So Many Strings Attached | Part II
41:56 Share

Wondery Plus subscribers can listen to Scamfluencers early and ad-free right now. Join Wondery Plus in the Wondery app or Apple Podcasts. A heads up to our listeners. This episode includes references to sexual harassment, abuse, and grooming. Please listen with care.

Hi, Sarah. Hey, Sachi. Okay, I have a question for you today. Okay. Have you ever taken advantage of a friend? Like you didn't pay them back or you didn't tell them the truth, like whatever that looks like for you. No, I don't think I'm capable of that. And I don't mean that in a good person type of way. I mean, like it just sounds like a lot of work and I'm scared of something bad happening to me if I do that. Yeah, fear is a preventative measure on this stuff for sure.

Well, I ask because today's conclusion of our scam is all about how you can't run your friends ragged and still expect them to stand by your side. And you know what, Sarah? It's a good lesson for us all. It's towards the end of 1999. Lou Pearlman sits in a dark nightclub just outside of Orlando. He's auditioning guys for a new band called O-Town. ♪

Things look very different from when Lou held auditions for the Backstreet Boys seven years earlier inside a blimp warehouse. This time, Lou's taken over the Atlantic Dance Hall on Disney's boardwalk.

And cameras are there filming it all for a reality show that'll air on ABC. Sarah, did you ever watch the show? Sachi, I watched every single episode of Making the Band. I was obsessed with O-Town. I was obsessed with the show. And it was basically just like a type of star search thing, creating a perfect boy band. And they succeeded. O-Town was very popular for one whole album. Yes, absolutely.

Well, it's been less than a year since the Backstreet Boys and NSYNC sued Lou to get out of their shitty contracts. But they're doing just fine without him. In fact, it's around this time that Backstreet's most iconic single, I Want It That Way, is released.

and NSYNC are about to drop Bye Bye Bye off the forthcoming album No Strings Attached. It's about a breakup, but it may as well be a farewell to Lou. Meanwhile, Lou's been acting like he's the victim in the split with NSYNC and Backstreet, like in this interview with 2020. The kids should take a step back and say, how'd I get here? Who took the risk? Who put up all the money? Who's my real big pop-up?

Adult men referring to themselves as Papa is a crime. Okay, you know what? That sentence alone, who's my real big Papa? Like he should have been arrested on the spot and sent to prison. That's exhibit A in the trial. You can't do that. You can't call yourself big Papa when referencing literal teenagers that you knew. Well, as you've heard, Lou talks a big game, but he needs a win right now.

He's hoping O-Town will keep his name in the headlines and that the money they make him will keep funding his Ponzi scheme. Lou has been encouraging people to invest in Transcon for more than two decades. And this is basically an umbrella company for all of his ventures. And there are some legit businesses like restaurants and retail stores, but there are also these fake investment accounts. He calls them ISAs. And at this point, Lou has convinced more than a thousand people to invest in them.

But the truth is, Lou uses their money as his personal slush fund. If an investor wants to take their money out, Lou has to find a new investor to cover the cost. And if that sounds precarious, well, that's because it is. When authorities finally catch wind of Lou's scheme, he will become the subject of an international manhunt. From Wondery, I'm Sachi Cole. And I'm Sarah Hagee. And this is Scamfluencers. Attention, I'm going out.

In part one of the series, Lou Pearlman transformed himself from an aviation nerd into a boy band mogul. But nearly all of his success came from cheating the people around him. He screwed over his best friend and convinced his family and neighbors to invest in a fake company. And then he roped a bunch of teenage hopefuls into some of the worst contracts the music industry has ever seen.

If you haven't listened to that episode, go back and do so now. And then meet us right back here. Because Lou's scams are about to get even more complicated. And when they fall apart, the result will be catastrophic. Not long after the O-Town auditions, Steve Mooney is driving to Lou Pearlman's mansion. He's in his early 20s, and he's been working as Lou's personal assistant for the last two years. So he knows the route really well.

This is probably the first time he's had to do it at two in the morning. Lou initially called Steve earlier that night. He told Steve to come over and take out his trash, like right now. Steve said no. The request set off alarm bells for him. He's a good looking guy, and he's noticed that Lou seems to have a particular interest in him. He later tells Vanity Fair that Lou would say things like, quote, I want to break you down, then build you up so we can be a team together.

Lou would also tell him that his aura was off and he'd give Steve unsolicited back rubs. Oh boy. I do wonder what it is about men in these positions giving their employees like back rubs.

Creepy men are dying to rub the backs of whoever works for them. I don't get it. Well, a few hours after Lou initially called Steve to take out the trash, he calls him again. And this time, Steve agrees to come over. He took this job because he wants to be a singer. And Lou made it seem like this would be his ticket to stardom. But Lou won't even let Steve audition for O-Town. And now, Steve is starting to wonder if Lou meant any of the things he said when they first met.

