I feel that few people here know the truth about this situation. Some in this thread have pointed out that it seems likely there is an ulterior motive, but they don't know what that motive is. That ulterior motive is simple: this has always been about unions. Badawi is "persona non grata" because he supports player unions. Not for any other type of narrative Riot suggests. Below I will give a brief summary of the history leading up to this event.

When Badawi entered the scene he was met by an old boys club. In his earnest, competitive desire, he bent the rules to try to build the best team possible. However, the arcane "no poaching" rules are designed to help Riot and owners interests, not him. It is allowed to poach challenger players (and frequently happens), yet a challenger team like Renegades is not allowed to even walk by an LCS player. Frustrated by this process, he suggested to players that they could learn what they are worth, or that they might be worth a lot more than they think on the open market. Most of the discussion at that time center around whether he broke the rules or not, which in itself is arguable because he took measures to try to come as close as possible to breaking the rules without breaking them. However, more importantly, few people ever question the rules themselves. The intent of these rules are not to benefit players, but to benefit Riot and team owners at the expense of the players. According to Riot, if you want to make an offer for a player, the "legitimate" process is that you tell the team owner about your $x offer, whereby the management is under no obligation to inform the player of that offer. So for example if you pay your player $5k a month but they are worth $20k a month on the open market, they may never figure out the other teams want to pay $20k right now for you to play. Badawi said outright that he wanted a new era of esports management where players are treated equally, and one step towards that future was that he was mandating that contracts between him and his players would stipulate that he would forward all offers to the player.

He was also decidedly pro players-union. In total, these types of player-positive positions that he was trying to interject into the ethos of League esports, are a very serious affront to Riot Games' business interests. It must be understood how anti-union Riot Games is. At all costs, they will attempt to block a player union, because if one were to ever exist, it would be extremely damaging financially for them. The reason is, at the negotiating table, Riot Games is the one with the most to lose. For example, they may be paying a sum of $X to produce esports, but derive a benefit of 20*$X. This provides a lot of leverage to players if they are able to collectively bargain. In total, and with the right representation, player salaries would rise precipitously. In contrast, today many team owners instead want to build a "relationship" with players, often very young players, where they 'treat them right' on relatively trivial things like computer equipment, housing, food, etc. and thereby foster some sort of allegiance or loyalty to the owner and brand, that allows them to supercede fair market prices. You will often hear statements like "we treat our players very well", but by what metric? Without an open market you don't really know how well you are being treated. It may sound cushy as a top NA player to make say, $100k/yr playing league, until you realize that in China there are say, $500k-1M/yr offers for top players and you are being used. Many players never get to have their true worth determined by an open market because it is in the interest of both team owners and Riot to make sure one never exists. Keep in mind that for example in baseball, there are players that make over $25M a year.

Finally, Riot Games on the rulings themselves engage in behavior typical of prosecutions. They pair a lesser primary charge with dubious secondary charges. The secondary charges never stick but are meant to create a false impression / anchoring bias, and make the strong verdict more palatable, even when the secondary charges are thrown out later.

In 2015, Riot created or reinterpreted rules after the fact in a manner in which to punish Badawi. Badawi, who himself is a lawyer, knew that the deck was stacked against his favor but tried to angleshoot the rules as much as possible in his favor. Here is an email that Badawi had with Riot in 2015. http://imgur.com/XTzrIPy From Badawi's statement:

Riot presented to me their definition of tampering as “attempting to coerce a player to exercise his buyout.” This definition coupled with the language about behavior checks for owners constituted Riot’s warning to me in February. As previously mentioned, my conversation with Quas was solely regarding his future options after his contract expired at the end of the year. I never encouraged him to exercise his buyout clause. From what I was told at the time, this was not against any rules.

When Riot's 2015 ruling are read side by side with Badawi's statement, it was clear that Riot misrepresented many details of the situation in order to create a false impression that this was a slam dunk case. However, both the evidence against Badawi as well as the procedure of escalating warnings was flimsy at best. It was clear that Badawi wanted clarity of the rules in an effort to follow them (even while undermining them.) For example, the linked email was used as evidence that he was already previously warned not to poach players, and therefore it was justified to upgrade the penalty to an outright ban from the league. It must be repeated that the actual rule that they claim he violated (of which it is at best questionable whether Riot has presented any evidence that he did indeed break the rule), is in itself a bullshit rule that is designed to help Riot and team owners at the expense of players. At the time, shortly after the ruling, there was also a PR hitjob concurrently by the top 3 owners in the league that was a character assassination trying to make Badawi out to be a bad dude that lacks integrity, hoping that most people would dismiss him out of hand and that he would quietly go away.

In this month, Riot again ruled against Badawi. The primary charge is that he had a secret agreement to hold an ownership stake. The secondary charge, like usual, is FUD about him treating players badly. First, let's talk about the secondary charge. We know this is BS because the players have come out and said it is false. And we know that Riot would not care enough about a situation like this to take such unprecedent action, because many times Riot have failed to act on repugnant situations vis-a-vis team owners and players in Europe. The truth is probably that this was written on the wall for a year now. Under no circumstance should Badawi have anything to do with the league - he is effectively blackballed - for being pro-union.

Now let's talk about the primary charge: did Badawi have an ownership stake? Even before any evidence, a reasonable person must answer that yes, probably a backroom deal did happen, for example that Monte was gifted the team with the expectation that he give it back later. But does Riot have any proof? After all, such a deal probably is between Badawi and Monte and does not need to be spoken anywhere else. It is likely then, that there is no specific whistleblower. Furthermore, as an attorney higher in the thread pointed out, it is outside the bounds of Riot to "thoughtpolice" their agreement. It is sufficient that Badawi has no provable claim to the team, for example no contract with Monte or other legal device that allows him to regain his ownership stake in the team. Even if Monte were to give up 50% of the team to Badawi later out of charity, that is outside the bounds of what Riot can enforce in their "future ownership stake" provision.

Finally, this case has always been about PR. The most important thing for Riot is that they need the public to be on their side, even as they are anti-player so as to benefit their business. This is part of the reason why Monte was told 30 minutes before they released these "competitive rulings" (which are really just PR pieces in disguise that serve to 'explain' why they ban legitimate owners from their league.) By releasing their side of the story first, they get to control the narrative. If they had told others beforehand, then people like Badawi may be able to beat Riot to the punch in getting the first telling of the story, which is usually the strongest and the one that most people will feel is correct and compare future versions of the events to. In the end, most people reading these posts on reddit do not know the whole story and are not able to piece together all the facts.

TLDR: Badawi was blackballed since one year ago for being pro-union. The objective of Riot Games is for them to instigate anti-player policies to counter threats to their business interests, while maintaining public support/favor.