Ballmer's Secret I.O.U., Aspiration's "Web of Lies" and the Zenith of Fraud: Kawhi-Gate, Part XI

Summary

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Pablo Torre Finds Out – "Ballmer's Secret I.O.U., Aspiration's 'Web of Lies,' and the Zenith of Fraud: Kawhi-Gate, Part XI"

Date: June 5, 2026
Host: Pablo Torre | Guests: David Sampson (former MLB exec/analyst), Lou Manzo (former DOJ prosecutor and series legal analyst)
Producer: The Athletic Podcast Network

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Episode Overview

This incisive "talkumentary" installment marks Part XI of the long-running Aspiration/Kawhi-Gate saga. Pablo Torre leads a detail-heavy, Pulitzer-winning investigation into the overlapping worlds of sports finance, white-collar crime, NBA salary cap circumvention, and two giants: Clippers owner Steve Ballmer and fallen fintech founder Joe Sandberg. Special attention centers on the revelation of a long-secret investment "put right"—an IOU from Sandberg to Ballmer—previously undisclosed, and its implications for both the ongoing NBA and SEC investigations. Legal and journalistic scrutiny dissects the consequences of the whistleblowers, investor losses (from orphans to celebrities), and the prospect of unprecedented league discipline.

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Key Discussion Points & Insights

1. Immediate Fallout: Sandberg’s Sentencing (13:00–19:00)

• Sandberg receives 14 years in federal prison for defrauding investors of $248 million, surpassing the sentences in the Theranos (Elizabeth Holmes, 10 years) and Frank (Charlie Javice, 7 years) cases.
• Judge Wilson calls the fraud “the zenith” of white-collar crime:

  • "He started with altruistic intentions, but he became entangled in a web of lies that continued for four years. I would put the grade of this fraud at the zenith." — Judge Wilson, quoted by Sampson (16:29)

• Victim impact statements were crucial: Small-time investors, widows, and orphans (one mother on the poverty line, “excellent at public relations, but he really does not care about people,” 19:00) enhanced the severity of the sentence. Ballmer’s losses were noted, but the suffering of “real people” drove the big number.

2. Explaining the Schemes: SPACs, Round-Tripping, and the Secret Kawhi Deal (20:39–25:51)

• SPAC strategy: Aspiration tried to ride the SPAC (“special purpose acquisition company”) wave during the pandemic era to go public while hiding shoddy finances with "round-tripping" (recycling money through shell entities to artificially boost revenue).
• Kawhi Leonard’s no-show endorsement deal: Secret $28 million marketing contract plus a $20 million put right—effectively a riskless equity grant, all unannounced.

  • "You get a floor... and that floor is negotiated in the contract." — Lou Manzo (25:51)

• The put right fundamentally de-risked Kawhi’s payment, making it unlike a typical player deal.

3. The Core Bombshell: Ballmer’s Secret IOU/Put Right (39:46–43:17)

• First-ever public revelation: Ballmer and Sandberg had a hidden "put right" agreement for Ballmer’s $50 million investment—a side deal guaranteeing Ballmer could demand his money back, making his “investment” a disguised risk-free loan.

  • "Sandberg personally guaranteed Mr. Ballmer's $50 million investment by granting Mr. Ballmer a put right for the value of his investment." — Ballmer's victim letter, read by Sampson (39:46)

• This deal was never disclosed in any SEC filings, Aspiration press releases, or even to other investors.

4. Ballmer’s Changing Story & Credibility Gap (29:53–37:35)

• Ballmer’s public stance: Framed himself as duped, barely acquainted with Sandberg; called Sandberg’s use of his investment “insidious.”
• Contradictory evidence: Multiple private emails and business exchanges, including Ballmer personally helping pitch other investors and coordinating games, suggest a closer, more participatory relationship.

  • "It's hard not to watch that clip and wonder... I would not be a part of a presser where I'm sitting next to someone... and I have not done one ounce of my own due diligence." — Sampson (35:40)

• Ballmer’s victim narrative, while half-true (he lost money), is undercut by this preferential treatment (the secret IOU put right).

5. Securities Law, Disclosure, and the Put Right (46:41–54:50)

• Expert analysis (Pierce Hahn, securities attorney):
  • Not disclosing the Ballmer put right in SEC filings is “fairly serious” and “pretty egregious.”

  • "Omitting material facts is... really fraudulent against the public market for the next investor to buy in..." — Pierce Hahn (47:44, 48:30, 52:47)

• The S-4, a key document for Aspiration’s planned public offering, contains no mention of the put right—a likely violation.
• Legal consequences are most acute for Sandberg/Aspiration (who certified the filings), but Ballmer’s public statements (“As fighting climate change continues...”) and participation further muddy legal waters.

6. Implications for Ongoing NBA & SEC Investigations (54:50–62:17)

• Current status: The secret Ballmer IOU has been reported to the SEC; the NBA’s independent investigators (Wachtell, Lipton) likely know and may have used the info to nudge Ballmer into disclosure.

• "You generally want to take the sting out. So you say this isn't news. I've disclosed this." — Lou Manzo (60:19)

• Litigation heat: The new revelation will likely help the investors suing Ballmer for non-disclosure; legal exposure may increase.

7. Final Assessment: Was the Salary Cap Circumvented? (64:25–65:45)

• Pablo’s question: With all the evidence amassed (whistleblower complaints, the Kawhi contract, 3,000+ docs, multiple sources), is there a rational alternative explanation for Ballmer’s conduct except salary cap circumvention?
• Lou Manzo: > "No." (65:29)
  • Circumstantial evidence is overwhelming, with no innocent rationale available.

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Notable Quotes & Memorable Moments

• On Prejudice Claims:

  • "What that would mean is that the judge was watching the show and had some sort of epiphany... because of our show. And I'm sorry... I do not believe we would sway the judge." — David Sampson (06:24)

• On Conflicts of Victimhood:

  • "Both Sandberg and Ballmer and me, incidentally, all Harvard guys, and they're ganging up on, you know, the journalists, both the alleged scammer and his alleged biggest victim." — Pablo Torre (08:48)

• On Ballmer’s Put Right:

  • "Mr. Ballmer invested approximately $50 million... Sandberg personally guaranteed Mr. Ballmer’s $50 million investment by granting Mr. Ballmer a put right for the value of his investment." — Sampson reading Ballmer’s victim letter (39:46)

• On Legal & Ethical Duties:

  • "If he's going out advertising on behalf of the company... without disclosing that his $50 million investment is guaranteed, that's misleading and that's omitting a material fact." — Pierce Hahn (54:00)

• On the Investigations:

  • "You can't have it both ways. Either this put right was a material representation that was not disclosed, or... material for salary cap circumvention. To me it is very binary..." — David Sampson (57:27)

• On NBA Evidence Standards:

  • "NBA salary cap violations may be proven by direct or circumstantial evidence... including... evidence that a player contract... cannot rationally be explained." — Pablo Torre (64:25)

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Important Timestamps

• Sandberg Sentencing Recap: 13:00–19:00
• Comparisons with Holmes/Javice: 14:40–16:29
• "Zenith of Fraud" (Judge's Ruling): 16:29–17:04
• Victim Impact Evidence: 18:29–20:18
• SPACs & Round-tripping Explained: 20:39–22:42
• Kawhi’s Secret Deal: 23:22–28:30
• Ballmer’s Involvement & Emails: 29:32–34:09
• Ballmer’s Secret IOU/Put Right: 39:46–43:17
• Legal Expert (Pierce Hahn) on Disclosure: 46:41–54:50
• Whistleblowers, SEC, Lawsuit Fallout: 54:50–62:17
• Final “No Innocent Explanation” Conclusion: 65:29–65:45
• Adam Silver NBA Investigation Statement: 66:39–69:11

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Tone & Style

• Tone: Wry, analytical, relentless in journalistic fact-finding, candidly skeptical toward PR spin and legal obfuscation.
• Style: Conversational, interspersed with hard evidence (emails, court filings), with flourishes of humor and throwaway asides about their own reporting journey.

