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Former Stormy Daniels attorney Michael Avenatti indicted for financial crimes

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Former Stormy Daniels attorney Michael Avenatti indicted for financial crimes

(Reuters) – Michael Avenatti, a high-profile lawyer and critic of President Donald Trump, was indicted on charges of defrauding clients and the U.S. government out of millions of dollars, including allegations he embezzled from a paraplegic man, prosecutors announced 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 meant the grand jury, which voted to indict Avenatti late on Wednesday, had found the California prosecutors had probable cause to pursue their charges.

Avenatti, 48, has said he planned to fight all the charges and plead not guilty.

“I look forward to the entire truth being known as opposed to a one-sided version meant to sideline me,” Avenatti, who is free on a $300,000 bond, wrote on Twitter on Thursday. “Any claim that any monies due clients were mishandled is bogus nonsense.”

Prosecutors in the office of the U.S. Attorney for California’s Central District have charged Avenatti with 10 counts of wire fraud, accusing him of misusing more than $12 million he received on behalf of clients following settlements and other negotiations.

“Money generated from one set of crimes was used to further other crimes, typically in the form of payments designed to string along victims so as to prevent Mr. Avenatti’s financial house of cards from collapsing,” Nicola Hanna, the U.S. attorney for California’s Central District, said at a news conference in Los Angeles on Thursday.

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

Prosecutors say Avenatti misled clients and misused their funds to pay personal and legal expenses, to finance a coffee shop business he also ran and to pay for his share of a Honda private jet, according to the indictment. Federal authorities seized the jet on Wednesday, prosecutors said.

One of the clients included a man who won a $4 million settlement in 2015 from Los Angeles County after he became paraplegic in an unspecified incident, prosecutors said. Avenatti concealed the settlement from the client, instead giving the man periodic advances of $1,900 and paying the rent in his assisted living facility, the indictment said.

The indictment also accuses Avenatti of various tax crimes. He is accused of failing to file personal tax returns since 2010, and to pay $3.2 million in payroll taxes on his coffee business, even though he withheld some portion of this money from employee paychecks.

The indictment also said he defrauded a Mississippi bank of $4.1 million in loans by submitting false tax returns for 2011 to 2013 that inflated his income.

The most serious bank fraud charges carry a maximum sentence of 30 years per count, prosecutors said. Federal sentencing guidelines typically call for defendants to serve less than the maximum time.

NIKE SCHEME

The New York prosecutors have separately accused Avenatti of trying to blackmail athletic wear maker 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.

FILE PHOTO: Lawyer Michael Avenatti in New York, New York, U.S., March 25, 2019. REUTERS/Carlo Allegri/File Photo

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.

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, Gabriella Borter and Daniel Wallis; editing by Frank McGurty and Jonathan Oatis

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Politics

Trump sues to block Democrats’ subpoena for financial information

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Republican convention set for August 2020 in Charlotte

Lawyers for President Trump on Monday sued to block a subpoena issued by members of Congress that sought the business magnate’s financial records.

The complaint named Rep. Elijah Cummings, the Democratic chairman of the House Committee on Oversight and Reform, and Peter Kenny, the chief investigative counsel of the House committee, as its plaintiffs.

“We will not allow Congressional Presidential harassment to go unanswered,” said Jay Sekulow, counsel to the president.

This is a breaking news story. Check back for updates.

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Congressman Moulton enters Democratic 2020 presidential race

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Congressman Moulton enters Democratic 2020 presidential race

WASHINGTON (Reuters) – U.S. Representative Seth Moulton entered the 2020 Democratic presidential race on Monday as a long-shot contender in a contest that now includes almost 20 candidates.

FILE PHOTO: U.S. Congressman Seth Moulton (D-MA) speaks at a Merrimack County Democrats Summer Social at the Swett home in Bow, New Hampshire, U.S., July 28, 2018. REUTERS/Brian Snyder/File Photo

A 40-year-old Iraq War veteran who represents a district in Massachusetts, Moulton enters the race as an underdog, with little national name recognition and a shorter track record than some rivals who have spent years in the U.S. Senate or as state governors.

Moulton has built a political career by challenging the party’s establishment. He entered Congress in 2015 after winning a Democratic primary challenge against John Tierney, who had held the seat for 18 years.

After Democrats took control of the U.S. House of Representatives in 2018, Moulton helped organize opposition to Representative Nancy Pelosi’s bid to again become Speaker of the House.

He ended his opposition to Pelosi with a statement saying: “Tough conversations make us stronger, not weaker, and we need to keep having them if we’re going to deliver on the change that we’ve promised the American people.”

In a YouTube video announcing his presidential candidacy, he said: “Decades of division and corruption have broken our democracy and robbed Americans of their voice.”

“While our country marches forward, Washington is anchored in the past,” he said.

In the video, Moulton said he wants to tackle climate change and grow the U.S. economy by promoting green jobs as well as high tech and advanced manufacturing.

Moulton served in the Marines from 2001 to 2008. During his 2014 congressional bid, he became a vocal critic of the Iraq War in which he served, saying no more troops should be deployed to the country.

He has advocated stricter gun laws, saying military-style weapons should not be owned by civilians.

Moulton supports the legalization of marijuana and told Boston public radio station WGBH in 2016 that he had smoked pot while in college.

He graduated from Harvard University with an undergraduate degree in physics in 2001 and returned to receive a master’s degree in business and public policy in 2011.

For a graphic of the 2020 presidential candidates, see: tmsnrt.rs/2Ff62ZC

Reporting by Ginger Gibson; additional reporting by Rich McKay; Editing by Colleen Jenkins, Jonathan Oatis, Kirsten Donovan and David Gregorio

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Trump sues to block subpoena for financial information

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Trump sues to block subpoena for financial information

U.S. President Donald Trump boards Air Force One as they travel to Florida for Easter weekend, at Joint Base Andrews in Maryland, U.S., April 18, 2019. REUTERS/Al Drago

WASHINGTON (Reuters) – U.S. President Donald Trump on Monday sued to block a subpoena issued by the Democratic chairman of the U.S. House Oversight Committee that sought information about his and his businesses’ finances.

“Chairman Cummings’ subpoena is invalid and unenforceable because it has no legitimate legislative purpose,” lawyers for Trump and the Trump Organization said in court filing.

Reporting by Makini Brice; Editing by Tim Ahmann

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