Atty Michael Avenatti Indicted on 36 Counts Including Bank Fraud, Tax Fraud & Embezzlement - The Jewish Voice
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Thursday, September 28, 2023

Atty Michael Avenatti Indicted on 36 Counts Including Bank Fraud, Tax Fraud & Embezzlement

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A grand jury sitting in California indicted famed attorney Michael Avenatti on 36 additional criminal counts on Thursday, including bank fraud, tax evasion, wire fraud, embezzlement, and more.

By: Harry Cherry

Just two weeks ago, Mr. Avenatti in two separate cases, one in New York and another in California, on charges including extortion, bank fraud, and wire fraud. Federal prosecutors alleged that Mr. Avenatti attempted to extort Nike for $20,000,000.

“These four areas of criminal conduct alleged in the indictment are all linked to one another because money generated from one set of crimes appears in other sets – typically in the form of payments to lull victims and to prevent Mr. Avenatti’s financial house of cards from collapsing,” Nick Hanna, the United States Attorney for the Central District of California said Thursday in a statement.

“The financial investigation conducted by the IRS details a man who allegedly failed to meet his obligations to the government, stole from his clients, and used his ill-gotten gains to support his racing team, the ownership of Tully’s coffee shops, and a private jet,” IRS Acting Special Agent in Charge Ryan Korner said Thursday at a press conference. “Individuals who intentionally thwart the IRS and fail to meet their tax obligations will be caught and they will be held accountable.”

“In each of the four cases of embezzlement alleged in the indictment, Avenatti received money on behalf of clients into client trust accounts, misappropriated the money, and lied to the clients about receiving the money or, in one case, claimed that the money had already been sent to the client,” prosecutors said Thursday in a statement.

Mr. Hanna added on Thursday that federal agents seized a jet belonging to Mr. Avenatti, which was purchased with funds that he alleged were stolen from a client. The indictment alleges that Mr. Avenatti hid a $4,000,000 settlement from a paraplegic client — and used the funds from that settlement to run a coffee shop and fund his luxurious lifestyle.

Mr. Avenatti’s former coffee business, Global Baristas US LLC, did not file employment tax returns and was responsible for $3.2 million in federal payroll taxes, the indictment alleges. Mr. Avenatti made false statements or lied to an IRS officer, opened a bank account to transfer and hide funds from credit card purchases made by consumers at his coffee shop, and told employees to despite cash from the coffee shop into a bank account which belonged to a car racing business also ran by Mr. Avenatti.

Prosecutors say that Mr. Avenatti could face a maximum of 333 years in federal prison if convicted on all charges against him.

Mr. Avenatti is scheduled to be arraigned on Apr. 29 at the U.S. District Court in Santa Ana, California.

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