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For Listeners Who Haven’t Tuned In

• This episode is a masterclass in investigative audio journalism, blending sports, legal intrigue, and financial complexity without losing touch with the human (and sometimes absurd) side.
• You’ll leave understanding not just the salacious headlines about a billionaire’s secret IOU, but how the sausage is made in white-collar crime—and what happens when sports, money, and ego get mixed in the dark.
• The evidence amassed makes the case that Ballmer’s claim to victim status is complicated by his unique, secret dealmaking, potentially exposing him to further legal scrutiny as the NBA (and perhaps the SEC) moves toward judgment.
• The show closes on a devastatingly simple conclusion from the lead prosecutor: No rational explanation exists beyond salary cap circumvention.

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Listen if you want to understand how a hidden IOU can shake the credibility of one of America’s richest sports owners, why white-collar prosecution is so daunting, and how a podcast can upend the narratives of both billionaires and con men—at the zenith of modern sports scandal.

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Transcript

[Pablo Torre]

What's up, y'? All? Summer's got a different tempo.

[David Sampson]

Everything's a little looser, brighter.

[Pablo Torre]

One plan turns into another. You hear something, you stay a little longer. Next thing you know, you're somewhere you didn't plan to be. It's those in between moments. That's where the ideas hit. Conversations stretch out. Little memories sneak up on you.

[David Sampson]

Sometimes it's just about what's in your hand. That color, that chill. The new Tropical Butterfly Refresher from Starbucks. Guava and passion fruit flavors with mango pineapple flavored pearl.

[Pablo Torre]

Yeah, that feels like summer before you even taste it. Funny how one small stop becomes the

[David Sampson]

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[Pablo Torre]

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[Pablo Torre]

Welcome to Pablo Torre Finds out. I am Pablo Torre, and today we're going to find out what this sound is.

[Pierce Hahn]

You could go to the SEC and say you didn't, you know, sorry, we disclosed it, but we didn't disclose enough. That's a more common issue, right, where you don't disclose enough. But the fact that there's no disclosure at all is pretty egregious.

[Pablo Torre]

Right after this ad, David is spitzing

[David Sampson]

big time Europe hotels, baby.

[Pablo Torre]

David, I want to thank you for doing this, given that you're beaming in from Germany for this emergency episode.

[David Sampson]

It is a time of day that no one should be speaking as loudly as I'm speaking in a hotel room.

[Pablo Torre]

Part 11 of our aspiration series demands this L. Manzo. We are joined again by him here in New York City. David, this is of course a longtime PTFO listener turned new special legal analyst who is subbing in for Amin El Hassan, who is in a foreign territory known as San Antonio for the NBA Finals. And what Lou lacks in, I would say, a credible Doc Rivers impression, he makes up for and literally being the former Department of Justice prosecutor who launched the federal government's investigation into Aspiration, co founder Joe Sandberg back in 23. Right. So I should recap here for everybody. David, Lou was not one of my sources when we started this series in September of 25. He was merely listening. We finally got in touch for the very first time earlier this year on the dating app known as LinkedIn, which has become, I would say, decreasingly helpful for my reporting now that people know that I'm creeping around there.

[Lou Manzo]

You know, I always like it when you click on my profile. I check it out.

[Pablo Torre]

We are watching each other. But the thing I immediately discovered, David, that I learned about Lou, that's relevant here is that the whistleblower complaint that you and I and Amin read aloud from Sloan live as you sat in the chair that Adam Silver sat in in spring of 26, this was something that Lou had read in, yes, 2023 in the spring of that year, meaning he had also already considered, vetted the witnesses inside of Aspiration who had specifically mentioned in writing under penalty of perjury, that Aspiration had found a way to

[David Sampson]

David, pay Clippers forward Kawhi Leonard an incentivized bonus to circumvent the NBA's salary cap, disguised as an organic marketing sponsorship agreement.

[Pablo Torre]

And this whistleblower complaint, the very same one, would provide Lou and the DOJ a road map for the successful prosecution ultimately of Joe Sandberg. And what else can we say about this, Lou, before you caveat us into.

[Lou Manzo]

Well, I should caveat it and say again, I'm speaking without any personal knowledge of what's happened in the last couple years. I don't have a source inside doj. I'm not going to pretend I do. And I can't talk about what I did at doj, but I can talk about kind of the tea leaf reading of what's happened in the last week and hopefully walk us through his sentencing.

[Pablo Torre]

David, not everybody is happy that Lou is here. This is why Lou is saying this in part.

[David Sampson]

It's amazing, Pablo. You bring in a guy who starts off sort of hands up, can't talk, does a great episode, very important, and he's back. I had it 4 to 1 that we'd never see Lou's face again.

[Pablo Torre]

Well, unfortunately for certain defense attorneys who may or may not have placed a court filing into the public record last week, Lou is back. And I would like you, David, to now read one reaction from Joe Sandberg's attorneys to the aforementioned episode that we did together.

[David Sampson]

Equally stunning and prejudicial is that a former DOJ prosecutor who was involved in this case appeared on a popular podcast on May 5th to offer commentary about sentencing in this case while it is still pending.

[Pablo Torre]

And my favorite part is that after that, they put in parentheses C HTTPs://www.pablo.showp/ the DOJ's aspiration prosecutor joins, which is, of course a newsletter that you can subscribe to. I appreciate everybody digging through court filings to actually get a way to subscribe. I also want to thank Lou for having the balls to come back.

[Lou Manzo]

Well, you know, I think it's important that people take their legal responsibilities seriously, but also speak out about issues, especially things that are going on at doj.

[David Sampson]

I was just struck by the entire sentence, Lou, because I'm trying to figure out, having gone through that episode again, because I was there, exactly how it's prejudicial, because what that would mean is that the judge was watching the show and had some sort of epiphany race sentencing because of our show. And I'm sorry, but I found that as much as I respect all three of us, not in a particular order, but you'd be first, that I do not believe we would sway the judge in sentencing. But, but maybe I'm wrong.

[Lou Manzo]

I also didn't think it was prejudicial to him. I mean, we.

[Pablo Torre]

I agree.

[Lou Manzo]

Yeah. But, you know, it's a defense attorney. I appreciate it. If, if I were the defense attorney, I would do the same thing and throw everything against the wall and try and allege some misconduct against a former DOJ employee and try and, you know, pin it on doj. Why not? But you'll notice in that, in that line, they didn't explain how it could be prejudicial, just that it was generally prejudicial without anything other than the conclusory statement.

[Pablo Torre]

And now that sentencing that was allegedly prejudiced is complete as of Monday, and we'll get to that in a second from inside of the courtroom in Los Angeles. But I also need to point out that we here at Pablo Torre finds out we're not merely condemned by Joe Sandberg's high powered defense attorneys. We were also condemned by Clippers owner Steve Ballmer and his high powered attorneys. Of course. Lou, if you could read this excerpt from the victim impact letter that Ballmer personally tweeted out in April.

