Listen: The Great NBA Heist: How One Man Stole Millions from the Sacramento Kings
"Fans are really familiar with the basketball side of an NBA team. You know the starting five. You probably do the general manager and the coach and then there's this parallel world in NBA Franchises. which is the business operations? Kevin Arnovitz writes about the NBA FOR ESPN NBA. Teams have senior vice president of human human resource and for the Sacramento Kings. That person is Stacey W- exit so August two thousand eighteen wags in his doing human resources stuff off for one. There's this document that executive who just left for the Miami Heat was supposed to leave behind schedule of commissions for sales reps but he forgotten to do so now she needed to dig into some files to find it so she opens up the file directory in it is a mess. She can't find in anything. There's no rhyme or reason dates or names of folders. She does find this one folder titled Turbo Tax. An inside is all kinds of just really weird stuff. There's a depreciation schedule for a golf cart in furniture at some beach house in southern California. None of this looks like anything anything that is Sacramento Kings business. And what's really weird is all of this stuff is associated with an entity. She has never heard of Wigs and looks over all this stuff and she just knows something here isn't right today the untold story of our high ranking. NBA Executive stole thirteen million dollars and almost got away with times. It's Tuesday November nineteenth this is espn presented by Dell small business. So Kevin You published your story today it starts with the Sacramento Kings Chief Revenue Officer. Who is this Guy Jeff? David is the chief Revenue Officer for the Sacramento Kings. And that's just a fancy name for the guy who deals with all the sponsorships right he's in charge of the naming rights to the arena. He's in charge of in arena. Sign Edge The practice facility sponsor and was is really well thought of in this space if you ask a bunch of business side people in the NBA. Hey you're the ten most likely people to become team presidents in the next ten years like Jeff Davids often on that list. What kind of guy was he? He was a California Bro. He was the consummate sales guy he would come into a Monday morning meeting and say let's close some phone numbers today in closing phone numbers. Jeff speak was let's close some seven-figure sponsorship deals was generally well liked as just in a abusive hug. It out kind of guy in the office. So it's an exciting time to be part of the Sacramento Kings. And he does something interesting he. He creates his own company Sacramento sports partners. Why does he do this? So we asked Jeff David what he says is that around around two thousand and eleven there was an NBA lockout and a lot of people. Really panic I mean the thing about a lockout is there's just not any revenue coming in everything's frozen and so I think a a lot of business affairs people in the NBA are just worried. Like what if I have to lose my job. Would I have to go do something else. So the Way Jeff David tells it is I created this thing because look I might need to do some consulting on the side. That's not what he does know. Jeff David starts to do something really interesting. Rather than billing sponsors answers that he gets to by signing edge in the arena through the traditional Sacramento Kings accounting he has them pay Sacramento sports partners. Which looks like if you're getting an invoice at this company that is just bought this linage? It seems perfectly appropriate. Seems like exactly the kind of entity you would pay if you're writing a check to the Sacramento Kings. UNBEKNOWNST to the company it's actually an entity owned by Jeff David that sounds like some subsidiary of the Sacramento Kings. How many retirement he did about three deals totaling a little around thirty thousand dollars to what happens next so it really starts ramping up? Two Thousand Fifteen. Two Thousand Sixteen in the Kings were moving from they're really old arena to this brand new sparkling downtown jewel box. He is the point person for the naming rights both for the Rena and the practice facility in the kings identify really David identifies to sponsors that are relatively local. One is golden one which is a credit union in California and the others. Kaiser Permanente healthcare provider Divider well-known in California kice negotiates a really good deal for both sides. I mean it's it's going to be one hundred ten million dollars over twenty years with golden old in one. They're going to have their name in lights. This is the biggest deal of Jeff. David's career and Kaiser Permanente is going to pay twenty eight million dollars over ten years to have their name on the practice facility ability. Everyone is thrilled is bosses are happy. The sponsors couldn't be happier especially golden one. Is this little credit union. They're gonNA have their name on an NBA arena. It's all really great. And then he gets creative. Has That for whatever reason David decides that he wants them for himself at a certain point. During that negotiation nation there was conversations golden one in the kings that look. If you guys ever need more cash up front were credit union. We can help. We can't keep cash on hand so whether it's finishing the arena or whatever we could possibly service Jeff David file that away and then in two thousand sixteen. After the deals completed he comes to golden one and says hey remember of those conversations. What if we did that would if you sent nine million dollars our way in an exchange will knock off some money off the later payments down in the deal? The old past two thousand twenty six down the road. Golden One couldn't be happier to help. They're thrilled with the partnership. And they wire nine million dollars to Sacramento remigio sports and then he does it again with another deal. Jeff David does something very similar with Kaiser Permanente the training facility naming sponsored Kaiser Permanente ten years twenty eight million dollars. It's now a lot of these deals. That teams do with these kinds of sponsors. They have what's called an escalator was just a fancy. See Way of saying that there's an inflationary adjustment each annual payment so jeff. David goes to Kaiser Permanent Day and says hey rather than put escalators for each of the payments. Why don't you just give us four point four million dollars up front and we'll go without escalators? Kaiser says absolutely that's absolutely fine. They send four point. Four million dollars to Sacramento's that's why partners so the has over thirteen million dollars from Kaiser and golden one teams biggest sponsors ever that get wired into his account for his own personal gain in the kings know nothing about how does no one else in the organization. have any idea that happening you. This was a question that kept getting me when I was trying to get to the bottom of the mystery and I asked Jeff David. I said you ever worried that you know on game nights when all the sponsors and the Mucky mucks are down on the floor for warm-ups and everybody socializing in the Lexus Club. That your boss wouldn't be talking to the head of Golden One Donna. Bland and and say hey thanks for floating us that my million dollars and David said it he never actually were one of the things he said is. It's sort of like Thanksgiving dinner with your family like when the sponsors interact and I was primarily the point person when they're interacting with kings officials. No one's talking about the transactional nature of your sponsorship assertion dealer your deal structure. It's almost uncouth and the truth of the matter is everybody trusted Jeff David why not he was the. NBA's consummate soccer dad. He was really really good at this job. Everybody was happy everybody was instilled with the Sacramento rising sort of spirit. That's down hollow cores being built up in here the parties responsible multiple Ford. Everybody was having a really good time and nobody was talking about the transactions at any point does he come close to getting caught. A really interesting thing happens so when it comes time for golden to make their first annual payment this is not the nine million upfront. This is just their first annual July first payment they actually send the annual payment. That's it's due to the Kings to Sacramento Sports Partners Jeff Davids entity. David has to explain. Like oh no no no. This was just the account. It was really for that nine million dollar construction auction money. Now let me you need to. I'M GONNA give this back to you and you're going to wire it to the actual kings account so nobody thinks anything of this and and you think about it. Airs Happen All the time again. Nobody was on alert that the lead sponsorship executive in"