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After celebrity attorney Michael Avenatti was arrested on fraud and extortion charges, details have emerged about the allegations against him, which include claims that he defrauded a bank and attempted to extort Nike for millions of dollars.
Federal prosecutors allege that Avenatti, 48, approached Nike with threats to expose misconduct within the company, the Associated Press reports. Avenatti, who prosecutors say was representing the coach of an Amateur Athletic Union basketball program with a Nike sponsorship, allegedly threatened to publicly reveal the alleged wrongdoing and schedule it to coincide with two big events for the company: their quarterly earnings call and the beginning of the NCAA tournament.
Avenatti then allegedly presented the company with two options: they could pay him between $15 and $25 million to investigate his client’s allegations, or he would agree to keep quiet about the matter for $22 million, according to a criminal complaint obtained by the Associated Press.
Prosecutors also allege that Avenatti worked with a co-conspirator, identified by anonymous sources close to the case as Mark Geragos, an attorney who’s worked with celebrities like Michael Jackson and, most recently, Jussie Smollett, the Associated Press reports. Geragos did not respond to the AP’s request for comment.
In relation to the alleged Nike extortion attempt, Avenatti faces up to 47 years in prison on charges of conspiracy to transmit interstate communications with intent to extort, conspiracy to commit extortion, transmission of interstate communications with intent to extort, and extortion, according to the Associated Press.
Avenatti appeared in court in New York on Monday, where did not yet enter a plea in response to the charges but did secure his release from jail on a $300,000 bond. He denied the claims against him during a press conference, stating his belief that he will be “fully exonerated.”
“For the entirety of my career, I have fought against the powerful,” he said. “Powerful people and powerful corporations. I will never stop fighting that good fight. I am highly confident that when all the evidence is laid bare in connection with these cases, when it is all known, when due process occurs, that I will be fully exonerated and justice will be done.”
He echoed those sentiments on Twitter, taking aim at Nike in a series of tweets accusing the company of attempting to “divert attention from their own crimes,” a move that he believes will “fail miserably.”
However, Avenatti’s problems don’t end there. In a separate case, Avenatti is facing another possible 50-year prison sentence after prosecutors in California accused him of obtaining bank loans totaling more than $4 million by filing false tax returns to make it appear as if he’d been earning more money than he actually had been, the Los Angeles Times reports. Prosecutors say that Avenatti provided the bank with fake tax returns suggesting that he brought in $14 million in earnings over a three-year period, when in reality he did not file tax returns at all during that period, according to the outlet.
Avenatti, who allegedly still owes the IRS more than $850,000 in unpaid taxes, used the ill-gotten funds to support his law firm and coffee business, prosecutors claim, according to the Times.
The celeb attorney has also been charged with wire fraud in relation to claims that he embezzled money from a client to the tune of $1.6 million, settlement money prosecutors say Avenatti was supposed to hold for the client but instead spent himself, the Los Angeles Times reports.
Avenatti had grown prominent in recent years, having made a name for himself representing adult film actress Stormy Daniels in her legal battle to invalidate a nondisclosure agreement so that she could speak about the alleged affair she had with Donald Trump. More recently, Avenatti has been representing a number of women who have accused disgraced R&B singer R. Kelly of sexual misconduct. He has supplied prosecutors with two video tapes that he says show Kelly sexually assaulting an underage girl (celeb attorney Gloria Allred has handed in a third).
Daniels, whose real name is Stephanie Clifford, commented on the recent news about Avenatti, saying Monday that the allegations left her feeling “saddened but not shocked.”
“I made the decision more than a month ago to terminate Michael’s services after discovering that he had dealt with me extremely dishonestly and there will be more announcements to come,” she wrote on Twitter.
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