A former client of celebrity lawyer Michael Avenatti has accused him of running his law firm like a “Ponzi scheme,” pocketing the client’s money and offering to lend it to him at high interest.
Gregory Barela alleges Avenatti secured him a settlement and never gave him the money, but instead offered to lend it to him at 10 percent interest. “Avenatti was operating his law firm in a Ponzi scheme like manner, taking settlement proceeds received for clients to pay off debts, pay the other individual Defendants’ salaries and bonuses, and fund his lavish lifestyle, while telling clients that the settlement proceeds had not been received or would be received at a later date,” says Barela.