The Washington Commanders have reportedly been accused of "potentially unlawful" financial conduct by the House Committee on Oversight and Reform.
Per Mark Maske and Nicki Jhabvala of the Washington Post, the committee made the accusation in a 20-page letter sent to the Federal Trade Commission on Tuesday.
The letter contains allegations made by Jason Friedman, who used to work for the franchise as a vice president of sales and customer service:
"The letter says Friedman told committee members the team maintained 'two sets of books,' including one set of financial records used to underreport certain ticket revenue to the NFL. The letter cites documentation that the team’s financial improprieties may have extended to tickets registered in Commissioner Roger Goodell’s name. It references evidence that it says indicates the revenue gained by the team through these practices was known internally as 'juice,' and it details allegations that the Commanders improperly attributed such revenue to being derived through a Navy-Notre Dame college football game at FedEx Field or a Kenny Chesney concert, so that it wouldn’t be part of the NFL’s revenue-sharing pool."
Other allegations made against the Commanders and owner Dan Snyder in the letter include "withholding as much as $5 million in refundable deposits from season-ticket holders and also hiding money that was supposed to be shared among NFL owners."
Maske, Liz Clarke and Paul Kane reported March 31 the congressional committee looking into the NFL's handling of sexual harassment allegations in the Commanders' workplace expanded its investigation amid allegations of financial improprieties under Snyder's ownership.
The committee told the Federal Trade Commission in the letter it was "providing the information and documents uncovered by the Committee for your review, to determine if the Commanders violated any provision of law enforced by FTC and whether further action is warranted."
Per the letter, Friedman "provided the Committee with information and documents indicating that the Commanders routinely withheld security deposits that should have been returned to customers who had purchased multiyear season tickets for specific seats, referred to as seat leases."
Friedman also told the committee that Washington employees were directed by team executives to "establish roadblocks to prevent customers from obtaining the security deposits they were due—effectively allowing the team to retain that money."
Between Friedman's interview with the committee and documents he provided, the committee said the Commanders "had unreturned security deposits for 'around 2,000 accounts' belonging to customers and fans" that amounted to around $5 million.
Friedman said in his testimony to the committee that Snyder and Mitch Gershman, Washington's current chief marketing officer and former chief operating officer, instructed him to "identify security deposits that are on dormant accounts where, in my estimation, the likelihood of the customer coming forward and asking for their deposit back is as close to zero as possible, and then return the security deposit in the system and convert the credit that would then be on the customer’s account into juice."
Per Maske and Jhabvala, this practice would allow the team to circumvent league rules to avoid making contributions to the local revenue pool that teams are required to share with the league and the other franchises.
In a statement last week, the Commanders denied allegations they were withholding ticket revenue.
"Those revenues are subject to independent audits by multiple parties," the team said in its statement. "Anyone who offered testimony suggesting a withholding of revenue has committed perjury, plain and simple."
In July, the Commanders were fined $10 million following the league's investigation into allegations of a toxic workplace. Snyder also ceded control of the team's day-to-day operations to his wife, Tanya Snyder.
NFL Commissioner Roger Goodell told reporters last month he expects Tanya Snyder will remain in control of the daily operations with the club for "at least the foreseeable future," but he will talk about that with Dan Snyder "at some point."
Snyder purchased the Washington franchise in 1999 following the death of previous owner Jack Kent Cooke.