DEVELOPING: IRS, DOJ to File 36-Count Indictment Against Michael Avenatti

Celebrity lawyer Michael Avenatti arrives for his first hearing in Santa Ana federal court on bank and wire fraud charges

Prosecutors on Thursday said Avenatti, the lawyer who represented Stormy Daniels in her lawsuit against President Trump, had been hit with these charges in connected to alleged wire, tax, bank, and bankruptcy fraud.

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

U.S. Attorney Nick Hanna said all Avenatti's crime are "linked to one another because money generated from one set of crimes appears in other sets", as payments to "lull victims and to prevent [his] financial house of cards from collapsing".

According to court documents, prosecutors say Avenatti would occasionally send Client 1 "advance" payments that didn't exceed $1,900.

A jet co-owned by Avenatti was seized Wednesday as part of the ongoing investigation, officials said.

That same day in Los Angeles, prosecutors claimed that Avenatti misused a client settlements to fund his coffee business, and also used the money to pay personal expenses.

The indictment said Avenatti made false statements in bankruptcy proceedings by submitting forms under penalty of perjury that under reported income his firm received.

In the Johnson theft, the indictment alleges, Avenatti received $4 million from Los Angeles County in 2015 to settle the paraplegic's suit over his treatment at the Twin Towers Correctional Facility.

The indictment is consistent with The Daily Caller News Foundation's previous reporting on Avenatti's management of Tully's coffee chain. He also allegedly undermined his paraplegic client's attempt to buy a house and jeopardized his Social Security payments by failing to file paperwork. Along the way, I have made many powerful enemies.

"Any claim that any monies due clients were mishandled is bogus nonsense".

Avenatti also disputed Nike's claim that it's been cooperating with a probe into corruption in college basketball, as Nike said after Avenatti was arrested outside the company's law firm. He responded "no" when he was asked whether Eagan Avenatti had received legal fees when it was representing ticket holders who sued the National Football League over seating snafus at the 2011 Super Bowl in Texas. He was charged in a criminal complaint in Santa Ana, California, on March 25 for stealing a different client's $1.6 million settlement to cover his own expenses, as well as cheating a MS bank.

Lawyers for Avenatti did not immediately return calls for comment on the statement. One of his businesses, Global Baristas US LLC, failed to file employment tax returns and didn't pay $3.2 million in federal payroll taxes, which had been withheld from employee paychecks.

According to the indictment, Avenatti withheld Tully's employment taxes from the IRS, and directed employees to deposit cash receipts into an account for Avenatti's auto racing company.

Avenatti's tweet Thursday included a "client testimonial" bearing a signature purportedly from Johnson that said Avenatti is "an exceptional, honest and ethical attorney and I feel fortunate to have had him represent me".

In a tweet, Avenatti said he intends "to fully fight all charges and plead NOT GUILTY". Trump has denied having an affair with Daniels.

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