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Commanders respond to congressional allegations of financial impropriety

Former FTC official says agency unlikely to take direct action against Snyder, investigating NFL revenue sharing allegations "not a good use of taxpayer resources"

WASHINGTON — The Washington Commanders sent a 22-page letter to the Federal Trade Commission (FTC) Monday strongly denying allegations of financial impropriety within its ticket office. The letter was in response to Congress alleging "concerning business practices" by the Washington Commanders and owner Daniel Snyder. 

The latest letter, written by Commanders team attorney Jordan Siev and addressed to FTC Chair Lina Kahn, claims the allegations "relies solely on the uncorroborated, false testimony of a single disgruntled former employee" and is "easily and fully rebuttable." Siev goes on to say that the Commanders were not given a chance to refute the claims Congress' letter made before it was sent to the FTC. 

The letter from the Commanders also includes 83 pages of exhibits, including signed affidavits refuting the former employee's claims.  

READ: Washington Commanders letter to the FTC. 

The House Committee on Oversight and Reform sent its own letter to the FTC on April 12, saying it had reviewed claims from a former employee that the team withheld up to $5 million in refundable deposits from more than 2,000 season ticket holders and hid money that should've been shared with the league. 

"Evidence obtained by the Committee, including emails, documents, and statements from former employees, indicate senior executives and the team’s owner, Daniel Snyder, may have engaged in a troubling, long-running, and potentially unlawful pattern of financial conduct that victimized thousands of team fans and the National Football League (NFL)," the letter begins.

The letter goes on to allege that the Commanders underreported ticket revenue and kept two sets of financial books in order to hide funds owed to the NFL. The allegations are largely based on information coming from former Commanders sales executive Jason Friedman, who worked with the team for 24 years.

RELATED: Congress: Evidence found supporting financial impropriety by Washington Commanders

Jessica Rich, a former director of the Federal Trade Commission’s Bureau of Consumer Protection, believes Washington Commanders owner Daniel Snyder is unlikely to face serious regulatory or criminal action stemming from allegations of financial improprieties within the organization. She told WUSA9 that while she expects the FTC to investigate allegations detailed by the House Committee on Oversight and Reform, the matter would not rank high on the list of regulatory matters already in front of the agency.

“There is conceivably a case the FTC could bring, but given everything on its plate and its limited resources, it’s not as compelling as other cases,” Rich said.

Rich said while Friedman’s allegations are troubling, his claims would need to be substantiated by FTC investigators.

“Whistleblowers can be very valuable to an investigation,” Rich said. “However, they are not always perfect witnesses especially when they participated in the alleged illegal conduct. The FTC would want to corroborate any evidence provided by the whistleblower.”

Credit: Kelley Drye
Jessica Rich, former director of the Federal Trade Commission’s Bureau of Consumer Protection

Rich said a potential FTC investigation would face a number of logistical challenges, including a backlog of pending cases already in front of the agency. Rich also said procedural changes now require FTC investigators to prove fraud allegations in one proceeding, then go to court in a second proceeding to get money back for fans.

Typically, Rich said the FTC focuses its limited resources on cases that impact more consumers and bigger dollars than those detailed in the Commanders case.

“This is not as appealing a target as massive fraud on numerous consumers who cannot protect themselves,” Rich said.

Shortly after the letter to the FTC was first reported, fans who spent years hoping Snyder would be forced to sell the team wondered if this latest round of allegations might finally be the end for the owner.

“There's been other things that have happened in the past, you know, different topics," said long-time season ticket holder Brian Burroughs. "You may have thought, 'wow, okay, this is really the time where he's going to be forced out. And he wasn't. I don't know if he's been protected by the other owners ... As a fan of the team, I would really like to see a different direction.”

Other fans asked if allegations that the Commanders withheld revenue from other teams might cause fellow owners to force Snyder out. But Rich said it’s unlikely any of those details ever see the light of day. FTC investigations are non-public, and the NFL is not a government agency that could ask for a public briefing.

While it is possible the House Committee on Oversight and Reform could be briefed on the FTC’s findings, the agency’s mission is to protect small consumers and companies that cannot protect themselves, not disputes between billion-dollar entities like the NFL and its franchises.

“It would not be a good use of our taxpayer resources for the FTC to protect the NFL from a particular team,” Rich said. “The NFL can protect itself.”

Additionally, Rich said the FTC does not have criminal enforcement authority, so even if they found criminal conduct, they would have to refer it to another agency, such as the Department of Justice or the Attorney General’s office in states where the affected fans live -- a process that Rich said could take more than a year.

RELATED: NFL to conduct investigation into Dan Snyder sexual harassment allegations

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