NBA expands investigation into Kawhi Leonard and the Clippers: another sponsorship deal and unreported expenses are under review
The NBA's investigation into the business relationships among Kawhi Leonard, LA Clippers owner Steve Ballmer and the collapsed company Aspiration is reportedly considerably broader than previously known. According to information published by The Athletic on July 14, 2026, outside investigators are no longer examining only whether Leonard's agreement with Aspiration served as a concealed method of paying additional compensation outside the salary-cap system. The investigation is also focusing on a possible second, previously unreported sponsorship deal with another company, whose identity and financial terms have not yet been made public. Investigators are also examining whether the Clippers paid certain expenses for Leonard without being reimbursed by the player or his representatives. As of July 15, none of these new allegations had been confirmed by an official NBA finding, so the matter remains open, with no final decision on responsibility.
The expanded investigation explains why the proceedings, launched in September 2025, have lasted almost a year and why Leonard's agreed return to the Toronto Raptors has been put on hold. Toronto and Los Angeles reached an agreement in principle on a trade on June 30, but the transaction was not completed after the league office informed the Raptors that, if they accepted Leonard's contract before the proceedings were concluded, they would assume the risk of possible consequences connected with the investigation. The Canadian franchise could therefore acquire a player whose contract, in the most serious and currently hypothetical scenario, might be affected by sanctions. The Raptors consequently decided to wait for the final report, while stating that they still wanted to bring Leonard back to Toronto. The Clippers also say they expect the trade to be completed once the investigation ends.
The investigation is no longer limited to Aspiration
The latest information comes from sources familiar with the work of the law firm Wachtell, Lipton, Rosen & Katz, which the NBA frequently hires for complex off-court investigations. According to The Athletic's report, investigators examined whether Leonard had another sponsorship agreement that had not previously been reported to the league and whether that arrangement involved a connection to the Clippers or people associated with the club. It has not been publicly disclosed which company the agreement was allegedly made with, how much it was worth or whether the player received any money. It is also unknown whether investigators found evidence of wrongdoing or merely broadened their review to rule out a possible violation of the rules. For that reason, the new element should not be interpreted as confirmation that an impermissible deal existed, but rather as a sign that the league is attempting to reconstruct the broader financial relationship among the player, the club, sponsors and third parties.
Another branch of the investigation concerns expenses that the Clippers allegedly paid for Leonard and for which the club may not have been reimbursed. The NBA collective bargaining agreement regulates in detail which travel, accommodation, medical and other expenses a team may cover for a player. A problem could arise if the club paid private expenses that are not permitted under the rules or if such a benefit represented additional value outside the official player contract. It is currently not publicly known what kinds of expenses were involved, during which period they were incurred or how much they were worth. Without that information, it is impossible to assess whether the matter involves administrative irregularities, permissible expenses that were subsequently accounted for or potential additional compensation.
Such a broadening of the scope also demonstrates how important it is for the NBA to distinguish legitimate marketing deals from arrangements that could undermine the salary-cap system. Players are permitted to earn money from advertising, investments and business partnerships, including deals with companies that work with their clubs. A connection between a team's sponsor and a player is not automatically prohibited. The key question is whether the club arranged, financed, guaranteed or conditioned an additional benefit in order to attract or retain the player, or to pay him value that was not recorded in the team's payroll. In Leonard's case, investigators therefore do not merely have to establish that an agreement existed, but also the nature of the relationship among all parties involved.
How the Aspiration case began
The case was opened after journalist Pablo Torre published documents and testimony from former Aspiration employees in September 2025 concerning a four-year marketing agreement worth 28 million US dollars. According to that report, the agreement was connected to a company controlled by Leonard and allowed him to receive substantial compensation in exchange for very limited promotional obligations. Former employees claimed that the deal was designed as a way for Leonard to receive additional money outside his contract with the Clippers. Those allegations raised the question of whether a formal sponsorship was actually concealing compensation connected to his playing for the club. Leonard, Ballmer and the Clippers rejected the claim that they had circumvented league rules.
Steve Ballmer was an investor in Aspiration, while the company simultaneously had a major sponsorship relationship with the Clippers. Ballmer told ESPN that the club had introduced Leonard to company representatives, but that he did not know the details of the player's agreement and had not instructed Aspiration to make the deal. He also claimed that he had personally been a victim of fraud connected with the company. The Clippers have repeatedly stated that they did not circumvent the salary cap, that they cooperated with investigators, submitted a large number of documents and made employees available for interviews. The club said it had participated in dozens of interviews and wanted the matter to be resolved conclusively.
Aspiration's financial collapse further complicated the review. The US Department of Justice announced that company co-founder Joseph Sanberg was sentenced in June 2026 to 14 years in federal prison for a years-long fraud against investors and lenders, involving at least 248 million dollars in established losses. According to court documents summarized by the department, Sanberg concealed the true source of some revenue, used fictitious clients and falsified financial data, and misled investors about the company's condition. That criminal case does not prove that the Clippers or Leonard violated NBA rules, nor was the sentence imposed because of Leonard's sponsorship agreement. Nevertheless, the company's collapse, the unavailability of some business records and separate disputes among investors may have made reconstructing all transactions more difficult and time-consuming.
