The National Basketball Association (NBA) announced it will investigate a potential salary cap violation involving Los Angeles Clippers star Kawhi Leonard and a now-bankrupt sustainability company, Aspiration Fund Adviser, LLC. The probe follows a report alleging the endorsement deal circumvented league regulations.
Clippers ownership strongly refuted the allegations. They emphasized their cooperation with the NBA‘s investigation and maintained that all actions were compliant with league rules.
The focus of the investigation centers on the relationship between Leonard, the Clippers, and Aspiration. Aspiration, which filed for bankruptcy earlier this year, listed the Clippers and a company managed by Leonard, KL2 Aspire LLC, among its creditors. KL2 Aspire LLC was owed approximately $7 million.
NBA spokesman Mike Bass confirmed the league’s investigation, stating that they were aware of the report and had initiated a formal review.
Clippers owner Steve Ballmer‘s significant investment in Aspiration, coupled with a substantial partnership between the company and the team, is also a key element of the investigation. This partnership, announced in September 2021, came shortly after Leonard signed a lucrative contract extension with the Clippers.
The Clippers terminated their relationship with Aspiration after two years, citing a breach of contract. The team further clarified that neither Ballmer nor the Clippers organization had any involvement in Leonard‘s individual endorsement agreement with Aspiration.
Joseph Sanberg, co-founder of Aspiration, recently pleaded guilty to federal wire fraud charges. Prosecutors revealed that he defrauded investors and lenders of a substantial amount of money, and that Aspiration‘s financial reporting was significantly inaccurate.
The endorsement deal between Leonard and Aspiration stipulated annual payments of $7 million over four years. However, there’s no evidence suggesting Leonard publicly promoted Aspiration. The Clippers maintained that such endorsement deals with players are common practice and are typically independent of team oversight.
The NBA‘s investigation could result in significant penalties for the Clippers if violations are found. These penalties could include substantial fines, contract nullification, and the forfeiture of future draft picks. The league has previously investigated similar allegations concerning Leonard‘s representation during free agency negotiations several years ago.
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