Erica Jayne's ex Tom Girardi ran a 'massive Ponzi scheme' to defraud clients out of millions, prosecutor tells LA court in Real Housewives' 'trial of the century'

Disgraced lawyer Tom Girardi ran ‘a massive Ponzi scheme’ to defraud clients out of millions of dollars, a prosecutor told jurors Monday on the final day of the now-disbarred attorney’s nearly three-week trial at Federal court in Los Angeles.

‘He acted with intent to defraud - he knew what he was doing’ said Assistant U.S. Attorney Ali Moghaddas in his closing argument before the case against Girardi - estranged husband of Real Housewives of Beverly Hills star Erika Jayne - went to the jury to decide a verdict.

‘He lied to his clients over and over and over again about why they weren’t being paid. He lied to them them because he did not want to give them their money because it was gone….it was already spent.

‘Behind the curtain he was pilfering his clients’ funds. It was just cruel to treat victims in this manner.’

Tom Girard, 85, is accused of running a 'massive Ponzi scheme' to defraud clients out of millions of dollars

Girardi, 85 - is charged with four counts of wire fraud in which he’s accused of swindling clients out of $15 million in settlement funds they were owed for injuries they suffered. He’s pleaded not guilty to all the charges.

The one-time super lawyer - looking tired and somber Monday and wearing a blue and white striped shirt, khaki pants and the same rumpled gray jacket he’s worn for much of the trial - built the powerful law firm, Girardi Keese, after his fight against a California utility giant inspired the Oscar-winning movie Erin Brockovich.

But his high-flying career collapsed in 2020 when he was accused of stealing millions in settlements he’d won for the victims of the 2018 Lion Air plane crash in Indonesia

Claims from that crash - in which 189 people died - are the basis of separate criminal charges against Girardi that are still pending in Chicago. He has pleaded not guilty to those charges as well.

Federal prosecutors say that between 2010 and 2020 the shamed attorney - who is facing 20 years in prison if convicted - lied to clients and used their misappropriated millions to pay for his own lavish lifestyle of ‘private jets, luxury cars, expensive jewelry and exclusive golf and country club memberships ’ with his third wife, ex-go-go dancer Jayne, 52, including $20 million to fund her acting career.

The former attorney and estranged husband of Real Housewives of Beverly Hills star Erika Jayne is charged with four counts of wire fraud in which he allegedly cheated clients out of $15 million in settlement funds they were owed for injuries they suffered from his law firm's clients between 2010 and 2020

Meanwhile, when he took the witness stand last week Girardi denied any wrongdoing, claiming 'every client got every penny that every client was supposed to get.'

And he blamed his law firm’s chief financial officer, Christopher Kamon, 49, for plundering the victims’ settlement funds, embezzling some $50 million.

His defense team has insisted that Girardi is mentally unfit to stand trial and his advanced dementia prevented him from understanding that Kamon was robbing his company.

Kamon has been charged with wire fraud charges similar to Girardi’s, but is being tried separately. He is also accused of embezzling $10 million from Girardi Keese which is now in bankruptcy with $100 million in debts. Kamon has pleaded not guilty to all the counts he’s facing.

Girardi testified in his own defense last week and denied any wrongdoing, claiming 'every client got every penny that every client was supposed to get'

In court Monday, Moghaddas insisted that Girardi is as much to blame for cheating clients as Kamon.

‘There is no question that Mr Kamon is guilty,’ he told the jury of seven men and five women. ‘‘But today is not Mr Kamon’s day, it’s Tom Girardi’s day. And saying Kamon did it doesn’t fly.

‘Was it Kamon who was lying to clients? Was it Kamon who was hiding documents? Was it Kamon’s name on the door of Girardi Keece?’

While Moghaddas conceded that Girardi’s mental state may have declined, he scoffed at the defense’s claim that it was his dementia that was the cause of him not realizing his clients were being swindled in the decade between 2010 and 2020.

‘The only mental state that matters is the one when these crimes were committed, not his mental state today,’ he said. ‘Mr. Girardi was defrauding clients long before his mental decline.’

In his closing argument, defense attorney, Charles Snyder, countered, telling jurors that Girardi’s cognitive loss made him like the title character in the movie ‘Weekend at Bernie.’

‘He got old, he got sick, he lost his mind. The lights were on but there was nobody home. He lost touch with reality.’

Girardi's defense team has consistently argued that he is mentally unfit to stand trial due to cognitive decline. However, a federal judge ruled earlier this year that he is competent to proceed with the case

Describing Girardi’s diminishing mental abilities, Snyder said he ‘mixed up cases, didn’t recognize his wife, lost documents’ and once thought he was the secret personal attorney to then Vice-President Joe Biden.

Snyder said Girardi was overwhelmed with ‘hundreds of cases and thousands of clients. ‘He was not paying close attention to what he was signing. What he knew was what he was told by Mr. Kamon. He unwittingly signed off on the theft of tens of millions of dollars by Mr. Kamon.

Describing Kamon as ‘a virtuoso, a Michael Jordan when it comes to lies and deception,’ Snyder said the former Girardi Keese CFO - who earned $350,000 a year in salary from the firm - ‘walked off with somewhere between $50 and $100 million’.

‘Mr. Kamon had unfettered access to the Girardi Keese client trust accounts - which took in $1.2 billion between 2010 and 2020 - with virtually no oversight. The firms’s finances were totally under Mr. Kamon’s control.

‘Mr. Girardi was not a knowing participant in Mr. Kamon’s fraud. He had no real idea of what was going on with the firm’s finances.

‘But the remedy for bad management is going out of business - which the firm did - not criminal charges.’

Jayne seen with ex Girardi and son Tommy Zizzo when he was still a child 

Snyder told the court that when Girardi he found out that Girardi Keese was hemorrhaging money and endanger of going under, he put millions of his own money into the firm to try keep it afloat.

It didn’t succeed and Girardi ended up broke. ‘He lost more of is own money than anyone,’ added Snyder.

In rebuttal of the Girardi defense closing argument, Assistant U.S. Attorney Scott Paetty said the case is ‘a simple and sad story of trust violated and greed’ in which the once exalted lawyer ‘was buying private jets (he had two worth a total of $12 million) while his clients weren’t getting paid.

Paetty poured scorn on Girardi blaming Chris Kamon for the massive fraud, saying that ‘Girardi took $14 million’ from company accounts prior to 2010 ‘which is when Kamon started at Girardi Keese.’

‘Girardi Keese was a den of thieves and Tom Girardi was the thief-in-chief. Girardi Keese was a house of cards built on Tom Girardi’s lies.’

As for the defense claim that Girardi’s mismanagement was partially to blame for the charges against him, Paetty said, ‘Disorganization and sloppy record keeping aren’t a defense to fraud.’

And on the defense’s argument that Girardi’s declining mental ability made him unaware that Kamon was ripping off millions, Paetty added, ‘Who knows what hs mental state is today but what’s important here is his mental state when he was lying to clients and stealing their money.’

After the prosecution’s rebuttal, Judge Josephine Staton sent the jury out at 2.20pm to start their deliberations.