[Lou Manzo]

Mr. Ballmer's connection to Sandberg is what caused a former talking head and television personality, Pablo Torre, to launch a relentless vitriolic public campaign against Mr. Ballmer alleging, principally based on anonymized gossip as well as on a misapprehension or intentional disregard of the facts, that Mr. Ballmer conspired with Sandberg in aspiration to engage in the circumvention of the NBA salary cap by virtue of an endorsement deal between aspiration and one of the team's star players, Kawhi Leonard.

[David Sampson]

So beautiful, Pablo. Because if you read these two quotes side by side, it is virtually impossible even for a Harvard guy to walk the tightrope where you do a show where both sides say you screwed them. And it just is a chef's kiss to journalism that you could do a show that both sides believe put them in a position where they had to fight back.

[Pablo Torre]

I should say that both Sandberg and Ballmer and me, incidentally, all Harvard guys, and they're ganging up on, you know, the journalists, both the alleged scammer and his alleged biggest victim, which, to David's point, does feel like an award we should be honoring in some regard as we move forward here. But this shared dynamic between Ballmer and Sandberg may, in fact, say something quite poetic, even interesting, about their relationship, however unintentionally. Because one thing that I do want to tell you guys is that the reason you're both here is not merely to recap the sentencing. It's also to help me understand a side deal that both men made and managed to keep extraordinarily quiet for five years. Until, of course, this new episode of their favorite podcast. Hello, it's me, Pablo. We have been very interested in what you guys actually like about this show. And so in the show notes, there is a survey. You'll find it magically as a link somewhere down there, and you can tell us what you want, more of what you want, less of what annoys you about me and potentially all of my friends. We will use this to improve the show. Takes like 30 seconds, so please fill it out and we will make this better. Allegedly. You know what's become weirdly sacred to me lately? My morning walk around New York City. Before I look at my phone, before my social media is blowing up. I try to get outside, try to get some sunlight, clear my head, and kind of feel like a functioning human being to start the day. And honestly, once summer travel starts, keeping any routine alive gets a lot harder. Which is why I've been appreciating Cachava's new travel packs. It's my favorite all in one nutrition shake. Now, packed to go. I can literally toss a couple packs in my backpack and know I've got something easy and filling and actually good for me wherever I end up. Each packet has plant based protein, fiber, vitamins and minerals, greens, probiotics, electrolytes and omegas. Basically all the nutrition your body craves in one deliciously simple shake pack to go and I have genuinely noticed steadier energy throughout the day as well as better digestion and fewer of those I forgot to eat something real travel moments. Plus it actually tastes good. I personally am a strawberry guy. But they've also got chocolate, vanilla, chai, matcha, coconut, acai and no artificial flavors, no fillers, no nonsense, just clean nutrition that travels well. Try Cachava risk free with their love it guaranteed. So take your daily ritual with you. Go to kachava.com and use code PTFO for 15% off your first order. That's Kachava K-A C-H-A-V A.com with code PTFO

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[David Sampson]

a New York Times subscription.

[Pablo Torre]

We exchange articles and so having read the same article we can discuss. She sent me a year long subscription so I have access to all the games. The New York Times contributes to our quality time together. It enriches our relationship. It was such a cool and thoughtful gift.

[David Sampson]

We're reading the same stuff, we're making the same food.

[Pablo Torre]

We're on the same page. Learn more about giving a New York Times subscription as a [e-mail] gift. I do want to set the scene here because something we've been anticipating for now years actually happened at the federal courthouse in downtown Los Angeles on Monday. And our court reporter Anita Bennett was there filing dispatches for us, watching Joe Sandberg enter the room in off white jeans and a blue sweater over a striped baby blue shirt and sneakers. And at long last, Lou, the case that you started back in the spring of 2023 culminated with a federal prison sentence as pronounced by Judge Stephen V. Wilson of how long in the end?

[Lou Manzo]

14 years.

[Pablo Torre]

Aspiration founder Joseph Sandberg has been sentenced to 14 years in prison for defrauding investors of $248 million per Baxter. And he and the Clippers are being investigated by the NDA for paying Kawhi under the table. Nothing to see here the 14 years after. Again, this case was your baby at the doj. How did it feel seeing that substantial

[Lou Manzo]

a number white collar sentencing is difficult because there's a lot of variance. But I think you can compare it to a couple of the major fraud cases that have been in popular media lately. Elizabeth holmes, she got 10 years for Theranos, which was a major fraud. Institutional investors, kind of similar things were, you know, doctored financial documents, doctored presentations, that kind of thing led to huge investments, ultimate financial collapse. And that was a health product.

[Pablo Torre]

Yes, right. This is blood testing technology that she defrauded investors about because it was not.

[Lou Manzo]

And she went to trial and she was convicted. And so huge expense of resources both to the court and to the government and whatnot. And she got 10 years. And then you've got Charlie Javits in New York. That was the Frank case where she sold her business to J.P. morgan. It was all fraud. She went to trial, got convicted again, huge expenditure of resources, seven years. And this guy pled guilty pretty promptly in the course of the investigation. And he got 14 years for something that didn't involve involve health, but it did involve five years of fraudulent documents. And I think that's probably what got the the court's attention the most.

[David Sampson]

What shocked me, Lou, is that the bid in the ask here was 17 and a half and zero.

[Lou Manzo]

Yeah, that's a huge delta.

[David Sampson]

That is a huge delta. And where he came down was clearly on the side of the DOJ.

[Pablo Torre]

Well, I want to clarify that. The DOJ recommended, yes, the sentence of 17 and a half years based on total losses in their accounting of $248 million. A wide ranging scheme to defraud multiple lenders and investors over that five year period. And Judge Wilson. David, he did say this. According to our court reporter, the history

[David Sampson]

of this defendant is that he is charitable, wants to do good things, wants to do things that he thinks are important. But the circumstances are among the worst that I've ever encountered in my 40 years serving here. He started with altruistic intentions, but he became entangled in a web of lies that continued for four years. I would put the grade of this fraud at the zenith

[Pablo Torre]

so high, it's literally the highest.

[David Sampson]

I've never seen language like the highest

[Pablo Torre]

possible point, the zenith, I believe.

[David Sampson]

I don't know what happens going forward for this judge, because if this is the zenith, definitionally, no one will get 14 years in his courtroom again.

[Pablo Torre]

Yeah, Lou, what Sandberg told the judge on Monday in part was, quote, I lost my moral compass, end quote. And he and his lead defense attorney, Mark McCasey, former Trump attorney, declined comment after the sentence came down.

[Lou Manzo]

In my mind, maybe he was hoping for a 7 or an 8. 14 definitely sticks out. But again, when you're going to jail for that long a time, the difference between a 7 and a 14 might not really hit you until you've been in for a couple years.

[Pablo Torre]

Well, it may not hit you till you leave the courtroom.

[Lou Manzo]

Yeah.

[Pablo Torre]

Because we also have this exclusive video B roll of Sandberg outside the courthouse. David, could you describe what we're seeing here?

[David Sampson]

I'm seeing someone basically gesticulating as though they cannot believe what happened, holding a file saying, did this just happen? Am I really 14 years? I can't read the lips exactly, but it looks as though he's less than happy. And the judge did not grant his request to report after the Jewish holidays, which was one little tiny. He wanted to take care of his sick mother and be with her for the Jewish holidays in September, October. And no, he's got a report in August.

