Reality TV show star Abby Lee Miller has been indicted on bankruptcy fraud and other federal charges for concealing income she earned on "Dance Moms" and related spinoff shows, prosecutors said on Wednesday.
A federal grand jury returned a 20-count indictment on Tuesday against Miller, 50, on charges of bankruptcy fraud, concealment of bankruptcy assets, and false bankruptcy declarations.
She will be arraigned on Nov. 5 in US District Court in Pittsburgh, said a spokeswoman for US Attorney David Hickton.
If convicted, Miller faces up to five years in prison and a $250,000 fine for each count, Hickton said in a press release.
Miller had filed a petition to reorganise her dance studio, Abby Lee Dance Company in the western Pennsylvania municipality of Penn Hills, in December 2010. She is accused of scheming to defraud the bankruptcy court by concealing income she earned between 2012 and 2013, by creating bank accounts to hide it.
"Miller knowingly concealed ... a substantial amount of business income which she earned from her appearances as a featured performer on the reality television programme 'Dance Moms,' and related spin-off TV programs, as well as income she earned from Masterclass dance events and online merchandise sales from Abby Lee Dance Company.com," the indictment said.
"Dance Moms" on the Lifetime television network, currently in its fifth season, exposes the lives of competitive young dancers, including the tensions between their parents and Miller. She is currently filming a sixth season, said her lawyer, Robert Ridge of Pittsburgh.
Some of the fraudulent activity came to light after a bankruptcy judge, channel surfing one night, spotted some of the related shows and raised questions about Miller's claim to be cash-strapped, the indictment said.
"I realised there is a lot of money coming into this plan, this case and it hasn't been disclosed," the indictment quoted the judge as saying at a court hearing in 2013.
Investigators also found emails from Miller to her accountant and a joint venture partner in 2013 with the subject line "LETS MAKE MONEY AND KEEP ME OUT OF JAIL," admonishing them to "not raise any red flags" and "DON'T PUT CASH IN THE BANK!!!," according to the indictment.
Miller's lawyer said in a statement his client entered bankruptcy to save her business and "has paid all of her creditors 100 cents on the dollar. There is no loss to any of her creditors."