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Michael Avenatti Stole From Stormy Daniels: Feds

Federal prosecutors charged the embattled lawyer with identity theft and fraud for allegedly stealing Stormy Daniels’ book advance and using the money for himself.

Kate Briquelet5.22.19 1:22 PM ET

Embattled lawyer Michael Avenatti has been charged with fraud and aggravated identity theft for allegedly snatching a total of $300,000 from Stormy Daniels and spending it on personal expenses like airfare, hotels, and restaurant delivery, and to bankroll his law firm.

Federal prosecutors in New York announced the latest charges against the Newport Beach litigator soon after ABC News reported Avenatti was expected to be charged with additional financial crimes. The 48-year-old lawyer faces a slew of charges on both coasts, including wire fraud, bank fraud, and extortion.

The U.S. Attorney’s Office for the Southern District of New York has already charged Avenatti with attempting to extort Nike to the tune of $25 million, and the Daniels charges are separate from that case.

“Michael Avenatti abused and violated the core duty of an attorney—the duty to his client,” Manhattan U.S. Attorney Geoffrey S. Berman said in a statement. “As alleged, he used his position of trust to steal an advance on the client’s book deal. As alleged, he blatantly lied to and stole from his client to maintain his extravagant lifestyle, including to pay for, among other things, a monthly car payment on a Ferrari. Far from zealously representing his client, Avenatti, as alleged, instead engaged in outright deception and theft, victimizing rather than advocating for his client.”

Avenatti denied the latest allegations.

“No monies relating to Ms. Daniels were ever misappropriated or mishandled,” Avenatti tweeted on Wednesday. “She received millions of dollars worth of legal services and we spent huge sums in expenses. She directly paid only $100.00 for all that she received. I look forward to a jury hearing the evidence.”

“At no time was any money misappropriated or mishandled,” he wrote in a subsequent tweet. “I will be fully exonerated once the relevant emails, contracts, text messages, and documents are presented.”

According to the indictment, Avenatti “stole a significant portion” of Daniels’ advance on her book contract by forging her signature on a letter to her literary agent, asking the agent to send payments to a bank account Avenatti controlled.

Once Avenatti received the money, prosecutors allege, he used it to pay employees of his law firm and his defunct coffee company, Global Baristas. Some of the funds owed to Daniels—who is identified as “Victim-1” in the court filing—also went to a luxury car payment and to Avenatti’s dry cleaning.

“When [Daniels] inquired about the status of [her] advance fees, Avenatti repeatedly lied to [her], including by stating that he was working on getting fees from [her] publisher, when, in truth and in fact, Avenatti had already received the fees and spent them on his own personal and professional expenses,” the indictment states.

Prosecutors say Avenatti stole approximately $300,000 from Daniels and has not repaid her half of that money.

On Tuesday, Avenatti told warned the Twitterverse he expected another indictment.

“I expect an indictment to issue from SDNY in the next 48 hrs charging me in connection with my arrest in March. I intend on fighting these bogus/legally baseless allegations, and will plead not guilty to ALL CHARGES. I look forward to the trial where I can begin to clear my name.”

The news follows a Vanity Fair profile on Avenatti’s fall from media darling and self-styled presidential candidate to a disgraced lawyer accused of stealing client funds.

Avenatti told the magazine he saw an “opportunity” in Daniels’ case against Trump.

“When I met with Stormy, I saw an avenue by which I could do collateral damage to Donald Trump and those around him for what appeared to me to be illegal conduct and rigging a presidential election,” Avenatti said in the interview. “I saw that as an opportunity to do something that was just, that was right, and to basically go all in.”

In November, Daniels told The Daily Beast that Avenatti had ignored her requests for a financial accounting of her legal fund—and that he launched a second crowdfunding website without telling her.

It’s unclear whether the new charges are related to the fundraising effort.

“For months I’ve asked Michael Avenatti to give me accounting information about the fund my supporters so generously donated to for my safety and legal defense,” Daniels said in a statement in November. “He has repeatedly ignored those requests. Days ago I demanded again, repeatedly, that he tell me how the money was being spent and how much was left. Instead of answering me, without my permission or even my knowledge Michael launched another crowdfunding campaign to raise money on my behalf. I learned about it on Twitter.”

In response, Avenatti denied keeping the accounting from Daniels.

“I have always been an open book with Stormy as to all aspects of her cases and she knows that,” Avenatti said in a statement of his own. “The retention agreement Stormy signed back in February provided that she would pay me $100.00 and that any and all other monies raised via a legal fund would go toward my legal fees and costs. Instead, the vast majority of the money raised has gone toward her security expenses and similar other expenses. The most recent campaign was simply a refresh of the prior campaign, designed to help defray some of Stormy’s expenses.”