WASHINGTON — Attorney Michael Avenatti has been charged in a 36-count indictment with stealing more than $12 million from five clients and spending the money on his side businesses and even a private jet, federal prosecutors in California said on Thursday.
The 61-page indictment also charges the outspoken attorney with not filing taxes for nearly a decade; not paying the Internal Revenue service millions of dollars he owed; lying about his income on bank loan applications and a bankruptcy case; taking funds allocated for payroll taxes at his coffee company, and perjury.
A Santa Ana grand jury’s indictment against the flamboyant lawyer best known for formerly representing porn actress Stormy Daniels was unsealed Thursday after being filed late Wednesday, the U.S. Attorney’s Office said.
Daniels accepted a $130,000 payment from Michael Cohen, Donald Trump’s then-attorney and fixer, weeks before the 2016 presidential election that she and Cohen say was hush money for an affair she and Trump had. The president denies having an affair with her.
Avenatti, who had flirted with running for president in 2020, was arrested March 25 on initial charges of embezzling from one client and using fraudulent tax returns to obtain several bank loans, the U.S. Attorney’s Office said.
In one case, a mentally ill man was awarded a $4 million settlement from Los Angeles County in 2015 after he became a paraplegic. But Avenatti gave his client only a few sporadic $1,900 payments and a few rent payments, prosecutors allege. The majority of the settlement was used to finance the attorney’s coffee business, an auto racing enterprise and otherwise fund his lavish lifestyle, which includes a multimillion-dollar home in Laguna Beach, Calif, prosecutors said.
Prosecutors also allege that Avenatti took a $2.75 million award meant for another client and used those funds to buy a portion of a $5 million private jet. “We seized that jet yesterday,” U.S. Attorney for Los Angeles Nick Hanna said at a news conference.
Avenatti faces a maximum sentence of 333 years in federal prison plus a mandatory 2-year consecutive sentence for ID theft.
He quickly came out fighting on Twitter, saying: “I intend to fully fight all charges and plead NOT GUILTY. I look forward to the entire truth being known as opposed to a one-sided version meant to sideline me.”
Last month prosecutors in New York also charged the lawyer with trying to extort more than $20 million from Nike by threatening to expose its alleged bribery of college basketball players. He also denied any guilt in that case, and said the sportswear manufacturer is trying to retaliate against him. Nike has denied any wrongdoing.