Avenatti Indicted for Stealing $1.6 Million From a Client

(Bloomberg) -- Celebrity lawyer Michael Avenatti, who made his name as a fierce critic of President Donald Trump, was indicted by a federal grand jury in California on three-dozen charges, including stealing a client’s $1.6 million settlement, a spokesman for prosecutors said.

The indictment moves Avenatti, 48, a step closer to a trial. He was charged in a criminal complaint in Santa Ana, California, on March 25 for using the client’s settlement money to cover his own expenses, as well as cheating a Mississippi bank. On the same day, prosecutors in New York accused him of trying to extort millions of dollars from Nike Inc.

The new indictment adds additional claims including wire fraud and and tax violations, according to Ciaran McEvoy, a spokesman for U.S. Attorney Nicola Hanna in Los Angeles.

Avenatti, who gained notoriety by representing the porn actress Stormy Daniels in a lawsuit against Trump, denied the allegations and said the case comes after two decades of representing "Davids vs. Goliaths."

"Along the way, I have made many powerful enemies," he said in an emailed statement. "I am entitled to a FULL presumption of innocence and am confident that justice will be done once ALL of the facts are known."

The indictment requires Avenatti to appear in court to enter a plea to the charges. The judge may also set a trial date. Additional details of the indictment weren’t immediately available. Prosecutors in New York, where he hasn’t been indicted, didn’t have an immediate comment.

Avenatti capitalized on his raised profile by repeatedly assailing Trump and his former attorney, Michael Cohen. He even floated a possible presidential run.

In the California case, Avenatti allegedly defrauded a bank in Mississippi, submitting false tax returns to get three loans for over $4 million in 2014 for his law firm and a company he owns, Global Baristas US LLC. He also misappropriated a $1.6 million settlement agreement he’d arranged for a client and spent the money on expenses for a coffee company, which operates as Tully’s Coffee in California and Washington State, they said. He’s accused of wire fraud and bank fraud, among other charges.

In the New York case, Avenatti said last month that the case was pushed by Nike in an attempt to distract attention from the company’s crimes. Avenatti also disputed Nike’s claim that it’s been cooperating with a probe into corruption in college basketball, as Nike said after Avenatti was arrested outside the company’s law firm.

Just before his arrest in New York, the embattled lawyer had posted plans to hold a press conference to unveil a case he claimed would show how “criminal conduct reached the highest levels of Nike.” According to prosecutors, he told lawyers at Boies Schiller Flexner LLP that he’d cancel the event if Nike paid more than $20 million for him and another lawyer to conduct an internal investigation, and his client.

The case is U.S. v. Avenatti, 19-mj-241, U.S. District Court, Central District of California (Santa Ana).

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