When Steve pulls up to the house, he feels like something's off. He confronts Lou in his office, arguing about whether he really needed him to come take out the trash. Or whatever. At this hour? Lou stares back at him in his chair, wearing a terrycloth bathrobe and white underwear.

Finally, Steve asks him straight up what he needs to do to secure his spot in O-Town. Steve later tells Vanity Fair that in response, Lou leans back, spreads his legs and says, you're a smart boy, figure it out.

That is so disgusting. And it just shows that like with the promise of success in the arts, it's so easy to take advantage of someone who like is talented and wants a shot at something. And I feel like the story is the perfect example of that. Well, Lou denies that any of this happened. He says that Steve made this story up because he was mad that he didn't make the band.

For decades, Lou has used his reputation as a successful businessman to get anything he wants, including access to young, attractive men and boys. But his luck is running out, and his bravado isn't going to cut it anymore when he starts taking out bank loans that he can't repay.

A year later in 2001, O-Town's first album goes platinum thanks to the inappropriate soundtrack of my elementary school days, Liquid Dreams. But their sophomore album is a massive disappointment. And the other new acts that Lou has tried to develop haven't taken off either. By 2002, he's looking for a new way to generate income and headlines. And that's when he learns about Church Street Station.

Church Street is a former train depot in downtown Orlando. It was revamped into an open-air mall in the 70s. It used to be a big tourist attraction, but people aren't really hanging out there anymore. The four acres of prime real estate have become a giant money pit for the city. Local leaders are desperate to have someone revitalize it. Enter Lou Pearlman.

The space is already very Lou. It's got an old-fashioned saloon and a place called Phineas Fogg's Balloon Works where you can listen to pop music while learning about the history of hot air ballooning. I cannot believe I am not lying when I tell you this. It's like Lou is the target demo for this entire place. Imagine going on a date to listen to pop music and learn about the history of hot air ballooning at Phineas Fogg's Balloon Works. I would marry that man. I'm sorry to say.

The city of Orlando is so desperate to reinvigorate Church Street that they give Lou a $1.5 million loan so that he can buy the place and fix it up. In return, Lou promises to stage hundreds of live events there and add around 500 jobs to the city's economy.

Lou starts renovating Church Street Station right away. He even moves TransCon's offices there. But despite the loan, construction is expensive. And contractors don't take IOUs. So Lou starts borrowing from the banks. He starts out with a $5 million loan from one bank. And over the next few years, he gets loans totaling more than $40 million from another bank.

To secure these loans, he sends financial records he says were prepared by a firm called Cohen and Siegel, which, Sarah, doesn't exist. We spoke with Helen Huntley, a reporter with the St. Petersburg Times, who later looks into Lou Pearlman's finances. Here's her explanation on how he managed that scam. ♪

It was totally fake. The address was just a mail drop kind of place down in the South Florida. And at one point, the phone was being answered by a secretarial service. And they would just say, you know, Mr. Cohen's not available and, you know, take a message. But later on, it was just rig on Lou Pearlman's desk. The phone would just come right to him. Oh, my God.

It's like a cartoon. It's like he learned all these tricks from Archie comics. He like invented his own world of things that like technically exist because they're written down on paper. But this is nothing. This is insane.

Lou starts out with a $5 million loan from one bank. And over the next few years, he gets loans totaling more than $40 million from another bank. The documents from Cohen and Siegel make it look like Lou is a multimillionaire. And the banks are probably so dazzled by Lou's reputation that they don't really check his previous tax returns, in which he claimed a negative net worth.

Once again, it seems like everything's coming up Lou. But what started out as a publicity stunt will eventually put him in his most vulnerable position yet. It's 2004, and Lou is in Chicago for a funeral. The funeral home is beautiful, with glossy hardwood floors, leather chairs, and brass angels. The service is for Joseph Chow, Lou's longtime friend and a major investor in TransCon.

Joseph was an engineering professor Lou met in the early 90s when Lou was looking for investors in his blimp company. The two grew close over the years, and Lou even attended Joseph's daughter's wedding. Joseph ended up investing around $14 million in Transcon and his own ESA. Joseph's substantial investment was huge for Lou, especially since lately his finances haven't been great.

Since O-Town, Lou hasn't been able to find that magic in a bottle with the other bands he's managed. And his only real source of income for the past two years have been bank loans and selling Isas. Meanwhile, renovations on Church Street Station have stalled. It's actually gotten bad enough that the city of Orlando is threatening to pull back some of their $1.5 million loan.

