LOS ANGELES (AP) – Federal prosecutors painted a picture of attorney Michael Avenatti on Thursday as a scheming operator who stole millions of dollars from clients, cheated on his taxes, lied to investigators and tried to hide money from debtors in bankruptcy proceedings.
A 36-count indictment returned late Wednesday in U.S. District Court in Santa Ana, California, offered the most damning and detailed account to date of Avenatti’s apparent fall from grace a year after he seized the spotlight while crusading for porn actress Stormy Daniels in her legal battles against President Donald Trump.
Avenatti embezzled settlement funds and proceeds from other matters he handled from five clients and doled out small portions of what they were due to “lull” them into thinking they were getting what they were owed, prosecutors said.
“Money generated from one set of crimes was used to further other crimes,” U.S. Attorney Nick Hanna told reporters. “Typically in the form of payments designed to string along victims so as to prevent Mr. Avenatti’s financial house of cards from collapsing.”
Avenatti denied the charges on Twitter, saying he had made powerful enemies and would plead not guilty and fight the case.