Celebrity lawyer Michael Avenatti is standing trial in Manhattan on Monday over allegations that he embezzled nearly $300,000 from his famed former client, pornographic actress Stormy Daniels, whom he represented in 2018 in lawsuits dealing with the Trump campaign’s efforts to cover up the candidate’s previous sexual encounter with Daniels.
Prosecutors claim that Avenatti, who helped secure the $800,000 advance for Daniels’s book Full Disclosure, committed wire fraud and aggravated identify theft when he had $300,000 of this sum funneled to his account under false pretense of authorization from Daniels. Avenatti allegedly forged Daniels’ signature on a letter posing as her permission to wire the funds, according to the indictment.
When Daniels asked where the first advance installments went, Avenatti allegedly lied and told her the publisher had not made the payments yet. The prosecution claims that the attorney used the money to cover his professional and personal expenses.
For the next several months, Avenatti allegedly doubled down on the story he had fed Daniels, that the publisher had not initiated the payments, until she communicated with the firm directly and exposed the alleged lie.
“This is a case about a lawyer who stole from his client. A lawyer who lied to cover up the scheme,” Assistant U.S. Attorney Andrew Rohrbach said before the Manhattan court Monday. “The defendant stole almost $300,000 from the person he was supposed to be looking out for.”
The defense asserted that Avenatti is innocent of theft and that the adult-film star owes her success and wealth to his work on her book deal. Avenatti has pleaded not-guilty to the charges against him.
In his opening statement, defense attorney Andrew Dalack argued that Avenatti had claim to some of Daniels’ book revenues and that he was authorized to handle receipt of payments on her behalf. Rohrbach countered that Avenatti and Daniels had not agreed to this arrangement, however.
“This has no business in federal criminal court,” Dalack said. “What we have in this case is a disagreement, a fee dispute between an attorney and his disgruntled former client.”
Dalack said Avenatti had also “transformed a rather obscure adult entertainer into a household name” and provided her with her lucrative career opportunities.
In 2018, Avenatti represented Daniels in the hush-money scandal in which she was compensated $130,000 in campaign funds ahead of the 2016 election in exchange for her silence on a previous sexual encounter with Trump. Michael Cohen, Trump’s former personal attorney, was ultimately charged with campaign finance violations for sending the “hush money” to Trump’s accusers to protect the presidential candidate from bad press during the race.