[Pablo Torre]

Right. And so I do want to describe here, by the way, just some of the human costs that sort of account for. Why was 14 years? Because Sandberg presented this attempted portrait of a sympathetic figure, a good guy with a good heart. But there are also these victims that show up in the DOJ's memo as well as in the courtroom, people that Sandberg conned through his relationships and sponsorships and celebrity investors. And one of them who showed up in person in court was a woman who invested in September of 2021, quote, $5,000 in aspiration. And I was a mother on the poverty line. What I see for Joe is that he's excellent at public relations, but he really does not care about people, end quote. And then in the DOJ's memo filed before the hearing, there was the 80 year old widow who paid Sandberg half a million dollars in July of 24. There's the single mother who gave Sandberg another half a million dollars in August of 24. There is the military widow whose husband died by suicide in Iraq, who lost a hundred thousand do. This was some of the roster that helped sway the math towards the bigger end of that spectrum.

[David Sampson]

David, what we call them in law school, it's I'm sorry to tell you, widows and orphans. The more widows and orphans you can get to be defrauded, the better chance you have of getting the bigger sentence. Because it is a terrible story to tell. Steve Ballmer losing $60 million and is not even remotely close to a widow losing 100,000 or 10,000 or an orphan losing 5,000. So you're looking for the most people you can find to come provide victim impact statements and actually show up to the hearing if you're the doj, because it's more meaningful.

[Lou Manzo]

And I think that's what separated this from Elizabeth Holmes and Charlie Javits is that it's not just, you know, UBS or JP Morgan or Sequoia, but individuals with investments as small as $5,000, which is pretty shocking. If you are trying to raise money for a, you know, $100 million, $200 million business and you're taking in $5,000 investments, that. That's unusual.

[Pablo Torre]

Well, this was part of the story was that Joe Sandberg was trying to take this company public via spac. And this is the pandemic era. Right. So it's esg, meaning it's the, we're the good guys. We do environmental stuff during this era in which going public via spac, meaning you would inhabit this vehicle that would be a public offering a stock to buy in the public markets. The whole premise was how can we generate as much revenue to justify the biggest possible valuation? Right?

[Lou Manzo]

Yeah. And this was a weird time in America where using a SPAC to go public, as opposed to an IPO was a different format or in different standards of due diligence where you could get away with, with information in a SPAC that was, was less investigated and go faster. So that's what a lot of companies were doing and that's what aspiration was trying to do. And aspiration also didn't want to think of itself as a bank. Right. It was as a tech company. And so how does tech work? It depends on revenue, not profits. That's how you know you're going to get a huge valuation and to make your stock go, you know, boom when it comes out. Driving revenue was the name of the game. And that's where we got into some of the round tripping at sentencing.

[David Sampson]

To put it in, in even more plain English, it's the way people got rich without any of the regulation that exists when you are doing an ipo.

[Pablo Torre]

Right.

[David Sampson]

And then it, by the way, if you look today, it's basically falling apart.

[Pablo Torre]

So the special purpose acquisition company, the spac. Yeah. This is now a trend that's fallen by the wayside because it largely wound up being, I would say, embarrassingly messy as a concept in a public market. And the round tripping, by the way, I do want to explain that because this is a recurring theme in the story of how Joe Sandberg built up those revenues. Again, revenue, David, different from profit. Revenue meaning simply the money you take in, not the net that you end up keeping, but the round tripping Here, Lou, how do you describe that in terms of how he was operating?

[Lou Manzo]

Right. So if I have a dollar and I give it to you and then you give the dollar to David and then David gives it back to me, I guess I could say I generated $1 in revenue, but nothing really changed. I gave a dollar and it just moved around the circle. But for tech companies, revenue is the big promise that you'll generate revenue and someday, five years down the road, 10 years down the road, that'll somehow turn into profit. That's the model that they've gone on since, since the, you know, dot com boom. What aspiration was doing here and Joe Sandberg was doing was aspiration would pay Joe Sandberg, Joe Sandberg would pay intermediaries, intermediaries would then pay aspiration. And so that's the round trip.

[Pablo Torre]

And this whole thing where Joe would generate business that ended up actually being business that he was effectively funding that was getting paid back to him. I do just want to reference that in the DOJ memo. One of the things they point out is that what Sandberg would be doing individually through his own vehicles is paying for sham services presented as marketing and branding services, often which then paid aspiration, then aspiration, when they went public via spac, would say, look at all the revenue we're getting. And then on the back end at that multiple Joe would profit, aspiration would profit, and that whole manufacturing of business would end up paying off. And the reason I say that is of course, because when we zoom out to what we have been talking about, when it comes to. Wait a minute. Steve Ballmer has been paying aspiration, and aspiration has been paying Steve Ballmer. And Joe Sandberg has been involved in this story as well. It reminds me that I should clarify that neither Steve Ballmer nor the Clippers were mentioned at this hearing in any capacity. But this now underscores, David, this conspicuous reality here, right, which is that Joe Sandberg is going out of his way to create revenue in all of these tortured and manufactured ways. But in this corner of the universe, in the sports, NBA context, he is also paying Kawhi Leonard millions of dollars to do nothing. And Kawhi Leonard, for those who have not been keeping up, not only got signed to a no show $28 million endorsement deal that was kept secret, he also happened to receive a special put right option on $20 million worth of aspiration equity that Joe Sandberg personally awarded him. And just so I can clarify, David, a put right option means what, in

[David Sampson]

layman's terms, when you get an option, put right option, it means that you have the opportunity to cash in something that you have taken into your possession. You can take it into possession and then literally think of the word, you can put it back. I'm putting it back. I'm giving it back to you. Give me back money. And so Kawhi had the opportunity to say, hey, I don't want the shares, I'll take the money.

[Pablo Torre]

Yeah, Lou, the way I've thought about this after consulting various securities experts is this is de. Risking an investment, which is a hell of a benefit to negotiate off to the side, right.

[Lou Manzo]

You get a floor, and that's, that's the benefit of this, that it doesn't go to zero, it goes to a floor. And that floor is, you know, negotiated in the contract.

[David Sampson]

But it's only as good as the credit of the person who gives the put right. So if you get a put and you put stock back and the stock is meaningless, and also the person you are putting the stock back to doesn't have three nickels to rub together to make a dime, then what's the use of the put so it doesn't eliminate all risk ever. Ideally, you'd want that to be backed by a large company, a company that you feel could never go belly up, a company that will always have the ability to call back and take the stock back. And that certainly was not the case with aspiration.

[Pablo Torre]

Yeah. All of which is to say that a put, if real, substantially changes the whole thesis and the risk profile of what this investment really is. So something that I need to clarify here, David, is actually the next thing I need you to help me. TABLE Read here because how Joe Sandberg, again guy, now convicted in Federal Court to 14 years in federal prison, how he described this payment in another private email that we obtained that was sent to members of Aspirations C Suite, does help clarify sort of the scheme he was running when it came to the basketball stuff.

[David Sampson]

For avoidance of doubt, any and all benefit to aspiration from the Kawhi deal is being subsidized by my contributing my equity to make this happen in conjunction with my offering to do that. I also explained verbally that Kawhi's team wanted his legal fees paid. I'll state it here for you. I am transferring 20 million of stock to Kawhi over four years to enable this partnership for aspiration. The benefits that you will get from this partnership are subsidized by my 20 million of stock. Regards, Joe and Lou.

[Pablo Torre]

The phrase there that has always stuck out to me is the benefits of that you will get from this partnership because it raises the question of like, so what do you have to gain by having Kawhi Leonard secretly paid?

