Updated: 1:49 PM ET, Thu April 11, 2019
In Los Angeles, a federal grand jury indicted Michael Avenatti -a celebrity attorney who is facing criminal charges- on a total of 36 counts which included wire fraud, embezzlement, tax evasion and bank fraud which are all connected to his alleged theft of tens of millions of dollars.
At the beginning of 2015, Avenatti executed a scheme to defraud five clients, according to the indictment, one of which was a paraplegic. Avenatti withheld a settlement payment of $4 million from the client.
After stealing the client’s $4 million settlement, Avenatti then directed a small portion of what the client was owed, $124,000, to be paid to the client while sending some payments to assisted living facilities to cover the client’s rent. However, Avenatti lied to the client and told them that the settlement had already been paid.
As a result, that client was unable to purchase the property they were wanting. Additionally, the client was also denied benefits from social security when Avenatti failed to respond to the administration on behalf of the client, afraid that the disclosure of information that the administration sought would expose his scheme.
After negotiating settlements for each of the clients – that required payment to go to them -, Avenatti would lie to them about the terms of the agreement. Avenatti would instead deposit the funds to different attorney trust accounts he controlled, the indictment mentions. From there, he would then embezzle and steal those funds. To prevent his scheme from getting caught, he told his clients the settlement proceeds have not yet been paid, using other sorts of tactics to deceive them.
The indictment also accuses Avenatti of not filing multiple individual income tax returns, claiming that the last return he filed was with the IRS back in 2010.
On Thursday, Avenatti took to Twitter to tweet out after the indictment was announced: “For 20 years, I have represented Davids vs. Goliaths and relied on due process and our system of justice. Along the way, I have made many powerful enemies. I am entitled to a FULL presumption of innocence and am confident that justice will be done once ALL of the facts are known.”
