After receiving a tip in 1993, the IRS launched Operation Slam Dunk and publicly notified more than 50 referees on September 12, 1994, that they were subjects of a criminal tax investigation. Reported amounts of unreported income ranged from roughly $8,000 to $100,000. Over the next four years, 25 officials were sent to the IRS civil division for audits, while the Justice Department ultimately indicted 12 despite the government’s estimate that the lost tax revenue fell below normal criminal-prosecution guidelines. Eleven of those 12 referees pleaded guilty in 1998. Steve Javie fought the case and was acquitted after his attorneys challenged the IRS’s calculations and argued that more than $84,000 at issue represented value derived from frequent-flyer miles, which he contended were not taxable income. Ken Mauer was the only other referee to reject a plea bargain; he was convicted of felony tax evasion, three counts of tax evasion, and obstruction of justice, receiving five months of house arrest, three years of supervised release, and 800 hours of community service. Referees including Jesse Ray Kersey and George Tolliver also received probation, fines, community service, or home detention. Although the officials were forced to resign, they were later rehired by the NBA, making the episode an extraordinary clash between league compensation practices, tax law, and the criminal justice system rather than a conventional on-court officiating scandal.
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