Few players in the NBA command respect the way Kawhi Leonard does. Soft-spoken but dominant, the two-time champion and Finals MVP built his legacy on defense, efficiency and championships before becoming the cornerstone of the Los Angeles Clippers in 2019.
Now, Leonard’s off-court image is under the spotlight. The NBA has launched a formal investigation into the Clippers and their star forward after reports alleged that the team funneled millions of dollars to Leonard through a sponsorship deal designed to bypass salary cap restrictions. The case, if proven, could represent one of the league’s most significant violations of its financial rules in decades.
The controversy centers on Aspiration, a financial services start-up that filed for bankruptcy in March 2025 after co-founder Joe Sanberg pleaded guilty to fraud. Clippers owner Steve Ballmer invested roughly $50 million into the company, while minority owner Dennis Wong added nearly $2 million. Days after Wong’s investment in 2021, Leonard’s company received a $1.75 million payment from Aspiration. By April 2022, Leonard signed a four-year, $28 million endorsement contract with the firm through KL2 Aspire, an LLC owned by Leonard, with the agreement reportedly contingent upon his continued service with the Clippers.
Investigative journalist Pablo Torre reported that Leonard performed little to no promotional work for the company, calling the arrangement a “no-show” deal. Torre also uncovered evidence of a secret $20 million side agreement that would have pushed Leonard’s total compensation close to Ballmer’s investment in Aspiration. A former Aspiration employee told Torre’s podcast that the payment was to circumvent the salary cap.
Former Aspiration CEO Andrei Cherny rejected that claim in Sports Business Journal.
“The contract had three pages of extensive obligations and could be terminated for non-performance,” Cherny said.
The NBA’s Collective Bargaining Agreement (CBA) makes clear that teams and their affiliates cannot arrange third-party contracts that effectively serve as disguised salary. Such arrangements are especially problematic if the compensation is far above market value or tied to the player’s continued presence with the team. While players are free to sign endorsement deals, the league forbids agreements that link those payments directly to their team service.
This is not the first time the Clippers have faced scrutiny under Ballmer. In 2015, the team was fined $250,000 for offering DeAndre Jordan an unauthorized endorsement deal with Lexus. When Leonard signed with the Clippers in 2019, reports surfaced that his uncle requested improper benefits during negotiations, such as ownership stakes, private planes and guaranteed endorsement money. The league investigated but found no evidence that the Clippers met those requests.
Historical precedent shows the league is willing to impose severe penalties in cases of circumvention. The most famous example is the Joe Smith case in 1999, when the Minnesota Timberwolves secretly structured contracts to allow Smith to sign below-market deals and later re-sign for a much larger contract once the team had his Larry Bird exception, or a salary cap rule that permits teams to re-sign their own players even if doing so pushes them over the cap limit. The NBA discovered the scheme and handed down a historic punishment: a $3.5 million fine, the loss of multiple first-round draft picks and the voiding of Smith’s contracts.
Other examples exist, though few have resulted in proven violations. In the mid-1990s, superagent David Falk explored a plan to have Michael Jordan sign an endorsement with Sheraton Hotels, which was owned by the same company as the New York Knicks, in order to entice him in free agency. The deal never came to fruition. Such schemes are rare, but even rumors of them show why the NBA treats salary cap circumvention as a serious threat to competitive balance. Commissioner Adam Silver promised a thorough investigation in the New York Post.
“We are going to get to the bottom of it … [we’re] bringing out the big guns,” Silver said.
The league has retained New York law firm Wachtell, Lipton, Rosen & Katz to investigate. If violations are proven, the penalties could be steep. The CBA allows fines of up to $7.5 million, suspension of personnel for up to one year, the voiding of contracts and — most importantly — the forfeiture of first-round draft picks. Because the number of draft picks lost is left to the NBA commissioner’s discretion, the punishment could seriously hurt the Clippers’ future.
The Clippers strongly denied any wrongdoing in a public statement.
“Neither Mr. Ballmer nor the Clippers circumvented the salary cap or engaged in misconduct related to Aspiration,” the team said.
They emphasized that the organization ended its relationship with Aspiration during the 2022–23 season and had “no oversight of Kawhi’s independent endorsement agreement.” Ballmer himself told ESPN’s SportsCenter that while the team introduced Leonard to the company, it had no role in the contract.
Some around the league have publicly defended Ballmer. Former Mavericks owner Mark Cuban believes that Ballmer was scammed by Aspiration and had no wrongdoing.
“As much as I wish they circumvented the salary cap, [first of all] Steve isn’t that dumb,” Cuban said on X.
For Leonard, the scandal is a stark departure from his usual reputation as a quiet professional focused solely on basketball. The NBA’s findings, expected in 2026, will determine whether this case becomes a footnote or a turning point in how the league enforces its salary cap.
