Kawhi Leonard trade holdup, explained: Why Clippers-Raptors swap is being held up by NBA investigation

The Toronto Raptors agreed just before the start of free agency to bring back Kawhi Leonard, working out a blockbuster trade with the Los Angeles Clippers.

While the NBA's moratorium lifted on July 6, allowing the two sides to complete the deal, it might not be made official any time soon.

The Raptors and Clippers announced Thursday that they were holding off on the trade pending an NBA investigation, with each team releasing a statement explaining its side of the story.

Here's what you need to know about the Leonard trade.

MORE: How Kawhi Leonard fits with Raptors

Why is the Kawhi Leonard being held up?

The Leonard trade won't be completed until the NBA's investigation into an alleged salary cap violation by the Clippers is complete, ESPN's Shams Charania reports.

By all indications, the NBA itself isn't blocking the deal. Instead, the Raptors released a statement saying they were informed by the NBA that they "would assume the risk of any potential outcome of the investigation" involving Leonard. Once they received that notice, the Raptors say they decided to "wait until the league's investigation is complete."

The Raptors reiterated that they "remain eager to bring Kawhi back to Toronto" and are hoping for a "swift resolution."

Raptors’ full statement: pic.twitter.com/axpGsa6nN3

The Clippers, meanwhile, said they were "informed that the trade can only be finalized if the Raptors' ownership group assumes the risk of penalties related to Kawhi's contract" related to the investigation, adding that they still expect the trade to be finalized once the investigation is complete. 

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Why is the NBA investigating the Clippers?

The NBA is investigating potential salary cap circumvention by the Clippers and Kawhi Leonard involving a sustainability company named Aspiration.

The story first surfaced as part of an investigative report by Pablo Torre, who cited a source that claimed the Clippers worked out a deal with Aspiration and used it to funnel an additional $28 million to Leonard without it counting toward the salary cap.

Aspiration dissolved in 2025 after co-founder Joe Sanberg was arrested on fraud charges.

The Clippers have denied the allegations all along and denied them again on Thursday, saying as part of a lengthy statement, "We did not funnel money to Kawhi Leonard through Aspiration" and claiming that they were victims of fraud. The NBA's investigation is ongoing, however.

Could the NBA void the Kawhi Leonard trade?

Based on reporting and team statements, it doesn't appear the NBA is threatening to void the deal altogether. The NBA instead told the Raptors that they would be on the hook for any penalties related to Leonard's contract, and a suspension for Leonard theoretically would affect Toronto as well.

If Leonard stays with the Clippers until the investigation is complete, the Clippers would remain on the hook for any potential punishments, and the Raptors would then be able to weigh whether a deal still makes sense.

Kawhi Leonard contract details

Leonard is heading into the final year of a three-year, $149.5 million contract extension. He has reportedly expressed a willingness to sign a long-term extension with the Raptors, but that process is of course on hold until the trade is complete.