The former business manager of rocker Alanis Morissette has admitted embezzling more than $7 million from the singer and other celebrities and falsely claiming the money was used to grow marijuana.
Jonathan Todd Schwartz, 48, of Los Angeles, had agreed to plead guilty to federal charges, prosecutors said on Wednesday. He was charged with wire fraud and filing a false tax return for failing to report the embezzled funds, prosecutors said.
Schwartz admitted stealing nearly $5 million from Morissette between May 2010 and January 2014. He also admitted to stealing $2.3 million from five other clients who were not named in court documents or disclosed by attorneys in the case.
He used the money personally and falsely listed the cash withdrawals as “sundry/personal expenses” to cover up the crime.
When confronted about the theft, Schwartz lied and said he invested the money in an illegal marijuana growing business, prosecutors said.
Schwartz had offered financial guidance to some of the biggest stars while working at GSO Business Management, a firm that touts its relationship with entertainers such as Katy Perry, 50 Cent and Tom Petty on its website.
GSO’s pending lawsuit against Schwartz said he used the money to fuel a lavish lifestyle that included a $50,000 trip to Bora Bora and a $75,000 debt at a Bahamas casino.
Defense lawyer Nathan Hochman said Schwartz had fully cooperated with investigators and accepted responsibility.
Although Schwartz technically faces up to 23 years in prison, his plea deal states a sentence of four to six years in prison will be considered by the judge.
Schwartz, who no longer works at GSO, was said to represent Beyonce and Mariah Carey, who both appeared at a fundraiser last year in support of a heart disease charity he founded.
The embezzlement was discovered after Morissette took her business elsewhere and her new money manager discovered millions of dollars missing and contacted GSO, according to lawsuits filed against Schwartz.
GSO reviewed Schwartz’s other work and found the other thefts, said GSO attorney Chris Reeder, who sued Schwartz after he was removed from the firm. “This was shocking and disappointing,” Reeder said. “The company is very happy he’s being brought to justice and held accountable for his actions.”
Reeder said GSO has since repaid all the money he stole from clients.
Morissette settled her suit against Schwartz and GSO, according to a joint statement issued last year. Her publicist had no comment on Wednesday.
The Canada-born, Los Angeles-based singer said she turned down a “lucrative” offer to perform five shows in Las Vegas after Schwartz convinced her she did not need the money.
Schwartz is scheduled to appear in US district court on the criminal charges on February 1.