
“Neither the Clippers nor Steve Ballmer circumvented the salary cap,” the Clippers’ statement reads. “The notion that Steve invested in Aspiration in order to funnel money to Kawhi Leonard is absurd. Steve invested because Aspiration’s co-founders presented themselves as committed to doing right by their customers while protecting the environment.
“After a long campaign of market manipulation, which defrauded not only Steve but numerous other investors and sports teams, Aspiration filed for bankruptcy. Its co-founder, Joseph Sanberg, recently pleaded guilty to a $243 million fraud. Neither Steve nor the Clippers had knowledge of any improper activity by Aspiration or its co-founder until after the government initiated its investigation. Aspiration was a team sponsor for the 2021/22 and 2022/23 seasons before defaulting on its contract.
“There is nothing unusual or untoward about team sponsors doing endorsement deals with players on the same time. Neither Steve nor the Clippers organization had any oversight of Kawhi’s independent endorsement agreement with Aspiration. To say otherwise is flat-out wrong.”
“The Clippers take NBA compliance extremely seriously, fully respect the league’s rules, and welcome its investigation related to Aspiration. The Clippers will also continue to cooperate with law enforcement in its investigation into Aspiration’s blatantly fraudulent activity.”
Torre responded to the Clippers’ claims (via Twitter), standing by his reporting and challenging some of the language in the Clippers’ statement.
Torre might get himself in trouble.
This seems like something that shouldn’t even be allowed to begin with — in any sport. There’s a conflict of interest involved. And it would be way too easy to do this in order to circumvent the salary cap.
If nothing else, there should be some strict oversight in place.
From hearing Torre do an interview it sounds like other teams may already be doing this. The league may try to bury it so it doesnt come out the others up to these no show endorsement deals.
The NBA is going to kill their league if they don’t get their house in order and keep things on the up and up. Ratings are projected to drop again because you need like 5 different subscriptions now to watch games. And anyone who thinks that corruption like this can’t harm them just remember sports like boxing, NASCAR, and horse racing were all very popular in the US at one point or another and cheating and corruption ruined it for all of them.
I find this to be extremely false.
NASCAR, Boxing, and Horse racing are all extremely popular still to this day. Also, they all are individual sports so comparing them to any team sport is an apples to oranges argument.
Additionally, Im almost positive that this season will have more games on broadcast television than any season previously? And on top of that, you literally need just one subscription (League Pass) to watch every game, minus blackout restrictions obviously which are absolutely archaic at this point.
I think a much better comparison would be comparing the MLBs sign stealing scandal that happened a couple years back. And Im not sure if you’ve noticed but the MLB is more popular than it has been in 2 decades. You can site rule changes as the main driver for MLBs increased popularity to which I would ask you to look at what Silver has been doing for the last 5 years in regard to rule changes.
The NBA will be just fine.
They are popular somewhat but not anywhere near what they used to be. There were several times in history boxing and horse racing were THE most popular sports in America. NASCAR at one point was the fastest growing sport. If you think the NBA can remain as popular as it is with 17 different subscriptions, players that don’t play, and rigged teams breaking the rules you’re in for an unfortunate surprise. Even Marc Cuban recently talked about how the new era of owners don’t factor what fans want into decisions anymore.
Again, you only need one subscription. And if you don’t want to do that, a basic cable package gives you much more games now than it did previously.
If the NBA itself was to blame for this you might have a point but they aren’t. Steve Ballmer is. Cuban is also a hilarious goal post. Cuban got cut out of his own team and continues to lie about how it happened. A guy who has been super anti-NBA since his departure isn’t the best example.
Happens everywhere, your team included. In my country there is a salary cap…..apparently. yet third payments don’t come under the cap. This isn’t new. Steph, Bron etc etc and the list would be crazy long. This is a total non event. It’s the investors that got F’ed over and scammed, including the Clippers owner.
Yeah something about this doesn’t seem right and has a real amateur journalist feel to it. It seems like he got just the right amount of information to say “gotcha” and then stopped digging. There’s no way Ballmer would be this stupid. The Kawhi part is still weird and suspect but I doubt this was an arrangement with the Clips and Kawhi.
That’s probably just the information they have so far. I’d assume eventually there will be more to the story
He’s got 7 sources inside this company. Either the story is basically accurate, or he’s made up everything including the sources. I got my money on the former. Ballmer just doesn’t think Torres can prove it enough to overcome the league’s fundamental corruption instincts, which may be a good bet.
The league also doesnt have subpoena power to dig deeper so we will see what they feel meets the threshold for proof. They can force Ballmer and his execs to turn over any documents they have.
He spent 7 months on this and still has a ton of stuff. A lot of new stuff coming in for him since the story broke. Like he has the contracts, and a bunch of other documents. He interviewed at least 7 people working at the company on the record. Like WTF do you want. F***ing amateur commenter, professional journalist.