[Lou Manzo]

Nothing here makes sense, right? That you're going to have somebody who is. Is very much not a dynamic speaker. He's a great basketball player, but not a dynamic speaker and who has no social media presence and doesn't want to talk about anything but play basketball. Not sure why he would be a great sponsor. And then there's no reason why he'd be a great sponsor if you're not going to tell anyone that he's even a sponsor.

[Pablo Torre]

Let's just let that hang in the air a bit as we point out that Kawhi's reps, Kawhi Aspiration, Joe Sandberg and Steve Ballmer never announced this. The original sin was that this was never announced, as Lou alluded to, as Steve Ballmer continued to pour money into aspiration. This was personally and via the Clippers, while Kawhi, yes, was getting paid by aspiration secretly. So before we get deeper into Steve Ballmer's Clippers allegedly having a secret side deal with Joe Sandberg to circumvent the salary cap for Kawhi Leonard. I should also note that there does remain an active lawsuit from 11 aspiration investors who are suing Ballmer right now in civil court in Los Angeles. And what they allege is that Ballmer has a secret side deal with Joe Sandberg that would have radically changed their decision to follow in the footsteps of one of the richest investors and in the world by entrusting their money as well to Aspiration. And Lou, what they write in part is the following.

[Lou Manzo]

Plaintiffs would not have invested and or kept their investment in Aspiration if Ballmer and Sandberg had disclosed the true nature of Ballmer's investment.

[Pablo Torre]

But Ballmer's lawyers, David, what they say in the victim impact letter that they filed on behalf of their client about Joe Sandberg is this.

[David Sampson]

Mr. Ballmer now understands that without his knowledge and contrary to the truth, Sandberg was touting a close relationship with Mr. Ballmer to other investors and using Mr. Ballmer's investments to attract additional similar investors. This is particularly insidious given that other than greeting Sandberg at a Clippers game, they had barely spoken. Indeed, Mr. Ballmer recalls speaking to Sandberg only once, and that was only briefly while they both attended a public event.

[Pablo Torre]

We have Zenith, we have Insidious, we have really the heights of the emotional spectrum. And one thing I need Lou to read here is a private email that I've obtained written by Joe Sandberg. This from the month after Steve Ballmer negotiated his highly publicized $50 million investment. And this email was addressed to Ballmer's chief investment officer and right hand money man Brandt Vaughn, whose subject line is quote, request for a reference, end quote.

[Lou Manzo]

Brandt, I hope you're doing well. Will you be in LA for the Clippers opening night on October 23rd? I hope that will be the first of many games where you and I will get to cheer together. I'm also hoping you'd agree to act as a reference with a potential aspiration investor who is considering purchasing the same security that Team Ballmer purchased. The investor has recently asked to speak with you. Would you be willing to speak with the investor about your perspective on aspiration?

[Pablo Torre]

Best Joe to which Brandt Vaughn, Team Ballmer's top money man David, says, hi

[David Sampson]

Joe, all good here. I unfortunately have a conflict on the 23rd, so we'll miss the game. I'm glad to speak with the investor. Feel free to connect us. Thanks, Brandt.

[Pablo Torre]

That was From October of 2021, that exchange, as was this email from Joe Sandberg to Aspiration executives. Lou that begins with a reference to Clipper's President of Business Operations, Gillian Zucker, who works directly with Steve Ballmer.

[Lou Manzo]

Gillian is enthusiastic to support our success and please count her as an ally who is willing to help us as often as we would like her to help us. She is eager to contribute to our success. Please keep that front of mind. Also, Ballmer himself is enthusiastic to help and will personally be a reference and advocate where we ask him. So please keep that front of mind also.

[Pablo Torre]

And at this point, David, I just want to clarify, we've just had Lou Reed, an email from Joe Sandberg, noted fraudster, who is describing all of the ways in which Steve Ballmer and his associates would love to help Aspiration enthusiastically. And maybe that's all a lie at this point in the story, that seems possible and something we should acknowledge.

[David Sampson]

The reason why I am not going to acknowledge that is that while he is a convicted fraudster, what we've seen already with the email exchanges is not a one way made up relationship. Which as a former person in sales on Wall Street, I totally understand how you could spin that yarn. But the way we would spin it would not include emails that had this level of connection with the people we're talking about. It would always have a degree of separation.

[Pablo Torre]

And this is where David's refusal to play along with me does vindicate him. Because the next thing I was going to ask him to read is another private email sent just three days after that one. This one written by Steve Ballmer himself. It was sent to Joe Sandberg and the CEO of Intuit as well.

[David Sampson]

Since Intuit and Aspiration already have a business relationship and all of us share a passion for the clips and our Intuit Dome project, I thought it might be fun for the four of us to take in a game together sometime soon. Would love for us to all get to know one another better. Here are a few dates that work on my end. Hoping one of these might work. If not, feel free to suggest a few others. Or we can let the experts find the perfect time. Could December 8th against Boston or January 11th against Denver possibly work?

[Pablo Torre]

All of which is to say that what Steve Ballmer's lawyers said in April of 2026 about how Ballmer now understands that without his knowledge, sandberg was using Mr. Ballmer's investments to attract additional similar investors. Does not quite add up.

[David Sampson]

It's just I'm trying to figure out how a podcaster, a Pulitzer Prize winning podcaster, is putting pieces of a puzzle together. Talking head, a talking Listen. He's graduated. Once you win a Pulitzer, you can no longer be called a talking head.

[Pablo Torre]

The head still talks. The head still talks.

[David Sampson]

It will always talk. I'm just shocked by this and people. I don't want to get too far under the kimono, but I see these things for the first time here and I just, I'm shocked that they would take a position that is so easily refutable by the existence of actual emails, not speculation by a talking head podcaster.

[Pablo Torre]

And so one of the things that Ballmer wants you to think is that Joe Sandberg marketing his investment is insidious. But in fact, over and over again, what we're seeing is that Steve Ballmer himself is personally helping Joe Sandberg use Clippers games in specific to grow his credibility.

[Lou Manzo]

The piece de resistance, as we went through this is when we had a chance to really sit down and meet the folks from Aspiration. Joe Sandberg, who runs Aspirations here, will talk to you a little bit more about their company. We can talk about our partnership, but

[David Sampson]

it's hard not to watch that clip and wonder to myself, is that what it looks like when you are first meeting a partner? And as someone who ran a team for 18 years, I would not be a part of a presser where I'm sitting next to someone and I am putting my name or the name of our owner or our organization with someone. And I have not done one ounce of my own due diligence. It's just, it is not credible to me.

[Lou Manzo]

They're generally making statements that, that may, with your video evidence, be inconsistent with, with reality.

[Pablo Torre]

But the question of reality. Now, it raises a related question which we've been raising, David, ever since we dropped part one of the series, which is that Steve Ballmer has kept characterizing his relationship with Joe Sandberg in that way that Lou just alluded to, inconsistent with reality, such that it seems like Steve Ballmer was, yes, just one of the many other investors that Joe Sandberg scammed, as opposed to the most important VIP investor.

[Lou Manzo]

This is not a fun thing to. To be through. I was personally defrauded, remember? They defrauded me. They defrauded many other investors much bigger than me. These were guys who committed fraud. How would I be able. Look, they conned me.

[Pablo Torre]

You're one of the richest men in America.

[Lou Manzo]

I made an investment in these guys thinking it was on the up and up, and they conned me.

[David Sampson]

But the problem is that all the evidence that surrounds the things that he said, not even in that clip, but as part of the general PR that Ballmer has used, is trying to paint a story of no relationship. And so to me, that's where he loses credibility. And once you lose the credibility, I have to call into question anything he's saying about his relationship with Sandberg and Aspiration.

