By FRED SHUSTER
LOS ANGELES — Tom Girardi, co-founder of the defunct Los Angeles law firm Girardi Keese, was indicted by a federal grand jury for allegedly embezzling more than $15 million from several of his legal clients, federal prosecutors announced Wednesday.
The 83-year-old Girardi — the estranged husband of “Real Housewives of Beverly Hills” star Erika Jayne — is charged with five counts of wire fraud, a crime that carries a prison sentence of up to 20 years. Girardi, who has Alzheimer’s disease, was deemed incompetent to manage his own affairs in June 2021 and was disbarred a year later.
U.S. Attorney Martin Estrada declined to comment on whether Jayne is being investigated as part of the ongoing probe into the Girardi Keese firm.
Also charged in the indictment unsealed Wednesday was Christopher Kamon, 49, formerly of Encino and Palos Verdes, the firm’s former chief financial officer.
The indictment alleges that, from 2010 to December 2020, Girardi and Kamon fraudulently obtained more than $15 million that belonged to the firm’s clients.
Estrada said the defendants engaged in a “widespread scheme to steal from their clients and lie to them to cover up the fraud. In doing so, they allegedly preyed on the very people who trusted and relied upon them the most — their clients.”
Attempts to reach a representative for Girardi were unsuccessful. Kamon’s attorney did not immediately return a call requesting comment.
Also on Wednesday, Girardi, Kamon and former Girardi Keese partner David Lira were indicted in Chicago federal court on fraud charges for allegedly misappropriating more than $3 million in settlement funds intended for relatives of victims killed in the 2018 crash of a Lion Air flight in Indonesia.
“The substantial misappropriation alleged in this indictment compounded the grief and anguish of the clients who lost loved ones in the Lion Air crash,” John Lausch, U.S. attorney for the Northern District of Illinois, said in a statement. “Attorneys who violate the trust of their clients and breach a fiduciary duty that is paramount to the practice of law must be held accountable.”
To conceal the theft and misappropriation of settlement money in the Los Angeles case, Girardi and Kamon allegedly lied to clients, stating falsely, among other things, that the funds had not been paid. Girardi also allegedly falsely told clients that settlement proceeds could not be disbursed until certain purported requirements had been met, such as eliminating purported tax obligations, obtaining supposedly necessary authorizations from judges, and satisfying medical liens and other debts.
Girardi became widely known when he was thanked in the credits of the 2001 Oscar-winning film “Erin Brockovich,” for which he served as an adviser. The attorney was part of the legal team when Brockovich successfully sued Pacific Gas & Electric in 1993 for contaminating the groundwater of a small California town.
Estrada said that behind a public persona of integrity, for which he received numerous awards and commendations, Girardi was “robbing and stealing from those people he claimed to be championing” and “committing fraud on a grand scale.”
After he was disbarred last year, the State Bar of California said it had received 205 complaints against Girardi alleging he misappropriated settlement money, abandoned clients and committed other serious ethical violations over the course of his four-decade career.
Girardi Keese, famous for representing plaintiffs in large-scale civil litigation against major corporations, collapsed in late 2020 after Girardi was accused in a Chicago lawsuit of embezzling money meant for clients the firm was representing in litigation over the airline crash. The lawsuit brought by plaintiffs’ firm Edelson PC has since been transferred to Los Angeles.
Kamon, the first person to face criminal charges in the scandal, pleaded not guilty last week in Los Angeles to a federal wire fraud charge separate from the charges announced Wednesday. Prosecutors allege he funneled more than $10 million from the law firm’s operating accounts for his personal use.
Kamon spent millions on home renovations, exotic cars, and “female escorts,” federal prosecutors allege.
Kamon was arrested on the charge in November at Baltimore airport after arriving on a flight from the Bahamas, where he had purchased a $2.4 million home, court papers show.
He remains in federal custody after his attorneys unsuccessfully argued for his release at several hearings. If convicted, he faces up to 14 years in prison, authorities said.
A magistrate judge set a March 14 jury trial before U.S. District Judge Josephine L. Staton in downtown Los Angeles.
An affidavit filed in the Kamon criminal case says Girardi wasn’t aware of Kamon’s alleged $10 million “side scheme.”
Girardi is in Chapter 7 bankruptcy proceedings, as is the now-shuttered Wilshire Boulevard law firm, which faces more than $500 million in claims.
An initial court appearance for Girardi was tentatively set for Monday in federal court in downtown Los Angeles.