Professional journalist…hahaha classic. Apart from loving the Lakers and Warriors what actual need is there to try bring down the mighty L.A clippers? Ballmer is just an investor, it’s not his company. Many other investors too.The companies founder who admitted guilt to fraud (Not Ballmer) mights have a little issue. Oh no, Kawhi didn’t do any work which lead to speculation by Torre this was to circumnavigate the cap. Torre needs to tread lightly with this 100%. That’s all this is, speculation and a non story for clicks. Because I’m sure Torre has seen the agreement between the parties involved. Name dropping Hollywood celebs who (Apparently) did work is cute. Just all more attention seeking.
You need to prevent teams from back channeling 28M dollars to a player outside the cap rules.
If you get paid a pile of money for no work something is fishy. Yes?
Its relevant to point out that other celebrity endorsers actually actively promoted the thing they were paid to do.
Ballmer paid the company 50M at an inflated rate for shares. The company turned around and gave Kawhi a 28M contract, and a reported 20M in equity. If it walks like a duck and quacks like a duck, that duck is probably breaking the cap rules.
Seems like good investigative journalism. I dont know much of Torres work before this, but he has worked at several publications that are professionally respected. He also sounds very credible when going into great detail about the situation.
The funny thing is, if Pablo Torre was still an ESPN company man, we’d probably never have gotten this story
Let’s be real – $28m to endorse a tree planting company is absolutely circumventing the cap. A couple of million? Sure, that can slide..but that figure is just ridiculous. There’s no way the NBA can look at this and call it legitimate.
Ballmer got greedy and figured the worst he’d get is a financial slap on the wrist, which he can afford. Hit him with picks, minimum.
He literally did nothing. No press release when he signed it. Like dude did zero with aspiration but cash their checks, and all the people who worked at the company confirmed it.
Agree with this. He got too much money and did far too little (0) to justify it and there are insiders stating on the record that the money was from Clips. They had better lose some picks for this bs.
I take issue with your argument that a couple million is fine but 28 is too much.
Why are you okay with the principle of cheating the league as long as someone’s pockets don’t get TOO full?
Its much harder to prove that you didnt provide fair value on the contract if your paid less. If your paid a lot and do literally nothing its easier to prove shenanigans. Its not that less is less of a violation, its that if your paid a million and do a small amount of perfunctory promotion its hard to prove you didnt earn your money legitimately.
Now I do think that the NBA should just make this easy and say no player can be paid by a team sponsor. You could maybe have a threshold where its only major sponsors, not just someone who puts up some advertising in the lobbies.
This may either end up being a nothing burger or a possible serious fraud issue outside of the NBA for Ballmer.
Aspiration got $250 million from all investors, but only $50 million from Ballmer. If Aspiration gave Kwai $28 million for nothing, and they spent money on sponsoring the Clippers, then the other investors can come after Ballmer.
The Fed can potentially get involved if they figure a crime (fraud) was committed Also, if Ballmer claimed this as donation for a worthy cause only for that money to be going to his personal interests that’s tax fraud.
And if Ballmer has all that exposure in this thing, would he allow Aspiration to go bankrupt, so everything becomes public?
A deep dive into who all the other creditors are will be interesting. That’s outside the NBA jurisdiction, and hopefully the Fed that convicted the director of Aspiration for fraud is looking into the whole thing. This might be the start of something huge that extends beyond Ballmer.
I mean, this is huge. The Timberwolves got five first round picks taken away, their GM and coach banned for a year, and a huge fine when they just promised to pay Joe Smith more in future years (which just about every team does now – but keeps it on the low). Here there is a paper trail of the Clippers clearly circumventing the cap, in a time when they are making it harder to go and pay the luxury tax in the name of competitiveness. Silver said multiple times at the Draft about how he wants to make the NBA more competitive and take away the power of spending teams like the Warriors.
Ballmer having way more money than all the other owners is going to get a huge reaction out of the other owners, because they could never compete with Ballmer giving out under the table contracts to this extent. There’s a difference between introducing a player to companies that can give them huge endorsement $$$, and directly funneling $$$ through an LLC you just created to another LLC.
The NBA (and therefore the owners who don’t spend the tax) are losing a lot of tax money from this as well. There’s no way the NBA and the other owners will let this stand because it hurts their OWN bottom line, but they aren’t going to just attack their richest owner without A LOT more information…
And yes, as you say, this is a case of fraud, I’m sure there will be additional federal investigations as well…but Ballmer is a tech guy, and they are given free passes all the time now.
This happened before new cap rules. Get it right. Don’t be like @aristotle. And just make stuff up to give your post substance.
Al – The Brunson deal looks a little more interesting now…
Don’t get swept away by false esp- …. He did Knicks a favor. Just a local kid who understands the hunger in his sports town lol. More players should be like him. Bridges did it too. We just got good guys man.
Bullseye….
