Sources: Feds investigate Commanders’ finances

5:24 PM ET

The U.S. attorney’s office in the Eastern District of Virginia has opened a criminal investigation into allegations that the Washington Commanders engaged in financial improprieties, two sources familiar with the matter confirmed to ESPN on Wednesday.

The sources said that prosecutors are focused on several areas and that the inquiry was triggered by a letter the House Committee on Oversight and Reform sent to the Federal Trade Commission and several attorneys general in April that alleged deceptive business practices. Attorneys general in Virginia and Washington, D.C., also are investigating allegations of financial impropriety.

Team spokesperson Jean Medina did not immediately comment but provided a statement from attorney John Brownlee of Holland & Knight, who represents the Commanders.

“It is not surprising that ESPN is publishing more falsehoods based solely on anonymous sources — given today’s announcement,” the statement said. “…We are confident that, after these agencies have had a chance to review the documents and complete their work, they will come to the same conclusion as the team’s internal review — that these allegations are simply untrue.”

Asked Wednesday whether the league is aware of the federal criminal investigation, NFL spokesperson Brian McCarthy said: “We will decline comment.”

“The NFL in April engaged former SEC chair Mary Jo White to look into this matter,” McCarthy said. “The review is ongoing.”

White is leading the NFL’s second investigation into matters involving alleged sexual misconduct in Snyder’s organization, including the owner’s own alleged sexual assault of a woman on his plane in April 2009. It’s not clear when White will wrap up. The first investigation, led by Beth Wilkinson, resulted in a $10 million fine and a suspension for Snyder but produced no written report.

The U.S. attorney’s office and the FTC both declined to comment.

The House committee said in its letter to the FTC that it had found evidence of deceptive business practices over the span of more than a decade, including withholding ticket revenue from visiting teams and refundable deposits from fans. The committee outlined, through the testimony of former employees and access to emails and documents, a pattern of financial impropriety by owner Dan Snyder and team executives. At one point in 2016, the team retained up to $5 million from 2,000 season-ticket holders while also concealing sharable revenue from the league, according to the committee.

One former employee testified before Congress, saying the team had two separate financial books: one with underreported ticket revenue that went to the NFL and the full, complete picture. According to testimony, Snyder was aware of the numbers shared with the league while also being privy to the actual data. The business practice was known as “juice” inside Washington’s front office.

According to other testimony, financial misconduct included making it intentionally difficult for season-ticket holders to recoup refundable deposit money, counting some of those leftover funds as a different kind of revenue that doesn’t need to be shared with the league and shifting money from ticket sales for NFL games to other events at FedEx Field as a way of hiding that money from the league. The committee in the letter shared spreadsheet data showing evidence of deposits that were not returned. Citing emails and the testimony of Jason Friedman, a longtime vice president of sales and customer service, the letter said ticket sales from Washington games were shifted to a 2013 Kenny Chesney concert and a 2014 Navy-Notre Dame college football game as a way to “juice” revenue and keep it off the books shared with the NFL.

“The Washington Commanders have fully cooperated with federal and state investigators since the House Oversight Review Committee sent its letter to the FTC on April 12, 2022 — now nearly 7 months ago,” the statement from Brownlee said. “The team has produced tens of thousands of records in response to the requests. The investigations, which ESPN’s anonymous sources have mischaracterized, are premised on the same baseless allegations made by a disgruntled former employee, Jason Friedman, who also is represented by the law firm of Katz Banks.”

Also on Wednesday, Dan and Tanya Snyder announced that they have hired Bank of America Securities to explore potential transactions involving the team. It’s not clear what those transactions might be, whether it was the sale of the team or they are pursuing minority partners.

ESPN senior writers Seth Wickersham and Tisha Thompson and The Associated Press contributed to this report.