The NBA dropped a historic hammer on the LA Clippers this month. Five first-round picks gone. A $30 million fine. The owner suspended for a year. And that may turn out to be the good news.
On Sept. 2 the league announced the findings of its investigation into salary cap circumvention involving Kawhi Leonard. Nine days later came reports that the Justice Department had opened a criminal investigation into the same conduct. One of those things can be absorbed and moved past. The other one puts people in federal court.
What the league actually found
Investigators concluded the Clippers funneled off-court endorsement money to Leonard through team business partners, including Aspiration Partners, Boingo Wireless, Daktronics and Lockton Insurance. Owner Steve Ballmer was suspended from all league and team activities for one year for knowingly seeking to help Leonard obtain off-court income, and for approving a business deal he knew was a precondition for Aspiration entering an endorsement agreement with Leonard.
President of business operations Gillian Zucker was suspended a year without pay. The league called her primarily and directly culpable for the endorsement arrangements and said she lied to investigators. President of basketball operations Lawrence Frank drew six months without pay for his involvement and for approving impermissible expenses incurred by Leonard and his family. Leonard was ordered to pay the league $700,000.
The draft capital is the piece that actually alters the franchise: Los Angeles forfeits first-round picks in 2029, 2030, 2031, 2032 and 2033. Adam Silver said at last week’s Board of Governors meeting that the penalties are final and that he expects Ballmer to return in good standing once the suspension ends. Silver cited precedent, noting the Timberwolves were once docked five picks for cap circumvention, and said this punishment had to go directly to competition.
The part Ballmer cannot write a check for
Now the federal layer. Prosecutors in the U.S. Attorney’s Office for the Eastern District of New York, based in Brooklyn, have opened a criminal probe into how the Clippers allegedly arranged those sponsorship contracts. At least one subpoena has already gone out. The probe is reportedly in its earliest stages, and the conduct in question could be examined as fraud, conspiracy or money laundering.
That office has run plenty of high-profile sports prosecutions. It does not care about competitive balance, does not report to the Board of Governors, and will not be satisfied by a fine that is a rounding error for the wealthiest owner in American sports.
There is also a witness problem. Aspiration co-founder Joseph Sanberg was sentenced in June to 14 years in prison for wire fraud. A man serving 14 years has enormous incentive to explain, in granular detail, how arrangements like this one got built.
Where this goes next
The basketball cleanup is already underway. Leonard’s long-delayed trade to Toronto finally closed on Sept. 14, with the Clippers receiving Brandon Ingram, Gradey Dick, two first-round picks, two seconds and a swap. The roster page is turning.
The legal page is not. Silver can declare the league’s penalties final, and he did exactly that. Federal prosecutors are not bound by that declaration, and they are asking a different question entirely: whether a crime occurred.
Take the picks. Take the fine. Take the suspensions. The Clippers would sign for every bit of it tomorrow if it made Brooklyn go away.
A longtime sports reporter, Carlos Garcia has written about some of the biggest and most notable athletic events of the last 5 years. He has been credentialed to cover MLS, NBA and MLB games all over the United States. His work has been published on Fox Sports, Bleacher Report, AOL and the Washington Post.