Great analysis, nothing mid about this take, Captain. As a Warriors fan, knowing the NBA watches over them like hawks and even creates new aprons because of the KD era Warriors, even though 2019 proved stacking the roster top-heavy doesn’t mean a title and having the longest and best bench does – kind of infuriating watching the Clippers, Dallas and Lakers doing whatever they want when it comes to roster manipulation.
There was a paper trail with Smith because they were thinking of selling the team, and he wanted the backroom deal in writing to cover his ass. The league got their hands on the deal in writing.
Yepp. Ballmer’s Boggle is also in writing through the LLC contract. Plenty of paper trail there to nail him to the wall
Honestly, I believe it
Steve Ballmer is so rich that paying whatever salary tax wouldnt hurt (and he has paid some hefty taxes over the years)
Like he spent billions on a new arena, why would he have to do this
Because no matter how rich you are once your over the apron you cant sign FA other than mins. Like this is an artificial environment with a soft salary cap, and major restrictions over a certain point.
Would Ballmer just spend till he won if allowed like MLB? Sure. You cant do that in the NBA, so this lets you keep money your paying players off your books and artificially lowers your cap hit.
That makes some sense but apron rules became valid last year, I had the impression this deal was before that
Also, why this company? That would go bankrupt in a couple of years? Idk I dont think this is as easy as it looks
You were still limited to a single 5M tax payer MLE, and mins. This isnt MLB where you can just go all Dodgers and raise payroll as much as you want to get whoever. So even though he is rich Ballmer couldnt put it to his advantage in NBA CBA rules.
This company was a bad choice. None of this would have come out if the bankruptcy hadnt happened. People are often stupid and thats how they get caught. Also a company willing to back channel millions of dollars for you is automatically going to be on the shadier side. Like a legit company wouldnt be willing to do this.
This is dumb as fk. Ballmer is going to end up dealing with a federal investigation just to keep a guy that doesn’t ever play a full season!
The 30 for 30 on the Ballmer clippers is going to be a really good episode.
The worst trade in nba history
Bad signing after bad signing
0 trophies
Mostly just guys in street clothes
Then all of a sudden harden comes and revitalizes things
Only to find out your owner has been committing fraud the whole time with a guy who rarely played. Which costs the franchise numerous first round picks and a hefty fine….once again sending the clippers back to the bottom of the nba again.
“The worst trade in nba history” its actually funny that AD for Luka still isn’t as bad as EITHER SGA trade:
SGA for Miles Bridges and two 2nds on Draft Night (horrible)
SGA, Gallinari, and five first rounders for Paul George (even worse) (literally caused OKC to win a title)
You can’t spell Kawhi Leonard without NIL. This reeks of most of the college NIL deals to endorse or work with companies without actually doing any work to justify the $$$.
But in this case, they are taking money out of the owners pockets as this is money Ballmer doesn’t have to pay an NBA tax on. Something that will actually see consequences since rich people are affected
Did anyone think they would admit to cheating? Of course not.
Rich people’s problems. Why exactly do we care ??
Ballmer is best thing ever happen to Clippers ….
Sterling knows that. Wake me when it’s over.
“We investigated ourselves and found we did nothing wrong” – cops, politicians, wealthy people. On repeat. The last 30 years.
Talk ball or don’t talk Davey
We all should wait for all the facts. The guy has pleaded guilty to defrauding Ballmer and others. Nothing wrong with looking out for players and endorsement money. In the old days. The only way you made money. Was by local endorsement money. It could add up to more than salary. Lets wait for all facts …..
1. Other than forcing a sale of the team, Steve won’t feel any impact from any fine. Will taking draft picks hurt? Sure, but people will still go to games it’s LA.
2. Was this a circumvent of the cap? 110%. An LLC created just to funnel the money is insane work.
3. Punishment? So taking away draft picks means 1 less player gets the rookie scale contract. I think they should take away the draft picks I’d say 3 at least, but figure out a way to distribute them to another team. Like a playoff team lottery, the pick is automatically the 30th pick – non weighted odds everyone is even. Team that wins the playoff lottery gets the pick, no team can get it twice. I think you could sell this to the players association, and I think it’s fair to the rest of the league. The Clippers had an unfair advantage.
4. I don’t think they should void his contract. I think they should deduct 21M though, still counts against the cap. I think they should recalculate the Clippers luxury tax for the years he was paid 7M and that goes on top of the fine.
1. Ballmer could be banned for some period so he wont be allowed to come sit court side at his favorite thing. For an ultra rich billionaire losing his privileges can be a painful punishment.
3. If you take picks they can be into the future past 7 years, so this older team cant rebuild for forever. You could also limit them to say 20M salary on FA contracts for the next 5 years so that they cant use the cap space to sign top FA. It would be a fitting punishment for a team breaking the cap rules.
4. They could void his current contract and make him a FA yes, but they are also allowed it seems to claw back the money he has been paid since ’21, so it could cost Kawhi hundreds of millions hes earned the last 4 years plus his 2 remaining years.