Attorney Tom Girardi found guilty of wire fraud, embezzling $15 million from clients

Jurors reached a verdict Tuesday morning in the trial of Tom Girardi, the once high-powered Los Angeles attorney accused of running a 10-year Ponzi scheme that defrauded his clients of millions of dollars in settlement funds.

Girardi, 85, has been convicted of four counts of wire fraud for diverting at least $15 million away from four of his clients, some of whom suffered serious physical injuries or lost loved ones as part of their cases. During his trial, prosecutors argued he spent the stolen money on private jets and jewelry, keeping up a luxurious lifestyle with a sprawling Pasadena estate that was depicted on "The Real Housewives of Beverly Hills," the reality show starring his now-estranged wife Erika Jayne.

In 2021, the allegations against the former personal injury attorney were the focal point of the Hulu documentary series, "The Housewife and the Hustler." He was disbarred in 2022.

"Tom Girardi built celebrity status and lured in victims by falsely portraying himself as a 'Champion of Justice,'" U.S. Attorney Martin Estrada said in a statement announcing Girardi's conviction. "In reality, he was a Robin-Hood-in-reverse, stealing from the needy to support of a lavish, Hollywood lifestyle."

Federal prosecutors have argued that he misappropriated and embezzled millions from his clients between October 2010 and late 2020. Among the victims Girardi stole from, prosecutors say, were families of victims in the October 2018 Lion Air Flight crash which left 189 people dead. That tragic crash was the first of two involving Boeing 737 Max 8 jets over just a five-month span.

By the end of 2020, prosecutors say, Girardi's firm was facing worsening financial issues that ultimately forced him into bankruptcy.

Girardi has long denied the claims. The federal public defender representing him, Charles Snyder, argued that Girardi's cognitive impairment has worsened following diagnoses with dementia and late-onset Alzheimer's disease. Snyder also said members of Girardi's now-closed Girardi Keese law firm were stealing funds "hand over fist."

Snyder said "Girardi was not paying close attention" to the firm's operations as he "got old, got sick, and lost his mind." 

But federal prosecutors have said Girardi's defrauding of clients was intentional.

"He wanted the outside world to believe he was fighting for people who couldn't help themselves," Assistant U.S. Attorney Ali Moghaddas said during closing arguments on Monday.

But those clients just kept waiting for the money to come in, and from there, "days turned into months and months turned into years," Moghaddas said.  

On Tuesday, Estrada said Girardi could face up to 80 years in prison at his sentencing on Dec. 6 but the court will take a few factors into consideration. Girardi is currently living at a nursing home in Orange County.

"We are not going to prejudge that," Estrada said. "We will look at all the facts as they come in."

However, Estrada also said the potential for prison time is not off the table.

"But the mere fact that he is older, an older adult, does not mean we will not seek prison time," he said.

'Champion for the little guy'

In 1996, Girardi was among the lawyers representing the tiny San Bernardino County desert community of Hinkley in a water contamination lawsuit against utility giant Pacific Gas & Electric, with the chemical chromium blamed for the development of cancer and other diseases in residents. 

PG&E agreed to a settlement of $333 million to the hundreds of plaintiffs, and the case was made famous with the 2000 film starring Julie Roberts, "Erin Brockovich." At the time of the settlement, the Los Angeles Times reported Girard had hailed it "as a great moment in the history of wrongs being righted."

The personal injury lawyer went on to secure million-dollar settlements in other high-profile personal injury cases, developing a reputation as a legal titan in LA. 

"Mr. Girardi portrayed himself as a champion for the little guy," Estrada told reporters during a news conference following the guilty verdict. "He marketed himself as the lawyer for Erin Brockovich."

Estrada said the now-disbarred attorney "cultivated an image as a lawyer who fought against corporate greed." But that reputation came into question with the 2021 airing of "The Housewife and the Hustler," which put highlighted claims against him by clients — including families of victims in the 2018 Lion Air crash. They alleged Girardi and two of his colleagues at his now-defunct firm stole more than $3 million in settlement money from them. 

Last year, Girardi was indicted on federal charges in connection with those allegations.

"The substantial misappropriation alleged in this indictment compounded the grief and anguish of the clients who lost loved ones in the Lion Air crash," U.S. Attorney John Lausch said at the time.

A lavish lifestyle gets upturned

When Lion Air victims started asking Girardi where the money was, in May 2020, he tried stalling them. At the time, he told one client in a letter, "I think you are going to love me in 30 days." 

Months later, in December of that year, an attorney who represented the Lion Air victims alongside Girardi, Jay Edelson, sued him. He said in court filings that Girardi revictimized those he represented in the wrongful death lawsuit.

"You have this kind of celebrity lawyer with his celebrity wife just spending it on who knows what. It really is hard to process," Edelson said.

The following year, "The Housewife and the Hustler" aired in the summer of 2021 and shined light on claims made by the families of victims in the Lion Air crash. By then, prosecutors say, Girardi was already grappling with legal issues tied to a decade of stealing from clients and had been forced into bankruptcy and disbarred. 

The allegations against him soon surfaced on the reality TV show in which his now-estranged wife stars. Erika Jayne, who prosecutors say had her pop music career funded by the tens of millions Girardi defrauded from clients, shows joins co-starts on Bravo TV's "The Real Housewives of Beverly Hills" in showing off designer clothes, jewelry, sports cars and mansions.

She eventually filed for divorce from Girardi.

"Of course, he had a very lavish lifestyle," Estrada said Tuesday. "You just have to watch a little bit of television to see how lavishly he was living."

Just two months after the documentary aired, Girardi was auctioning off prized possessions from his law firm on Wilshire Boulevard, including a Los Angeles Lakers championship ring, over 100 bottles of wine and a framed receipt from the 1996 Hinkley water lawsuit.

This past January, a federal judge ruled Girardi was competent to stand trial. After a 13-day trial, jurors found him guilty of four counts of wire fraud, which prosecutors say each carries a potential maximum sentence of 20 years on each count.