The planned trade of Kawhi Leonard from the Los Angeles Clippers back to the Toronto Raptors has been halted due to an ongoing NBA investigation into the Clippers and allegations of salary-cap circumvention. The Raptors are currently unwilling to proceed with the deal unless they are absolved of any risk associated with potential penalties arising from the league's probe.
The Clippers issued a statement after reports surfaced that the trade, agreed to in principle on June 30, was delayed. According to the team, the deal cannot be finalized unless Toronto's ownership group agrees to absorb the risk of any sanctions connected to Leonard's contract that might emerge from the NBA investigation. The Raptors stated that the league office informed them they would assume this risk, leading Toronto to decide to wait for the investigation's conclusion before moving forward.
"The Raptors remain eager to bring Kawhi back to Toronto and look forward to a swift resolution for our players, our organization, and our fans," the team said in a statement. This leaves Leonard in limbo, with his exit plan from Los Angeles unfinished and his potential reunion with the Raptors on hold.
The Clippers have consistently denied any wrongdoing. "For the past 10 months, our organization has fully cooperated with an NBA investigation," the team stated, detailing their participation in numerous interviews and the provision of extensive documentation. The team also specifically denied funneling money to Leonard through Aspiration, a now-defunct green banking company.
At the center of the NBA's investigation is Aspiration, co-founded by Joe Sanberg, who has pleaded guilty to federal fraud charges related to defrauding investors. The Clippers have described Sanberg as the architect of a fraudulent scheme that impacted Steve Ballmer, the Clippers' owner, who claims he lost $60 million on his investment in Aspiration. Ballmer's attorney also stated the Clippers lost a $300 million sponsorship deal and approximately $20 million in carbon offset purchases related to the company.
The NBA's core concern is Leonard's reported $28 million endorsement deal with Aspiration. While players are permitted outside endorsement agreements, the league is examining whether the Clippers or Ballmer were involved in arranging this deal as a form of compensation outside the salary cap, which would constitute a serious violation.
The NBA launched its investigation in September 2025 following reports questioning the connection between Leonard's Aspiration deal and the Clippers. The probe is being led by attorney David Anders. Sanberg has reportedly provided information to investigators, which Anders stated has helped develop a more complete understanding of key events.
Potential consequences for cap circumvention can be severe, with the 2000 Minnesota Timberwolves case serving as a significant precedent, which resulted in the team forfeiting draft picks and facing fines. For the Clippers, who are rebuilding after an era that did not meet expectations, losing draft picks or facing roster construction restrictions could be particularly damaging.
Leonard joined the Clippers in 2019 after leading the Raptors to their first NBA championship. The pairing with Paul George was intended to establish the Clippers as a Western Conference power, but injuries and instability marked their tenure. Now, even Leonard's departure is complicated by the ongoing investigation.
The proposed trade would have sent Leonard back to Toronto in exchange for Brandon Ingram, Gradey Dick, multiple first-round picks, a pick swap, and second-round compensation. However, the deal remains frozen as all parties await the NBA's findings. The Clippers expect the trade to be finalized upon the investigation's conclusion, and the Raptors still express a desire to acquire Leonard, but the NBA has not yet announced its verdict.
This situation leaves Leonard's time with the Clippers officially over but not yet formally closed, with the resolution of the Aspiration saga pending the league's final ruling.