The US House Oversight & Reform Committee is indeed investigating potential financial irregularities within the Washington Commanders organization. The Committee now wants a federal agency involved.
According to Washington Postthe committee sent a 20-page letter to the Federal Trade Commission regarding allegations that the team may have withheld up to $5 million in refundable deposits from season ticket holders, and that the team may have hidden from money that was to be shared by all NFL franchises.
Former Washington employee Jason Friedman, who spent nearly a quarter century with the organization, told the Committee that the team kept two sets of books and one set of financial information underestimated the revenue from league tickets. The process of intentionally allocating revenue to the wrong event was known, according to Friedman, as “juicing” the team would have allocated revenue that should have been shared with the league to non-NFL events at FedEx Field.
As bad as that sounds, it’s separate from an alleged scam to keep subscription holders’ security deposits.
Friedman, according to the letter, “provided the Committee with information and documentation indicating that commanders routinely withheld security deposits that should have been returned to customers who had purchased multi-year subscriptions for specific seats, known as seat leases,” and that “team leaders instructed employees to set up roadblocks to prevent customers from getting the security deposits they were owed, thereby allowing the team to keep that money.
These claims will remind some of the discount controversy that culminated in a multi-year investigation into Pilot Flying J, the truck stop company owned and operated by Browns owner Jimmy Haslam. Haslam somehow avoided prosecution in this case. If Friedman’s evidence is accurate and convincing, members of the commanders’ organization might also have to worry about the indictments. Including owner Daniel Snyder.
The practices apparently ended in 2017, according to Friedman.
Here is an example of how the “juice” practice would have worked. Friedman told the Committee that he “falsely processed” $162,360 in Commanders ticket revenue from a Navy-Notre Dame game at FedEx Field. The team’s former chief financial officer, Steven Choi, allegedly ordered Friedman to do it that way, in a May 6, 2014 email.
“So those are the two sets of books,” Friedman told the Committee, based on the letter obtained by the To post. “So in this particular case there is a set of books that is submitted to the NFL that does not include the $162,000, but then there is a set of books that is kept internally shown to Mr. Snyder and to Mr. Snyder – I just believe Mr. Snyder, actually, and people around him maybe, it shows what we actually did, which would include the $162,000 of juice.
If Friedman has any documents to support his claim, that’s a major problem for the organization and for Snyder. Likewise, it’s impossible for the league to remain silent on this matter – although some members of the league office would probably prefer nothing to come of it.
Those who should have caught him will face some tough questions from the other teams. Especially given the all-too-comfortable relationship between NFL General Counsel Jeff Pash and former team president Bruce Allen.
Where it goes now remains to be seen. The FTC should investigate. A local prosecutor should investigate. The NFL should investigate. Lawsuits should be brought, especially by those whose security deposits may have been stolen – if Friedman’s allegations are correct.
Ultimately, it might be time for the NFL to finally get rid of Daniel Snyder. It’s probably been a long time.