Avenatti pleads not guilty to federal charges of cheating, lying

SANTA ANA, Calif. (AP) - Attorney Michael Avenatti just appeared before a federal judge in Santa Ana, where he pleaded not guilty to federal charges of embezzling millions of dollars from a mentally ill paraplegic and other clients, hiding assets from a bankruptcy court and failing to pay taxes.

Avenatti was represented by a public defender at his arraignment on a 36-count indictment -- returned by a Santa Ana grand jury and unsealed April 11 -- that expanded previous bank and wire fraud charges alleging he embezzled a $1.6 million settlement from a client's trust account and provided false tax records to obtain $4.1 million in business loans from a bank in Mississippi.

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Avenatti embezzled settlement funds and proceeds from other matters he handled for five clients and doled out small portions, sometimes labeling them as advances to prevent thefts from being discovered, prosecutors have said.

Avenatti, 48, has denied the charges, saying he had made powerful enemies and pleaded not guilty.

"The right to a presumption of innocence and the right to a jury trial are two fundamental rights that our founding fathers demanded when this country was formed over 200 years ago," he said in a statement Monday.

Avenatti was arrested in March in New York on a separate case alleging he demanded millions to stay quiet about claims he planned to reveal about Nike paying high school athletes. He has denied wrongdoing in that case as well.

The charges are the latest blow to a legal career that took off when Avenatti represented Daniels in her lawsuit to break a confidentiality agreement with Trump to stay mum about an affair they allegedly had.

Avenatti became one of Trump's leading adversaries, attacking him on cable news programs and Twitter. At one point, Avenatti considered challenging Trump in the 2020 elections.