A federal grand jury in Los Angeles indicted celebrity attorney Michael Avenatti on 36 counts, including embezzlement, wire fraud, tax evasion and bank fraud connected to his alleged theft of tens of millions of dollars.
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. He said he will fight the indictment and claimed the charges were a result of his "many powerful enemies". Check back for updates.
Prosecutors said in one case, Avenatti funneled a $2.75 million settlement into his bank accounts and spent $2.5 million on a private jet that he co-owned.
"Money generated from one set of crimes was used to further other crimes, typically in the form of payments created to string along victims so as to prevent Mr. Avenatti's financial house of cards from collapsing", U.S. Attorney Nicola Hanna in Los Angeles said Thursday at a press conference.
"I look forward to the entire truth being known as opposed to a one-sided version meant to sideline me", he wrote.
He added later: "Any claim that any monies due clients were mishandled is bogus nonsense".
The court ordered federal agents to seize Avenatti's jet at Santa Barbara Airport on Wednesday. He was charged in a criminal complaint in Santa Ana, California, on March 25 for stealing a different client's $1.6 million settlement to cover his own expenses, as well as cheating a MS bank. In the NY case, Avenatti is accused of attempting to extort more than $20 million from sportswear company Nike.
In one of these cases, Avenatti represented Geoffrey Johnson, a paraplegic on disability, against the County of Los Angeles where a $4 million settlement was reached in 2015.
The indictments against Avenatti are for wire fraud, tax fraud, bank fraud and bankruptcy fraud. One of his businesses, Global Baristas US LLC, failed to file employment tax returns and didn't pay $3.2 million in federal payroll taxes, which had been withheld from employee paychecks. Instead, according to the indictment, Avenatti gave his client periodic "advances" of no more than $1,900 and paid the rent for his assisted living facility. She sued the president over a nondisclosure agreement that in the weeks before the 2016 USA presidential election kept her from discussing her claims that she and Trump had an extramarital affair 10 years earlier.
Hanna said the Avenatti case "has nothing to do with anything political or with anything else".
Further, Avenatti faces two counts of bank fraud relating to filing false tax returns to obtain millions of dollars in bank loans, and four counts of bankruptcy fraud for lying about the bankrupty concerns surrounding his law firm Eagan Avenatti. He's also defending himself on Twitter.