- Attorney Michael Avenatti has been arrested in California and could face additional money laundering and fraud charges while awaiting three separate federal criminal trials on charges of financial fraud and extortion.
- Citing federal court documents, the Los Angeles Times reported on January 15 that the alleged pretrial violations included laundering money to fraudulently conceal $US1 million from his ex-wife.
- Avenatti is currently awaiting trial in three criminal cases based out of New York and California, including his alleged extortion of Nike.
- Federal prosecutors told the Los Angeles Times that they are looking to revoke Avenatti’s bail as he remains in custody in California.
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Attorney Michael Avenatti has been arrested in California and could face additional money laundering and fraud charges while awaiting three separate federal criminal trials on charges of financial fraud and extortion.
On January 14, federal prosecutors in California announced that IRS agents had arrested Avenatti for violating the conditions of his pre-trial release, but did not specify what those violations entailed. Avenatti was arrested while attending a hearing in which the California State Bar sought to disbar him while awaiting trial.
Citing federal court documents, the Los Angeles Times reported on January 15 that the alleged pretrial violations included laundering money to fraudulently conceal $US1 million from his ex-wife and others to whom he owed debts after his initial arrest in March of 2019.
Avenatti, a former high-profile celebrity lawyer who most famously represented porn star Stormy Daniels in her legal disputes against President Donald Trump, saw a stunning fall from grace in 2019 as his legal problems mounted.
On March 25, 2019, New York federal prosecutors charged Avenatti with attempting to extort more than $US20 million from Nike, alleging he tried to get the money by “threatening to use his ability to garner publicity to inflict substantial financial & reputational harm on the company if his demands were not met.”
Prosecutors alleged that Avenatti threatened to publicly accuse Nike of participating in a college basketball bribery scheme unless they spent a hefty amount of money to hire him and another attorney to conduct an internal investigation of Nike, or settle with their client.
A few weeks later in April of 2019, Avenatti was charged by a grand jury in the Central District of California on a slew of financial crimes in a blockbuster 36-count indictment, including 10 counts of wire fraud related to the alleged embezzlement of his clients’ money, 19 counts of tax fraud, four counts of bankruptcy fraud, and two counts of bank fraud.
Then, in late May of 2019, federal prosecutors in New York further charged Avenatti with identity theft and defrauding his famous client Stormy Daniels out of $US300,000. He has pleaded not guilty to all the charges.
In Wednesday’s court filing, prosecutors allege that Avenatti used a complex web of bank accounts to conceal money in order to avoid paying court-ordered judgments to his ex-wife and former law partner and used the money to pay his rent, legal fees, and purchase a new car, among other things.
The motion says DOJ has probable cause to believe Avenatti committed mail fraud, wire fraud, and structuring to evade reporting
He's alleged to have removed/concealed/disposed of money and personal property to avoid it being seized to pay judgments pic.twitter.com/TEgIys7Ozp
— Owen Barcala (@obarcala) January 15, 2020
In all, prosecutors estimated that Avenatti owes $US21 million in debt to his creditors.
On Wednesday afternoon, a federal judge revoked Avenatti’s bail and ordered him to be transported from California to New York on Friday, where he will face trial on the Nike extortion charges beginning on January 21.
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