Lawyer Avenatti Charged in California With US Fraud, Tax Crimes

Lawyer Avenatti Charged in California With US Fraud, Tax Crimes

Last month, Michael Avenatti was arrested on several charges that included bank and mail fraud as well as allegedly trying to extort Nike for over $20 million, and now the celebrity attorney has just been hit with a new 36 count indictment for separate criminal complaints.

Avenatti allegedly tried to hide the scheme by derailing the client's attempt to buy a house and lying to the Social Security Administration about the settlement, resulting in the client losing his Social Security benefits in February, according to the indictment.

A hearing was set for 9 a.m. PDT Thursday, when federal prosecutors will release more information in the case.

The Los Angeles Times reported that Johnson is the paraplegic man whom he allegedly withheld the multimillion-dollar settlement from.

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.

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

" 'There have been collection efforts going on for many, many years, ' said Nick Hanna, the US attorney in Los Angeles".

Avenatti, who is free on a $300,000 bond, tweeted Thursday morning that he'd made many powerful enemies over the last two decades.

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Hanna said the Avenatti case "has nothing to do with anything political or with anything else". An indictment in that case is expected soon.

The indictments include the two charges filed against him in March, including allegations that Avenatti submitted fake financial information to a MS bank in order to get three loans worth $4.1 million.

Prosecutors also charged Avenatti with giving false testimony in a case involving the bankruptcy of his law firm Eagan Avenatti LLP.

Under State Bar of California rules of professional conduct, a lawyer must promptly notify a client of the receipt of any funds they are entrusted to hold for the client and turn over the money at the client's request.

The indictment came about three weeks after Avenatti, who gained national fame for representing adult film star Stormy Daniels in her litigation against Trump, was arrested in NY on separate criminal complaints filed by federal prosecutors in NY and California. Avenatti was also accused of using fraudulent tax returns to secure a bank loan.

The 61-page indictment claims Avenatti stole millions of dollars from five clients and used a number of shell companies and bank accounts to cover up the theft. But when Johnson was in escrow to purchase the property, Avenatti falsely said he had not received the settlement funds, the indictment said. After the IRS sought those unpaid taxes through a lien and levy notices to financial institutions that did business with the coffee company, Avenatti lied to IRS officials about his involvement in the chain's finances, the indictment says.

Listen to the Guys Who Law talk about Avenatti's troubles below!

In addition to Client 1, Hanna said, Avenatti followed a similar pattern with four other clients.

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