Celebrity attorney Michael Avenatti speaks to the media outside of a New York court house after a hearing in a case where he is accused of stealing $300,000 from a former client, adult-film actress Stormy Daniels on July 23, 2019 in New York City.
Spencer Platt | Getty Images
Michael Avenatti, the controversial lawyer facing criminal charges in three separate serious federal cases, was arrested by federal agents in California on Tuesday for allegedly violating the terms of his bail release in one of those cases.
Avenatti, who is accused of swindling clients including porn star Stormy Daniels out of millions of dollars, was taken into custody during a break in a disciplinary hearing of the State Bar of California in Los Angeles.
That oversight group was seeking to place Avenatti on “involuntary active status” in response to a claim of swindling one client out of more than $800,000.
A spokesman for the U.S. Attorney’s Office in Los Angeles, Ciaran McEvoy, told CNBC that Avenatti was arrested by IRS agents from that agency’s criminal investigation division. The IRS is the lead investigative agency in the prosecution of Avenatti in California.
McEvoy said that warrant, which would outline how Avenatti allegedly violated his release conditions, is sealed, so he was unable to reveal the claims.
Under the terms of Avenatti’s bail, his travel had been restricted to and from certain areas of California, New York state and Florida. He had been free on a personal recognizance bond of $300,000, which did not require him to post any money or assets to secure.
Avenatti is scheduled to be presented on the bail violation claim Wednesday in federal court in Santa Ana, California. Avenatti is due to go on trial next week in federal court in New York City in another case.
“Completely innocent,” Avenatti said outside the court after his arrest, according to The Daily Beast, which had a reporter at the bar hearing.
Avenatti has pleaded not guilty to all criminal charges against him.
He is due to go on trial this month in U.S. District Court in Manhattan in a case in which he is accused of trying to extort more than $20 million from athletic apparel giant Nike by threatening to expose alleged evidence of bribing amateur basketball players and their families unless the company paid up.
Hours before his arrest Tuesday, Avenatti was on a telephone conference call with his lawyers, prosecutors and reporters as a judge heard arguments to postpone that trial by a month to give his defense team more time to digest thousands of pages of documents recently turned over by prosecutors. The judge declined to delay the trial.
He separately is charged in the same court in another case with scamming Daniels out of hundreds of thousands of dollars in proceeds of a book deal.
Avenatti had gained national notoriety in 2018 for his representation of Daniels in her claims of having a sexual tryst with President Donald Trump a decade earlier, and in connection with her having received hush money from Trump’s then-personal lawyer and fixer Michael Cohen shortly before the 2016 presidential election.
Trump denies having had sex with Daniels, but reimbursed Cohen for the $130,000 that was paid to the adult film actress.
In the California case, Avenatti is charged in a 36-count indictment accusing him of tax crimes, wire fraud and perjury.
IRS investigators alleged that Avenatti had stolen money through a “tangled financial web of lies” and used it “to fund a lavish lifestyle which had no limits.”
Prosecutors claim that Avenatti hid and then spent a $4 million legal settlement obtained in January 2015 in favor of a mentally ill paraplegic client, and hid a $2.75 million settlement for another client that Avenatti allegedly used to help pay for his share of the purchase of a private jet valued at up to $5 million.