Why the return to Toronto was halted
According to information from NBA.com and the Associated Press, the Raptors were supposed to receive the rights to Leonard's contract in the trade, while the Clippers would receive Brandon Ingram, Gradey Dick, two first-round draft picks, two second-round picks and future pick swaps. The agreement carried major sporting and symbolic significance because Leonard led the Raptors to their first and so far only NBA championship in his sole season with Toronto, 2018/2019. He then left for the Clippers as a free agent, becoming the central figure in an ambitious project that did not reach the NBA Finals. His planned return seven years later was supposed to reunite one of the most important players in franchise history with a team seeking to remain competitive in the Eastern Conference. Instead of presenting their returning reinforcement, both organizations are now awaiting a legal and regulatory decision.
It is important to distinguish between a formal prohibition of the trade and Toronto's decision not to assume an unknown risk. According to the Raptors' public statement, the league warned them that the consequences of an eventual decision could affect Leonard even after he changed clubs. Toronto therefore concluded that it could not complete the deal until it knew whether his contract would remain intact, whether there was a possibility of suspension or whether another sanction would reduce the value of the package for which it was giving up players and future picks. The NBA has not announced that it permanently rejected the trade or that the parties violated rules merely by reaching the agreement. The Clippers and Raptors continue to publicly leave open the possibility that the transaction will be completed after the investigation ends.
The uncertainty also affects the other players included in the package. Brandon Ingram and Gradey Dick remain tied to Toronto until the deal becomes official, even though their future roles had already been part of the two franchises' plans. The Clippers cannot fully complete their roster reconstruction without the assets they would receive in the trade, while the Raptors do not know whether they will build the roster around Leonard or retain the existing core. The delay is particularly sensitive because it is occurring during the summer period in which clubs finalize contracts, plan trades and allocate space below financial thresholds. Every additional postponement increases the operational cost of the investigation, even if no violation of the rules is ultimately established.
What the NBA collective bargaining agreement provides
Article XIII of the current collective bargaining agreement between the NBA and the players' association prohibits agreements and transactions designed to circumvent the salary cap and other fundamental rules of the system. The text specifically covers impermissible agreements among a club or a person affiliated with it, a player and a third party, as well as benefits, business opportunities or other forms of value not permitted under the contract. The rules leave room for legitimate sponsorship deals, but the league may examine whether the compensation, the services actually performed and the club's role are commercially and economically justified. In practice, it will therefore be important to determine who initiated Leonard's deals, who set the terms, what promotional obligations existed and whether the club had knowledge or influence extending beyond the permissible introduction of a player to a sponsor.
Possible penalties depend on which provision an arbitrator or the commissioner would consider to have been violated. For certain violations of Article XIII, the collective bargaining agreement allows a fine of up to 7.5 million dollars for the club, the forfeiture of draft picks, the invalidation of a transaction or player contract and, in certain circumstances, a fine of up to 350,000 dollars for the player. It also provides for the possible suspension of club personnel for up to one year if intentional participation is established. Maximum penalties differ for other types of violations, and a decision may be issued only after the prescribed proceedings and possible appeals. The mere fact that these measures are provided for does not mean they will be imposed in this case.
The invalidation of Leonard's contract would be the most dramatic outcome, but such a decision would require responsibility by the relevant parties to be established under the rules of the collective bargaining agreement. Commissioner Adam Silver previously emphasized that the burden of proof is on the league and that a decision cannot be based only on an impression or an unusual business structure. In June 2026, he said that the outside investigation was at an advanced stage and that it was time to bring the proceedings to a conclusion, while also stressing that reaching the correct decision was more important than reaching a quick one. As of July 15, the NBA had not announced an official deadline for completion or released a public summary of the evidence collected. Consequently, all scenarios, from complete exoneration to serious sanctions, remain merely possibilities.
The decision will have consequences beyond a single trade
The outcome will be important for all 30 NBA clubs because it will show how the league interprets the boundary between permissible commercial opportunities and concealed compensation. In the modern NBA economy, owners, players, sponsors and investment funds often participate in the same business networks, so a simple prohibition of every overlap is unrealistic. At the same time, the salary-cap system loses its purpose if a club can use an affiliated sponsor to offer a star millions that competitors cannot show in an official contract. The league must therefore establish a standard that punishes actual circumvention without treating every legitimate marketing deal as suspicious. Leonard's case could become a precedent for future examinations of ownership investments, sponsorship relationships and players' business agreements.
For now, there is no official proof that Leonard, Ballmer or the Clippers committed a violation. There are serious allegations, documented financial relationships and a prolonged investigation, but a final conclusion has yet to be reached. The latest findings concerning another possible sponsorship deal and paid expenses show that investigators do not want to limit the case to one company and one agreement. That also increases the number of questions the final report must answer before Toronto and Los Angeles can safely complete the trade. Until that happens, Leonard remains a Clippers player, his return to the Raptors remains only an agreement in principle, and one of the biggest stories of the 2026 NBA summer remains off the court.
Sources:
- The Athletic – report on the expansion of the investigation to another possible sponsorship agreement and expenses allegedly covered by the Clippers (link)
- NBA.com / Associated Press – officially confirmed suspension of the trade between the Raptors and Clippers and public statements by the two franchises (link)
- National Basketball Players Association – current NBA collective bargaining agreement, Article XIII on circumvention of the rules and possible penalties (link)
- NBA.com – statements by Commissioner Adam Silver on the progress of the investigation and the need to conclude the proceedings (link)
- ESPN – interview with Steve Ballmer about the Clippers' relationship with Aspiration and his rejection of claims that the salary cap was circumvented (link)
- US Department of Justice – official information on Joseph Sanberg's sentence and the fraud connected with Aspiration (link)