Sitting at the funeral, Lou's got to be panicking. Joseph was one of his biggest investors. And now that he's gone, his family is looking to cash out on his investments. So Lou's been hedging. He just does not have Joseph's money. In person, he plays nice, and he promises that he'll make it right. But when he gets back to Florida, Lou tells the family that business hasn't been so great. And if they need the money right now, he can only give them 10 cents on the dollar.

So the Chows are obviously like, uh, no. And Lou probably senses that, well, they're about to sue him. So he sues them first. He claims that Joseph signed something called a forbearance letter, which basically says that TransCon only has to pay him back on a convenient repayment schedule set by their board of directors, which is just Lou.

And since he doesn't have his money, the timing is just not convenient.

Okay, so, I mean, this family is clearly looking out for their money, which makes sense. And I'm guessing they probably aren't the only ones who are like, hey, Lou, about that investment, where are those returns? Yeah, Sarah, you're right. The Chows are not the only investors asking for money. One bank is suing Lou for non-repayment on one of his loans. Others are expecting payment soon as well. And when they don't get it, there will be even more trouble. Yeah.

Over the last six years, Lou has borrowed something like $160 million from various financial institutions. And just as all the investors start reaching out, the law comes knocking too. In 2006, Danielle Brooks is an investigator with the Florida Office of Financial Regulation. They're tasked with keeping an eye on businesses that invest or lend money. Think banks, insurance brokers, credit card companies, and investment accounts.

Danielle is a brunette with a sunny smile. She's young and she's pretty new at this job. She's also eager to prove herself. So when her supervisor asks her to look into TransCon's ESA accounts, she jumps at the chance. A county investigator had gotten in touch about some of the claims Lou is making about ESAs, the supposed investment plans he claims are super safe, even going so far as to say that they're backed by the FDIC.

But this claim immediately raises a red flag for Danielle since the FDIC doesn't insure money invested in things like stocks, bonds, mutual funds, or securities. So Danielle calls Lou to find out what's going on. And when she finally does get him on the phone, he seems totally unfazed by her. He actually says to her, quote, I don't know if you know who I am. That's an insane thing to say because at this point, he's an abject failure. Like,

It's been years since he's had any success. He's had two and a half successful boy bands. It's ballsy, I'll say that. It's very ballsy. It's kind of like, okay, you're Lou Pearlman and you're a weirdo. Like, yeah? Well, Danielle is not intimidated. In fact, she becomes even more determined to figure out what's going on.

She works on the case, solo, for months, making a spreadsheet to track Lou's transactions. And she tries to figure out where Lou's money is actually coming from and where it's going. She doesn't have the whole picture yet, but she starts to suspect more and more that Lou is exploiting people on purpose. As she continues to investigate, Lou continues to run out of money and public goodwill.

A few months later, in the fall of 2006, Helen Huntley is sitting in her office cubicle at the St. Petersburg Times. When the phone rings, Helen isn't surprised. She hears from readers pretty regularly, so it's not a shock when the person calling says he wants her to look into something. And that's when Helen first hears the name Lou Pearlman.

Her source tells Helen that he's having trouble getting his money back from his trans con, Issa. Even before Helen starts looking into Lou, she's wary.

Retirees have money to invest and a lot of them are very safety conscious. You know, they're afraid of the stock market. So anything that comes along that say secured or safe, they really look to that. So a lot of these bad investments are things that are promised as secure and safe and that pay some kind of income. So they think, you know, this is like my ideal solution.

Helen spends several months talking to a number of Luz victims, and they all have similar stories. For instance, there's a woman named Dorothy Richards who recently retired from her job as a social worker. She's only 59, but she has a respiratory disability that makes working impossible. Luckily, her dad left her $142,000, and she's invested all of it in a trans con ISA.

This is the worst kind of story. It's the worst kind of story because this is not someone who can easily recover that money. Like, she's just a normal woman. And also, Helen is doing an amazing job. And that's what happens when you support local news. We love Helen. Yes. Well, Dorothy found TransCon through an estate lawyer who told her that he sends clients to TransCon all the time. So she really thought she was being smart with her money.

And she thought the investment was backed by the FDIC. But now she's been trying to get her cash out for months and no one is answering the phones. In December 2006, after speaking to countless victims, Helen publishes her first story on Lou. Later that same week, Danielle's work finally bears fruit and the Office of Financial Regulation publicly announces that they're looking into TransCon's ISAs.

So now all of the investors are freaked out and they immediately go to cash out their investment accounts. The Office of Financial Regulation has actually ordered Lou to stop selling ISAs until they can figure everything out. Lou is losing everything fast. And for once, he can't Ponzi his way out of it.