[Pablo Torre]

The thing that Team Ballmer wants to argue about, if I can summarize it in a nutshell, Lou, is that you podcasters, you may Have a federal whistleblower complaint submitted under penalty of perjury by the two employees who helped take down Aspiration co founder Joe Sandberg. You may even have the signed and executed Kawhi Leonard contract, which was a no show endorsement that never got announced by anybody. You may even have more than these 3,000 pages of documents and nine sources from inside the company corroborating all of your reporting. But what you do not have is Steve Ballmer himself personally disclosing the existence of a secret side deal with Joe Sandberg. And that threshold, just to be very clear about it, that seems pretty high. If you don't have a confession signed by the guy, then what are you really proving here?

[Lou Manzo]

Right. In criminal law, when I was a federal prosecutor, you're always looking for that one email that says, hey, you know, here's the conspiracy. Conspiracy is usually not written out by words. It's circumstantial. So there's gonna be parallel paths and there's gonna be a wink or a nod or just an agreement generally that can just be as short as one second, as long as many years. Very rarely do you have an email that says, I agree to do X with you, and that's illegal.

[Pablo Torre]

Well, the other reason, with all that established that I really was excited to do this show with you both today, is because somewhat remarkably, we do now have Steve Ballmer in writing, thanks to his attorneys, saying, in fact, we did have a side deal with Joe Sandberg and it's not exactly the one you might have thought. David. And so I would just like you to read this excerpt, yet another excerpt from Steve Ballmer's victim impact letter, the one he conspicuously tweeted out for the world under the auspices of being duped. Because this next passage, this seemingly unassuming sentence, is a revelation for people like me who've been so many levels deep in this story. It is a sentence that speaks directly to the true nature of Steve Ballmer's investment.

[David Sampson]

Mr. Ballmer invested approximately $50 million on September 14, 2021, and $10 million on March 9, 2023, in an effort to further entice Mr. Ballmer to invest. Sandberg personally guaranteed Mr. Ballmer's $50 million investment by granting Mr. Put right for the value of his investment.

[Pablo Torre]

The reason this has been a bit of an asteroid into the theater of this story is that the people I've been talking to, this is current and former aspiration employees, current and former aspiration investors. None of them had any idea for five years that this side deal between Joe Sandberg and Steve Ballmer around the precipitating famous investment that was in headlines existed. And so the very notion that Steve Ballmer is admitting a half decade late that he had his own hidden arrangement with Joe, changing an investment of $50 million into a relatively again risk free loan with a personal IOU that de risked the celebrity VIP that came in to boost the reputation of the company. I mean, David, to describe how much this smells, it is hard to find the right analogy.

[David Sampson]

Yeah, this would get through even my Covid nose. Now, we can argue and quibble whether or not there is a duty to disclose this to other investors. It would have to do with what kind of llc, whether it's a C corp, an S corp. There's all sorts of different rules and laws that Luke can talk about if he so chooses. But the reality is that when you are using Ballmer as really the ramp to get other investors into the company by touting this investment. And it's a risk free investment for Ballmer who takes the put right and says, we're not going to tell anyone this, but thank God I've got my money back. Hey, you're not getting that put right. Thanks for your money. It just smells terribly to me.

[Lou Manzo]

It feels like two big things, right? One is he's a different kind of victim, right? Because he had this backstop that other smaller investors, you know, the widows and orphans that came to the DOJ sentencing did not have. So when Ballmer says that he is a victim, true, he is a victim.

[Pablo Torre]

He lost that money.

[Lou Manzo]

He lost the money, it's all gone. But he had a very different deal than everyone else. And the second thing that it makes me wonder about is about any kind of diligence that they must have done into Joe Sandberg, right? Because I can personally give a put right for $60 million, but that doesn't mean anything because I don't have $60 million. So you would think if you're a team bomber that you would do some diligence and some digging into Joe Sandberg at this point to see if that agreement is worth anything or if it's just, you know, a worthless clause that's being inserted.

[Pablo Torre]

Yes. I mean, this is it, right? This is now getting to the nexus between two men, one of whom says very publicly, barely know him, insidious, had no idea he was using me in all these ways. And meanwhile, you have another level to which there was a personal protection, a plan, a negotiation that was meant, David, to safeguard the very reason Ballmer came in apparently in the first place, it

[David Sampson]

doesn't matter the size of the investment, whether Bomber put in 50 million, 5 million, whether he's worth 5 billion or 500 trillion. What a put right option does when it's between two individuals, it tethers them. There's no other way that I can describe it because in order for the put to be worth anything, it has to be substantially passable for it to to have an existing worth. Otherwise what are we doing? So to me this is absolute mind blowing evidence that some could cause circumstantial, but the existence of this put right is very real. That would show that a relationship between Ballmer and Sandberg was not started the Tuesday before.

[Pablo Torre]

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[Pablo Torre]

One of the things I've been doing because I am not a securities expert, I'm not a lawyer, unlike both of you, is that I've been consulting lots of people, whoever I can, to help me learn about this, understand it. And so I consulted two longtime securities lawyers, two preeminent law professors with SEC experience, against two venture capitalists. All of them echoed that the whole thing smells. But one of those securities attorneys referred to me through a Harvard Law School professor, agreed to go on the record to explain exactly why, provided that I could clarify that he was not providing legal advice and that listening to this podcast does not create an attorney client relationship. Which frankly, after dealing with Lou for this long, that felt fair as well.

[Pierce Hahn]

I am Pierce Han. I'm a partner in the ICE Miller Office of Washington, dc. My practice is largely federal securities laws and corporate and M and A matters.

[Pablo Torre]

What I asked Pierce Hahn was how big a deal a publicly undisclosed put right option between a big name investor and the co founder of a company raising money trying to go public via

[Pierce Hahn]

SPAC might be it's potentially fairly serious. It's something that is material to the public or to other investors who may want to invest that there's this side deal going on. The foundational principle with the SEC is it's known as Rule 10B5. It's a anti fraud provision. You're required to provide disclosures. Right. And omitting material facts is the same thing. Right. It's really fraudulent against the public market for the next investor to buy in not knowing that there's a contractual put option. Right. For this big name investor or this big name investor is getting some sort of benefit. And yeah, it's even more egregious that it was guaranteed.

[Pablo Torre]

I'm not an SEC or securities expert. How obvious is this to you? I mean, just the basic facts of this.

[Pierce Hahn]

Well, especially if this is A big name investor that's in this space and $50 million is not a small amount of money. This person, the investor should have known. It's either a reckless disregard for the public or for other investors or there was some understanding between the company and the investor. Like you invest, we're going to advertise and we're going to make this thing bigger.

[Pablo Torre]

And so what Pierce Hahn is really harping on here is that it's crazy that this wasn't disclosed. And so my brain goes to of course, like what would someone perhaps suing Steve Ballmer in civil court over a lack of disclosure around the Kawhi Leonard side deal now think upon realizing, wait a minute, there was another side deal that's already been admitted to.

[David Sampson]

What an interesting decision by Ballmer's lawyers to disclose this in a victim impact statement while also in the middle of a lawsuit with other investors who would have liked to have known this material side agreement existed as it would likely have impacted their own investment. So Steve Ballmer is doing something and we don't know why, though we certainly can speculate as he's sending this impact statement to Judge Wilson prior to sentencing. But the reality is that he's disclosing something that's very hurtful in another litigation that is currently ongoing.

[Lou Manzo]

Yeah, if I were a plaintiff counsel in the civil case, I would be jumping up and down at this one.

