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Avenatti, lawyer known as Trump foe, indicted for financial crimes

Avenatti, lawyer known as Trump foe, indicted for financial crimes
FILE PHOTO: Lawyer Michael Avenatti in New York, New York, U.S., March 25, 2019. REUTERS/Carlo Allegri/File Photo   -   Copyright  Carlo Allegri(Reuters)
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(Reuters) – Michael Avenatti, the high-profile lawyer known for his battles with U.S. President Donald Trump, was charged with 36 counts of fraud, tax evasion and other financial crimes in an indictment made public by federal prosecutors in Los Angeles on Thursday.

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 New York on two separate criminal complaints filed by federal prosecutors in New York and California.

The indictment means the grand jury has found the California prosecutors have probable cause to pursue their charges. Avenatti, 48, has said he is innocent.

“I intend to fully fight all charges and plead NOTGUILTY,” Avenatti wrote on Twitter on Thursday. “I look forward to the entire truth being known as opposed to a one-sided version meant to sideline me.”

The Los Angeles prosecutors have accused Avenatti of misusing a client’s $1.6 million settlement to pay for his own expenses as well as those for his coffee business. They also say he defrauded a Mississippi bank of $4.1 million (3.13 million pounds) in loans by submitting false tax returns for 2011 to 2013 that inflated his income.

The New York prosecutors have separately accused Avenatti of trying to blackmail Nike Inc for more than $20 million.

They said Avenatti and a co-conspirator, who they did not name, met with Nike’s attorneys on March 19 and told them they represented a former college basketball coach with information about Nike’s involvement in a scheme to bribe high school basketball players.

They threatened to go public unless Nike hired Avenatti to conduct an internal investigation for $15 million to $25 million, and paid an additional $1.5 million to the client, according to prosecutors. Avenatti also offered to accept a $22.5 million payment for his silence, prosecutors said.

The alleged co-conspirator is prominent Los Angeles attorney Mark Geragos, according to a person familiar with the matter who spoke on condition of anonymity. Geragos, who has not been charged with a crime, has declined to comment on the case.

Avenatti became a prominent critic of Trump and a frequent cable TV guest while representing Daniels, whose real name is Stephanie Clifford. She filed a lawsuit against the president over a nondisclosure agreement that in the weeks before the 2016 U.S. presidential election kept her from discussing her claims that they had an extramarital affair 10 years earlier.

Daniels replaced Avenatti as her lawyer last month, and has said she was “saddened but not shocked” by his arrest.

Avenatti also involved himself in the investigation of sexual abuse charges against R&B singer R. Kelly by giving the Chicago state’s attorney’s office what he said was a tape of the performer having sex with an underage girl.

(Reporting by Jonathan Allen, Brendan Pierson, Gina Cherelus and Daniel Wallis; editing by Jonathan Oatis)

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