Sources: TSM League coach Peter Zhang fired for alleged financial irregularities

Peter Zhang coaching TSM in LCSColin Young-Wolff for Riot Games

TSM sacked League of Legends coach and head of player development Peter Zhang on March 19, citing “serious allegations of conflict of interest.” Sources have since told Dexerto the reasons behind his dismissal came from an agent-style setup where he’d secure Chinese and Taiwanese players spots on the team for a cut of earnings.

On March 19, TSM made the surprising announcement that they would be immediately terminating the contract of League of Legends coach Zhang “Peter Zhang” Yi.

The short accompanying statement presented by the LCS organization read: “We were recently made aware of very serious allegations of conflict of interest and unethical practices against League of Legends coach Peter Zhang.

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“After an initial investigation, we have terminated him effective immediately. We are working with external legal counsel to complete a full investigation.”

This development is the latest in a long line of controversies for the TSM brand. Despite their position as one of North America’s most popular esports entities, they have found themselves consistently under fire for serious managerial missteps.

Former President Leena Xu was at the center of a long controversy regarding her relationship with then player Yiliang ‘Doublelift’ Peng, a conflict of interest by most professional standards as she was directly responsible for deciding if he was re-hired and the details of his contract.

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This later blew up into further controversy when she leaked details of the team’s former jungler Joshua ‘Dardoch’ Hartnett having trouble finding a new home on Peng’s stream, details that seriously undermined Hartnett’s potential bargaining power.

At the end of 2021, Peng would leave TSM and speak openly about negative experiences with the owner Andy ‘Reginald’ Dinh. Peng’s departure would be followed by Xu, coach Søren ‘Bjergsen’ Bjerg, and General Manager Parth Naidu. This would lead into a public report on Wired that revealed Dinh was being investigated for bullying and harassment both by an independent body appointed by TSM and Riot Games themselves.

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Twitter: TSM
Reginald’s organization, and himself, have been under scrutiny recently.

Given how adjacent to controversy they have been of late many started to speculate the severity of the offences that had made TSM terminate Yi. A common narrative that cropped up across Reddit and Twitter was that it must have something to do with match-fixing, an issue that saw 38 players, managers and coaches banned across the Chinese LPL and LDL divisions in April 2021.

In the resultant Reddit thread reacting to Yi’s firing, LCS Commissioner Jackie Felling made a point to try and stop speculation about it pertaining to match-fixing.

“Nothing to do with matchfixing,” Felling said. “This is an internal team matter. Not making a statement from Riot at all but I don’t want people to think this had anything remotely to do with matchfixing or betting which it does not.”

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Following our own investigation, Dexerto can now confirm the reasons for the sudden departure of Peter Zhang.

Sources familiar with the matter explained to us that TSM believed he had been using  his coaching position for self-enrichment via the method of taking money in exchange for ensuring certain Taiwanese or Chinese players were added to the roster. For guaranteeing their acquisition to TSM, he would take a proportion of their earnings paid as a fee; essentially positioning himself as simultaneously a team coach and international agent.

The claim is that Yi in his capacity as coach would work with management to select players for the roster, then that he would then go to the player in question and offer to act as their “agent” stating that he could get them on the TSM roster if they allowed him to represent them. For negotiating the deal he would take a cut of the players earnings, often much higher than a standard agent’s fee, for brokering the deal.

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Peter Zhang coaching TSM in LCSRiot Games
Zhang reportedly had an agent-style agreement with Chinese and Taiwanese players to secure them spots on TSM’s rosters.

In addition to this, the same source informed us that Yi was also borrowing significant sums of money from many figures under the TSM organization, including players across both the main and academy roster. The use of this money, said to be a “sizeable” amount in total, are not clear although Yi himself cited a medical emergency involving his grandparents. The veracity of this claim is not clear but when affected parties raised concerns about the loans they started to be paid back. At the time of reporting this almost all the money has been recouped.

In regards to the matter of these loans, Riot Games are currently investigating the matter and will likely expand their investigation to encompass any impropriety around his dual role as a team coach and player agent. 

“There are other reasons for their release,” the source concluded, “but those are the two most significant.”

Dexerto spoke at length with Yi about these allegations which he explained were either a misunderstanding or malicious framing of the events. 

First, he explained that at no point was he acting as a player agent. He admitted that he was receiving a percentage of TSM Academy player Wang “Yursan” Sheng-Yu’s salary, $1000 per month, but that this fee was being sent to his actual agent and that he was merely a conduit for the transaction.

He added that he had often exchanged Yuen for dollars for players across the squad as he was a US Green Card holder and had bank accounts in both countries that made it easier. He believes these transactions might give the appearance of wrongdoing.

In regards to the need for sudden loans he explained that he did have a family emergency and provided proof he had asked for time off to return to China for this matter. However, the need for the loans was precipitated by his former player Hu “SwordArT” Shuo-Chieh. 

According to Yi during SwordArT’s time on the team he had worked with Yi to sell an $80,000 car he had purchased for use during his time in the US. After his return to China to play for Weibo Gaming, Shuo-Chieh asked Yi to sell the car for him and send him the money. Upon sale of the car Yi had kept the money and was stalling payment due his grandmother’s surgery.

Earlier in the month Shuo-Chieh had demanded the money back and had stated that if he was not paid he would go public about the debt. With the money spent Yi turned to the players on the organization for loans to ensure the matter was not made public.

“I recognize that keeping the money [from the sold car] was wrong,” he said “but I was working towards paying that debt and paid half before I was fired. My grandmother’s bill was due at the end of this month and so I wasn’t able to pay both debts. I was having a very hard financial time but I will pay back every penny to SwordArT. The other claims against my person are not true. It is common in China for friends and colleagues to loan each other money. I have learned a hard lesson about the cultural differences in America. I will work with Riot in any investigation and have evidence necessary to prove my innocence.” 

As part of our discussions with Yi he showed us receipts of transactions that he claims were for money exchanges done with the full knowledge and approval of the other parties involved.

Currently, Yi plans to fly back to his native China ahead of any public statements from TSM. Dexerto understands TSM are considering legal action. TSM told Dexerto “we have no additional comment beyond our original statement at this time.”