Michael Avenatti gives up control of firm after being accused of hiding millions: report

Michael Avenatti agreed Wednesday to give up financial control of his law firm to settle a dispute with a former partner who claimed the celebrity lawyer hid millions in order to fund his lavish lifestyle and avoid having to pay a $10 million judgment.

Jason Frank, a former partner at Eagan Avenatti, accused Avenatti in a court filing of spending extravagantly: $13,000 in rent for his Los Angeles apartment; a $3,640 payment on his Ferrari; $150,000 for his coffee company; $53,600 on his ex-wife; and $232,875 for his auto racing team, The Los Angeles Times reported.

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Frank also claimed that Avenatti hid millions in legal fees from creditors during bankruptcy proceedings and asked the court to appoint a receiver to take possession of the firm’s bank accounts, computers and other assets.

Avenatti, whose client list included porn actress Stormy Daniels, denied any wrongdoing, calling Frank’s claims “much to-do about nothing” and that “every dollar has been properly accounted for and reported as required and as previously set forth in numerous accountings.”

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He will still act as the lead lawyer in his new firm, Avenatti & Associates.