Michael Avenatti Indicted On 36 Counts Of Embezzlement, Fraud, And Other Financial Crimes.

Michael Avenatti Indicted On 36 Counts Of Embezzlement, Fraud, And Other Financial Crimes. March 31, 2023Leave a comment

On Thursday, the Justice Department filed a 36-count grand jury indictment against attorney Michael Avenatti. According to the Los Angeles Times, the document filed in the federal district court in California by the Department for Justice includes counts of perjury, embezzlement, fraud, failure to pay taxes, and other financial crimes.

The document was filed just two weeks after Avenatti was charged by federal prosecutors for bank and wire fraud in California. The charges are related to his failure to inform a client that he had received a settlement in the amount of $1.6 million.

Later that same day, U.S. attorneys indicted Avenatti, who formerly represented Stormy Daniels, for allegedly attempting to extort up to $25 million from the Nike Corporation. On Thursday, the DOH said in a news release: “The criminal charges in the indictment address four areas of wrongdoing: the embezzlement of millions of dollars that should have been paid to clients, the failure to file income tax returns and failure to pay the IRS millions of dollars in taxes, the submission of fraudulent loan applications that included tax returns never filed with the IRS, and the concealment of assets from the Bankruptcy Court.”

According to the release, U.S. attorney Nick Hanan stated that all of the crimes Avenatti is currently being charged with are intertwined. “These four areas of criminal conduct alleged in the indictment are all linked to one another because money generated from one set of crimes appears in other sets — typically in the form of payments to lull victims and to prevent Mr. Avenatti’s financial house of cards from collapsing,” he said.

Ryan L. Korner, Acting Special Agent in Charge with IRS Criminal Investigation in Los Angeles, spoke about the tax-related charges brought up against Mr. Avenatti. Korney explained that Avenatti had bigger priorities to take care of, like a coffee shop chain and racing sports cars. In the release, Korner said: “The financial investigation conducted by the IRS details a man who allegedly failed to meet his obligations to the government, stole from his clients, and used his ill-gotten gains to support his racing team, the ownership of Tully’s coffee shops, and a private jet.”

According to CNBC, the grand jury said that Avenatti “would misrepresent, conceal, and falsely describe to the clients the true terms of” more than $12 million worth of settlements that he had received for them in their civil cases. According to CNBC, “And he would also allegedly lie to the clients by saying the settlements had not yet been paid, or that they were delayed for legitimate reasons.”

On Wednesday, federal authorities seized a jet that Avenatti allegedly paid for with a client’s $2.75 million settlement. The jet was valued at $5 million. In total, the indictment includes allegations from five different clients. The list includes a paraplegic man that Avenatti represented in a case against Los Angeles County. According to the Justice Department, “The county paid a $4 million settlement in January 2015, but within months Avenatti had drained the entire settlement payment from his law firms’ trust account and used portions of the settlement to finance his coffee business or pay personal expenses.”

In an apparently deleted tweet, Avenatti responded to the Justice Department by defending his innocence and stating that the indictment is meant to “sideline” him. “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,” wrote Avenatti. In another tweet posted by Avenatti, he described the allegations that he mishandled his client’s funds as “bogus nonsense.”

In a third tweet that was also deleted by Avenatti, he stated that throughout his entire career he had been standing up for powerless clients and he predicted that he would be exonerated. In his tweet, Avenatti said: “For 20 years, I have represented Davids vs. Goliaths and relied on due process and our system of justice. Along the way, I have made many powerful enemies. I am entitled to a FULL presumption of innocence and am confident that justice will be done once ALL of the facts are known.”

Just this past December, Stormy Daniels was ordered by a federal judge in Los Angeles to pay Donald Trump nearly $300,000 in legal fees for her failed defamation suit against him. Avenatti is scheduled to appear in federal court in Santa Ana, California to face his indictment on April 29.

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