[Pablo Torre]

I do want to point out that I've been spending many, many, many hours of my own looking for any evidence of previous disclosure across the 3,000 pages of documents and more that I've gotten and otherwise. And so what I can tell you is that according to one set of emails with Sandberg and potential aspiration investors that he was pitching this of February 2023. There are attached financial documents and an aspiration cap table that mention the Ballmer investment, but they do not disclose the put option. You can see that on the screen here. It also was not anywhere among the list of disclosures in the December 2022 Purchase Agreement for Dennis Wong, Ballmer's longtime friend and the lone Clippers co owner who notoriously became the only new outside investor into aspiration after wiring $1.99 million into the broke company nine days before Aspiration paid Kawhi Leonard his months overdue $1.75 million. And while Team Ballmer said yes, it was insidious that Sandberg was using Mr. Ballmer's investments to attract additional similar investors. That is quote, Ballmer also participated in a big press release about his investment in December 2021, which was also included in the SEC S4 filings for aspirations future Public Offering. The SPAC that we explained earlier and the release names Ballmer in the headline celebrating this big $50 million investment and says nothing about the put right while quoting Ballmer saying Lou, the following.

[Lou Manzo]

As fighting climate change continues to become front and center for more people and businesses, aspirations technology brand and community of members make it one of the most significant new companies in the public markets.

[Pablo Torre]

And that S.E.C. s4 filing for aspirations future public offering. According to Pierce Hahn, the securities lawyer we've been talking to, that does turn out to be the most obvious place where this should have been disclosed.

[Pierce Hahn]

That's really the biggest one, right? Because that's the most public facing, right? I mean you can make the argument that in a short press release, you just have the big name investor, how much he's investing then fine. But the S4 requires comprehensive affiliate and related party disclosures. I mean that's the main public facing document. If you try control effing certain related

[Pablo Torre]

party or affiliate, certain relationships and related party transactions, it should be there. So command effing inside of this section I'm looking for the name of the investor or the name of his LLC and neither come up.

[Pierce Hahn]

That should have been disclosed there. That's the appropriate place. It would have at minimum, right? I mean so some companies will over disclose but I mean at a minimum there should have been one line that there was an arrangement with, with XYZ investor and you know, you could go to the SEC and say you didn't, you know, sorry, we disclosed it but we didn't disclose enough. That's a more common issue, right, where you don't disclose enough. But the fact that there's no disclosure at all is pretty egregious in my view.

[Pablo Torre]

And so just to translate again, what we are reporting here is in fact, yes, Steve Ballmer duped in the end. I am not disputing the loss of the money. What I am saying is that along the way he also had this IOU guarantee with Joe that was hidden from the public, from the market and from future victims of Joe Sandberg, which lands according to the SEC and securities experts I've talked to most problematically upon aspiration and Joe Sandberg specifically the people who authored who are responsible for the SEC filing that was missing this disclosure. And so the question then becomes, but what about Steve Ballmer's personal legal obligations as disclosure is concerned? And that is a bit trickier.

[Pierce Hahn]

It's a little bit more tenuous Right. But if he's going out advertising on behalf of the company, saying, I invested $50 million and you should, too, without disclosing that his $50 million investment is guaranteed, that's misleading and that's omitting a material fact.

[Pablo Torre]

And so that would be adjudicated how

[Pierce Hahn]

an investor later would sue and then it would go through the courts. But at the SEC, when reviewing the S4 itself, when it got filed, and any other related disclosures and filings, because the SEC is constantly looking at, you know, but they don't have the manpower to look at everything. But right. If for whatever reason there was a red flag or, you know, something wasn't adding up, they may be doing their own internal investigation and then they refer to their enforcement division, and then that. That's the one that then prosecutes and brings charges.

[Pablo Torre]

Right, for fraud. We did reach out to Steve Ballmer's attorneys for clarification, their office, and they did not respond. But all of this does bring us to the next thing that I have been looking forward to reporting here today after spending the last three weeks or so talking to that range of current and former Aspiration employees and investors, as well as current and former federal employees. Lou Manzo not among them, incidentally, until now. The thing I've been meaning to report is that Steve Ballmer's put right option, the secret side deal, slash, refund, slash IOU brokered with Joe Sandberg, has now been reported to the securities and Exchange Commission, whose investigation into Sandberg and aspiration is still ongoing. And you may recall that Ballmer was previously interviewed by the SEC. But what is quite notable, if you read the SEC's complaint against Sandberg, this one filed in August of 2025, is that they describe how Investor 1 purchased a $50 million in Aspiration stock after September 2021 because the company looked, quote, incredibly well financially. And they go into detail, David, how

[David Sampson]

Sandberg quote, touted aspirations, successes and profitability in the corporate ESG sector to invest chief Investment Officer in person and over the phone, making materially false and misleading statements to Investor 1 in the process.

[Pablo Torre]

And if you continue to read that section devoted to Investor 1, aka by all description, Steve Ballmer, they don't mention the SEC does not mention that Investor one got a putright option either. Which raises an interesting question, Lou, and I'm wondering if you can guess what the question is.

[Lou Manzo]

Does. Yes, you see? No.

[Pablo Torre]

Bingo. And when, in fact, if they did, when did they learn this? Were they informed when they interviewed Steve Ballmer as the Victim David, who is laughing.

[David Sampson]

I just had a thought that you're going to be mentioned in a third filing because it will be from a talking head, Pulitzer Prize winning podcaster that it came to light that there was this situation.

[Pablo Torre]

I have been very afraid that someone else, including ESPN by the way, which got a leaked version of Ballmer's victim letter, would also draw attention to this put right. But it is left this band of misfits, it turns out to have this

[David Sampson]

discussion once in a while, you have to be reined in because there is a story that can be told that this put right option was not actually meant to materially mislead investors. It was meant as a way to further cover up a salary cap circumvention, which would not be all that interesting to the sec. It is critically important to understand which road Steve Ballmer is going to choose to walk down, because you can't have it both ways. Either this put right was a material representation that was not disclosed, or it was immaterial for SEC purposes, but material for salary cap circumvention. To me it is very binary and I look forward to Steve somehow teaching me why it is something in the middle.

[Pablo Torre]

So the question of why, why would it be that Steve Ballmer disclosed the secret put right option side deal with Joe Sandberg for the first time in a half decade? Team Ballmer would not comment on any of this to us. But it is worth remembering, as we discussed in our last episode, that the NBA's investigators at Wachtel Lipton did file a very interesting letter, David, on behalf of one Mr. Joe Sandberg ahead of sentencing. And that letter did say this.

[David Sampson]

Mr. Sandberg sat with us for two in person interviews, produced documents, and through his counsel provided additional information that was relevant to our investigation. In all our dealings with Mr. Sandberg, both directly and through his counsel, he provided information that was consistent with our review of contemporaneous documents and other evidence. Mr. Sandberg's cooperation substantially assisted our investigation, including our ability to develop a more complete understanding of key events.

[Pablo Torre]

And so I suppose it is possible, Lou, maybe, that Sandberg provided information to Wachtel Lipton, the NBA investigators about the put right side deal. And Wachtel maybe even asked Team Ballmer about it, or at the very least informed them that this was a thing that Joe Sandberg had been talking about, thereby incentivizing Steve Ballmer to get out ahead of any public mention of the put right at sentencing. Perhaps in LA, where Joe got the 14 years, or in a law firm's report to NBA Commissioner Adam Silver that is expected eventually, maybe this summer, in order to claim self protectively that Ballmer himself had already disclosed this. And so this is not in fact some bombshell. I said it myself. But Wachtel's lead investigator did not respond to my request for comment about this.

