Federal prosecutors open inquiry into Clippers-Kawhi Leonard matter

The NBA finished investigating the Clippers and Kawhi Leonard. The federal government apparently has not.

Federal prosecutors in Brooklyn have opened a criminal investigation into the secret endorsement arrangements involving Leonard and whether Clippers owner Steve Ballmer or other team officials helped facilitate them, according to The New York Times.

The investigation is reportedly in its earliest stages, and at least one subpoena has been issued. Its precise scope, potential targets and possible criminal violations remain unclear.

A federal investigation does not mean charges will be filed, and the Times did not identify Ballmer, Leonard or the Clippers as confirmed targets. Still, this is no longer just an argument over NBA rules.

The league recently fined the Clippers $30 million, stripped them of five first-round picks and suspended Ballmer for one year after determining that the organization circumvented the salary cap by initiating outside income opportunities for Leonard.

The Clippers have vehemently denied wrongdoing and intend to challenge the penalties through arbitration.

Meanwhile, Daktronics chief financial officer Howard Atkins recently disclosed that the company had received information requests from both the NBA and Securities and Exchange Commission regarding its endorsement relationship with Leonard. Daktronics said it is cooperating.

Leonard remains on the Clippers’ roster, though an agreed-upon trade sending him back to Toronto is still expected to be completed. The delay has stretched from an NBA investigation into a federal one, with the trade sitting nearby and waiting for somebody to press the button.

So much for this story being over. The NBA has delivered its verdict. Now federal prosecutors want a look at the paperwork.