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After a report surfaced in early 2024, highlighting possible misconduct related to an endorsement arrangement tied to Kawhi Leonard’s contract extension with the Los Angeles Clippers, team owner Steve Ballmer engaged in a conversation with ESPN to clarify his involvement in the matter, emphasizing the necessity for the NBA to probe the claims.
“The integrity of the salary cap rules is critical for the league, and I believe an investigation is warranted,” he stated.
The situation, brought to light by Pablo Torre of The Athletic on Wednesday, raises suspicions of circumventing various regulations, which may amount to a breach of salary-cap regulations, thus justifying a league inquiry. Specifically, it involves a $50 million investment into the now-defunct firm, Aspiration, by Ballmer, alongside an atypical $28 million endorsement agreement with Leonard.
“These individuals committed deception. They tricked me,” the 69-year-old billionaire expressed, reflecting on the ordeal. “I made an investment in good faith, thinking everything was legitimate, only to be misled. I can’t speculate on their motives, especially concerning the contract with Kawhi.”
He elaborated on the scrutiny of the company’s finances, stating, “I went through, and my team primarily assessed fraudulent financial statements. Should I have detected the fraud? Perhaps I should feel ashamed and foolish for not catching it, but I didn’t.”
At the midway point of the 2023-24 season, the Clippers finalized a $153 million three-year contract extension with the two-time NBA champion, which subsequently resulted in an additional endorsement contract.
“We were finished with both Kawhi and Aspiration. All agreements were in place,” Ballmer remarked. “However, they sought to be introduced to Kawhi. According to regulations, we may introduce our sponsors to our players, as long as we don’t engage in the negotiations.”
“The allegations are unfounded. Most importantly, we have acted correctly in all our dealings. Kawhi’s business interests are his own, but we have always conducted ourselves appropriately,” he affirmed, reaffirming the Clippers’ official stance.
In a prior statement to The Athletic and The Los Angeles Times, the team emphasized, “Neither the Clippers nor Steve Ballmer have violated salary cap regulations. The assertion that Steve’s investment in Aspiration was an attempt to distribute money to Kawhi Leonard is ludicrous. Steve invested because Aspiration’s co-founders claimed they were dedicated to responsible customer service and environmental stewardship.
Following extensive market manipulation that deceived Steve, along with multiple investors and sports organizations, Aspiration entered bankruptcy. Its co-founder, Joseph Sanberg, recently admitted guilt to fraud totaling $243 million. Neither Steve nor the Clippers were aware of any misconduct by Aspiration or its co-founder until the government began its investigation. Aspiration served as a team sponsor for the 2021-22 and 2022-23 seasons before failing to meet contractual obligations.
There is nothing improper about team sponsors engaging in endorsement deals with players simultaneously. Neither Steve nor the Clippers had any oversight of Kawhi’s separate endorsement agreement with Aspiration. Claims to the contrary are entirely inaccurate.
The Clippers are committed to NBA compliance, highly regard the league’s guidelines, and welcome the investigation concerning Aspiration. They will continue to assist law enforcement in its inquiry into Aspiration’s overt fraudulent practices.”
Aspiration declared bankruptcy in March. In late August, co-founder Joe Sanberg admitted guilt to two counts of wire fraud.
