Michael Avenatti Charged With Bank, Tax Fraud in Grand Jury Indictment

Michael Avenatti Charged With Bank, Tax Fraud in Grand Jury Indictment

Michael Avenatti Charged With Bank, Tax Fraud in Grand Jury Indictment

Federal prosecutors said Thursday that attorney Michael Avenatti has been charged in a 36-count federal indictment in Southern California.

The indictment announced Thursday in Los Angeles alleges Avenatti stole millions of dollars from clients, didn't pay taxes, committed bank fraud and lied during bankruptcy proceedings.

In all, Avenatti has been charged with 10 counts of wire fraud, 19 tax-related offenses, two counts of bank fraud, and four counts of bankruptcy fraud, while he remains free on the $300,000 bond he posted last month. In one case, Avenatti is accused of stealing funds from a paraplegic client after he helped them win a legal settlement.

The indictment also accuses Avenatti of various tax crimes.

"Money generated from one set of crimes was used to further other crimes", U.S. Attorney Nick Hanna told reporters.

Cohen pleaded guilty and is set to report to prison next month, and Avenatti and Daniels have parted ways.

As prosecutors outlined the charges, Avenatti appeared briefly in Los Angeles Superior Court to answer questions about money he owes attorney Jason Frank for legal work he performed.

Avenatti has already been charged with fraud and embezzlement in U.S. District Court in Santa Ana, California, and is charged in a separate federal complaint in NY with what prosecutors said was an attempt to "shake down" Nike Inc for more than $20 million.

The maximum sentence Avenatti would face if convicted is 335 years in prison.

On the day of his arrest, federal agents executed search warrants at Avenatti's Century City apartment, his Echo Park law office and the Yorba Linda home of Judy Regnier, the office manager at Eagan Avenatti, according to the USA attorney's office.

Although Avenatti was due a portion of settlement funds for his work, the charges said he paid only a fraction of the money clients were due in some cases and strung them along while they waited to be paid.

"Mr. Avenatti received the money on behalf of clients and simply took the money to finance his businesses and personal expenses", Hanna said. Avenatti never informed Johnson of the $4 million settlement, and instead funneled it to GB Autosport, LLC - a company he established to manage his race-car team - and to his failed coffee company, Global Baristas LLC.

Avenatti had Johnson sign a document a day or two later saying he was satisfied with his representation, which the lawyer told him was necessary to get the settlement that had in fact been paid four years earlier, the indictment said.

The lawyer had a rapid rise to fame, most prominently representing Stormy Daniels in the adult film actress's case against President Trump.

The New York prosecutors have separately accused Avenatti of trying to blackmail Nike Inc for more than $20 million.

In an emailed statement, law firm Greenberg Gross LLP identified Client 1 as a man named Geoffrey Johnson.

In November 2018, Johnson asked Avenatti to send information on the settlement to the Social Security Administration so it could gauge his eligibility for disability payments.

Listen to the Guys Who Law talk about Avenatti's troubles below!

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