[Lou Manzo]

I think your theory is the most likely. You generally want to take the sting out. So you say this isn't news. I've disclosed this. It has been known in the public sphere. And so this is a nothing burger. That's the only explanation I can come up with for why this would be in a victim impact statement at this stage of the game. Certainly not something that the judge would really care about. And it's just a gratuitous detail that that doesn't need to be in the letter.

[Pablo Torre]

Well, there is another bit of texture I need to acknowledge from an earlier episode actually, and you may turn your missilet to part 8 of this series published in February of this year when we discuss something David, that is it turns out relevant. Here we discussed a very important and very privileged email chain which described the negotiations, some of them at least on Ballmer's original fifty million dollar investment which he had made through his as always tragic comically named llc, his vehicle Pole Pat not pole Pot Pole Pat and the chain included David, you may recall Joe Sandberg aspirations corporate outside counsel, Ballmer's corporate outside counsel and also his Chief Investment Officer, the aforementioned Brandt Vaughn. Because on September 6, 2021, otherwise known as Labor Day, Ballmer's council included the following note as everyone was trying to speed close this investment into a company with spoiler alert fraudulent financials.

[David Sampson]

Let us know if you have any questions at all. We are also working on a separate put right letter agreement regarding the proposed transfer of a amount of shares to Joe Samberg as well as a related side letter to be entered into between POPAT and Aspiration acknowledging such putright. We'll share drafts of these documents as soon as they are available and that

[Pablo Torre]

which we had never read on the show before is the only documentation, the only evidence of this thing that Ballmer suddenly disclosed in his victim impact letter. But the more insane part I would argue is the fact that in March of 2023 let's not forget this other component to the excerpt that David read from the victim's letter. In March of 23 Steve Ballmer proceeded to invest another $10 million and by then, if you're not familiar, not only had the two aspiration whistleblowers filed their complaint to the government, to the doj, where one Lou Manzo was, was, it turns out, waiting to be eventually invited onto this podcast. In the disclosures that Ballmer signed off on on that investment, he was told in writing that KPMG had resigned as aspirations independent auditor. The company was in default. And the sec, Lou, they put it this way. In that same complaint against Joe Sandberg that we read from earlier on or

[Lou Manzo]

about July 5, 2022, KPMG resigned as aspirations outside auditor, citing, among other factors, revenue transactions that had characteristics of fraud.

[Pablo Torre]

Not, not the best investment, I would say, given that you're going in, David, as you previously reported, as if the company was still gonna go public via SPAC at that over $2 billion valuation. That is the price that Ballmer still bought in at $10 million for nothing

[David Sampson]

about this was normal is my takeaway

[Lou Manzo]

if you get this letter from KPMG that not only, you know, there's different ways auditors can resign. They can resign quietly and walk away, or they can resign and say revenue transactions that had characteristics of fraud. There's no way a company's going public even via SPAC after KPMG says this. And so the idea that this could still be a viable investment is preposterous.

[Pablo Torre]

And so the question I have for Lou Manzo at the end here as the guy who launched the prosecution that has now culminated in a towering 14 year sentence for Joe Sandberg is kind of a simple one. But I do want to read from the thing that David Sampson quoted earlier, which was the NBA's collective bargaining agreement, which says about violations of the NBA salary cap, that they may be proven by direct or circumstantial evidence, including but not limited to evidence that a player contract or any item or provision thereof cannot rationally be explained. And so, Lou, I know the NBA is not federal court, but if we provided a prosecutor with all of the evidence that this series has amassed over 11 episodes. Now, when it comes to whether Steve Ballmer circumvented the NBA salary cap for Kawhi Leonard in a secret side deal with Joe Sandberg and aspiration, do you have an alternate rational explanation?

[Lou Manzo]

No.

[Pablo Torre]

Play the music.

[Lou Manzo]

It's very hard to imagine a scenario where rational actors would take these routes, but for the sake of this outcome, and that would be salary cap circumvention,

[Pablo Torre]

in other words, David, I think there is a one word summary which I'd hope you could provide us at the end here because the answer to my question is therefore guilty. But speaking of verdicts, before I Let you go here. I do need to point out that ahead of Game 1 of the NBA Finals, which of course, the New York Knicks won quite dramatically, NBA commissioner Adam Silver held his traditional annual press conference. And there was a question that I did not know was going to be asked. And I want to credit Joe Varden of the Athletic for completely independently asking it, because this is the exchange that happened between the reporter and the commissioner unedited. I wanted to ask you about aspiration

[David Sampson]

and the investigation there, but I wanted to point out a couple things and have you react.

[Pablo Torre]

The questions are, is the investigation done?

[David Sampson]

When might you release whatever decision you're going to make? But in this process, there's been a

[Pablo Torre]

Pulitzer awarded for the reporting on it. And then Also yesterday, the CEO was

[David Sampson]

sentenced to, like, 14 years in prison.

[Pablo Torre]

Do either of those things, from a perception standpoint affect the decision that you ultimately have to make?

[Lowes Pro Desk Representative]

So, number one, Joe, as you know, the investigation is being conducted by a law firm independent of the NBA. I mean, yes, ultimately we're paying their bills, but they are doing the work independent of the league office. And my instruction to them is, you know, we can't be investigating forever, but at some. And at some point, we have to wrap it up. But at the same time, the most important thing is that we get it right. And I think that relates to the second part of your question in terms of perception. I certainly hear and read things all the time about the perception of what really happened or didn't happen. And my only reaction is I think I wouldn't be doing my job if ultimately I issued a determination based on perception. Like, my job is to follow the facts. And what essentially happens here is that a factual report together with findings will be made by this independent firm that's presented to me. It's then ultimately my role to determine what the appropriate discipline, if any, should be meted out based on their findings. So sort of, you know, two independent processes there, and that's what's happening right now. So I don't have a specific timeline on when they will be completed. I think it's clear they're. They're far along. I think those reports are reading all the time from people who are being interviewed by them. And I think they understand that you could keep going on and on. But I think we're close to the point now where I think we need to wrap this up, because you also need finality. Their team has to understand, you know, what situation they're going to be operating under, and so do the other 29 teams. So that's where things currently stand.

[Pablo Torre]

Pablo torre finds out is produced by walter averoma, maxwell carney, ryan cortez, juan galindo, patrick kim, neely loman, rob mcrae, matt sullivan, claire taylor and chris tominiello studio engineering by rd systems sound design by andrew burcic digital strategy by bailey carlin and andrew northern theme song as always, by john bravo and we'll talk to you next time. ACAST Powers the World's Best Podcasts Here's a show that we recommend.

[Lou Manzo]

A photographer in Texas earns an extra $47,000 a year shooting Star wars cosplay portraits. A teacher in Maryland turns her woodworking hobby into a five figure side income without leaving the classroom. And a couple in Pennsylvania will rent you backyard chickens for the season so you can try the egg laying life without commitment. My name is Chris Gillipow. I'm the host of side Hustle School. I share these kinds of stories every single day in detail, with full transparency about the numbers. The point isn't just to inspire you, it's to show you what's possible. Proof that ordinary people are quietly building extra income in surprising ways, including a few ideas you can borrow less than 10 minutes a day every day. Subscribe or follow side Hustle School wherever you get your podcasts or find us directly at side hustle school.com Acast helps

[Pablo Torre]

creators launch, grow and monetize their podcasts everywhere. Acast.com.