A former Sacramento Kings executive allegedly used $13.4 million in sponsorship money to purchase beach houses, according to a report from The Sacramento Bee. It’s a detailed report that we’ll share some of, but I’d encourage you to read the whole thing.

The FBI and federal prosecutors are investigating Jeffrey R. David, 44, the former chief revenue officer for the Kings who currently holds the same position with the NBA’s Miami Heat, for what sources say was a sophisticated money-laundering scheme that allegedly diverted $9 million from the Golden 1 Credit Union and another $4.4 million from Kaiser Permanente Foundation. David, whose position with the Kings was eliminated on June 1 and who joined the Miami Heat as chief revenue officer in July, did not respond to a message seeking comment that was left on his cellphone voice mail early Thursday. No criminal charges have been filed in the case, which was referred to federal investigators by the Kings a week ago.

According to the Bee, the Kings stumbled onto the scheme while holding a scheduled internal audit through a folder named “Turbo Tax” on a team computer, conducted a swift internal investigation, and quickly involved the FBI.

To summarize the scheme, David contacted sponsors offering a discount in the future if they paid a larger amount up front. The sponsors, having dealt with David before (again he was in charge of these kind of things) never realized anything was suspicious and agreed to the payments. He then diverted that money to buy beach houses which he remodeled and intended to sell at a markup. Since the current payments would still be coming in as usual and nobody at the Kings but David knew about these additional payments, there wouldn’t be any red flags in accounting for years. He probably could have gotten away with it if he hadn’t kept evidence on work computers and if the Kings hadn’t been so thorough with their computer audit.

Your interpretation may vary but to me this doesn’t necessarily reflect poorly on the organization, but rather on a greedy man who overreached and bit off more than he could chew. We’ll update if any additional information comes in.