Michael Avenatti stole $300,000 from Stormy Daniels and lied to her about where the money was, prosecutors say

• Prosecutors say Michael Avenatti illegally pocketed $300,000 from Stormy Daniels' book advance.
• They allege that he forged Daniels' signature and lied to her about where the money was going.

Michael Avenatti stole $300,000 from the adult film actress Stephanie Clifford, known as Stormy Daniels, while representing her, prosecutors allege.

Avenatti has been charged with wire fraud and aggravated identity theft, and his trial began on Monday. During opening arguments, federal prosecutors said Avenatti pocketed $300,000 out of Daniels' $800,000 book advance by forging her signature on a letter to the book's publisher.

"Adult film actresses and paranormal investigators can be victims of fraud and identity theft too, just like anybody else," Assistant US Attorney Andrew Rohrbach said. He also said Avenatti was in "desperate" need of cash when he stole part of Daniels' book advance.

Rohrbach said that in addition to sending the unauthorized letter with Daniels' forged signature, Avenatti directed her agent to send money to his own bank account and lied to Daniels about where the money was.

"He told her that the publisher was being slow," Rohrbach said. "He told her the publisher was working on it. But the whole time he had the money and he was spending it."

Avenatti's lawyers pushed back, claiming Daniels, who plans to testify against her former lawyer at his trial, is unreliable and lacks credibility.

"When Ms. Daniels doesn't get her way, when she gets upset about something, she turns on the people closest to her," said Avenatti's lawyer Andrew Dalack.

Dalack also said that Daniels owed Avenatti money for his services as her lawyer and did not uphold her end of their contract.

Avenatti gained national attention when he represented Daniels in her high-profile lawsuit to break the nondisclosure agreement she signed agreeing to keep quiet about an affair she claims to have had with Donald Trump in the mid-2000s.

The lawsuit resulted in the revelation that Trump's former lawyer and longtime fixer, Michael Cohen, made an illegal hush-money payment to Daniels in the weeks before the 2016 presidential election.

Cohen also pleaded guilty to tax evasion and bank fraud, and said he broke campaign finance laws at Trump's direction. He served several years in prison as a result and was released in late November.

Cohen was outside the courthouse when Avenatti's fraud trial kicked off this week, and some reporters said Avenatti greeted Cohen by asking him about his "Donald Trump kneepads."

Cohen hit back, telling reporters that Avenatti has "shown himself to be the dirtbag everybody expects him to be."

Avenatti was previously sentenced to more than two years in prison after he was convicted of trying to extort up to $25 million from Nike. If convicted following his fraud trial, Avenatti faces up to 22 year in prison.

This story is developing. Check back for updates.