Michael Avenatti’s Spectacular Fall Continues; Legal Woes Pile Up
by: The Knowledge Group
Michael Avenatti once wanted to run for president. Now, the outspoken California lawyer faces dozens of charges, after an indictment accusing him of stealing clients’ money and spending it on a private jet, his own legal expenses, and a coffee company he owned. Avenatti stands accused not only of misappropriating clients’ money but also of misleading bank officers about his income in order to get approvals on more than $4.1 million in loans for his companies.
He must answer new charges against him on April 29 in California, after a federal grand jury in Santa Ana produced charges including a host of financial crimes, including bankruptcy fraud, perjury, failure to pay taxes, and embezzlement.
The new charges add to the wire fraud, bank fraud, and extortion charges filed against Avenatti last month in New York and California.
In New York, Michael Avenatti was accused of pressuring Nike’s lawyers for a payoff, lest he reveals that the corporation made improper payments to college basketball recruits. Avenatti threatened to reveal damning information about Nike just before the NCAA college basketball tournament, and demanded that the company pay his client $1.5 million.
He further insisted the company should hire Avenatti and another attorney for a total of $35 million to investigate the company’s conduct.
Prosecutors say Avenatti has lied to the IRS about tax debts for years.
Michael Avenatti has used multiple bank accounts and shell companies to hide evidence, prosecutors allege. They accuse him of steering nearly $5 million in payroll taxes and penalties away from the IRS by moving money associated with the coffee company into his car-racing company.
After winning large settlements for other clients, Avenatti allegedly concealed the offers and fabricated their terms to the clients. One of Avenatti’s five defrauded clients is a paraplegic who won a $4 million settlement but has received only a small fraction from Avenatti, and has since become destitute.
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