Summer should be fun, not financially stressful. So if you're looking to build your credit with everyday purchases this summer, do it with the Chime Secured Credit Builder Visa credit card. Yep. With no annual fees or interest, Chime is a great tool to help build credit using your own money. And they have features like fee-free overdraft up to $200 with SpotMe.

When you set up a qualifying direct deposit and sign up for SpotMe, Chime will spot you up to your limit when you make a credit card purchase or cash withdrawal that exceeds your balance. That is a game changer, especially since there's no fee to use SpotMe. With Chime's secure credit card, you can improve your credit scores all summer long. Get started today at Chime.com slash Scampod. That's Chime.com slash Scampod.

Chime feels like progress. The Chime Credit Builder Visa credit card is issued by the Bancorp Bank, N.A. or Stride Bank. N.A. spot me eligibility requirements and overdraft limits apply. Out-of-network ATM withdrawal and OTC advance fees may apply. Terms and conditions apply. Go to Chime.com slash disclosures for details. Hormones can be a real roller coaster. One minute you're feeling energized and balanced, and the next you're dealing with pesky PMS symptoms.

It doesn't feel good. And it doesn't help that there are over a thousand common environmental factors that can disrupt your delicate hormone balance, from the food you eat to the skincare products you use. But the good news is there's a way to get your hormones back on track.

Happy Mammoth's Hormone Harmony is a science-backed supplement that's specifically formulated to support women through all the hormone changes you face, from menstrual cycles to menopause. It uses powerful adaptogenic herbs that can help your body adapt to these chaotic hormonal shifts. Yeah, the results speak for themselves. Their supplements have over 17,000 glowing reviews, with customers raving about feeling like themselves again. And for a limited time, you can get 15% off your entire first order at HappyMammoth.com.

Just use the code SCAMPOD. That's happymammoth.com, M-A-M-M-O-T-H, with the code SCAMPOD to get 15% off your entire first order. Now I feel like a legend.

A month or so after Helen's first story about Lou hits the newsstands, FBI agent Scott Skinner starts looking into Lou's businesses. He has bright blue eyes, close-cropped hair and glasses, and he specializes in white-collar crime. He describes himself as an accountant with a gun, which is actually a Ben Affleck movie. It's around this time that Scott gets a phone call from a criminal defense lawyer named Chaney Mason.

Cheney's call catches Scott off guard. Usually, Cheney is on the other side of a courtroom from law enforcement. But today, he seems to be on Scott's side. He asks him to come by his office in Orlando so he can share some information. Cheney's in his early 60s. He's got a bit of a Santa Claus vibe. Pink cheeks, small wireframe glasses, close-cropped white beard. He's recently been in the news for representing a murderer who was convicted and sentenced to death.

Scott has no idea what to expect from the meeting. But as he sits down in Cheney's office, Cheney starts explaining that he was Lou Pearlman's lawyer during the boy band lawsuits. And in a turn that should surprise nobody, Lou still hasn't paid for his services. So now Cheney is suing Lou for the $16 million that he's owed.

Oh my God. Always pay your lawyers. How is Lou getting himself into all this trouble? He just created a world of trouble for himself for literally no reason. He could have fixed this such a long time ago. Chaney tells Scott that while collecting evidence for his lawsuit, he came across a financial statement that seems fishy. He gives a statement to Scott and Scott gets right to work.

He compares it to the financial records that Lou provided to the banks to get his loans. And pretty quickly, he realizes that they don't match up. It's clear that Lou's been keeping two sets of financial records, one for when he needs money and one for when he doesn't want to pay out. And Sarah, for the record, this is bank fraud.

This is so bold to think you could get away with this for more than like two seconds, you know? I mean, he got away with it for a long time, right? Yeah, and he got really lucky with that. Well, Scott is just getting started. His research leads him to Danielle from the Office of Financial Regulation. The two of them joined forces along with an agent from the IRS. Danielle puts Scott in touch with some of Lou's victims and he hears about the ISA accounts and how Lou has avoided paying investors back.

Scott also gets in touch with Joseph's estate lawyer, and the lawyer says that Lou forged Joseph's signature on the forbearance letter that Lou sent to his family after his death. They're finally able to confirm that Lou completely made up his accounting firm. It's the most tangled web of scam upon scam imaginable, and yet it's not even really that well hidden.

We interviewed Scott, and he gave us some insight into all of this. He signed tax returns by a guy named Harry Milner, I believe. And Mr. Milner had also passed away. Well, we got tax returns that Harry Milner is signing after he's passed away. So we knew those were fraudulent, too. It was just, it was like a machine gun just full of lies.

What could you possibly be thinking to not know this would totally go to shit because so many people are involved? Yeah, I mean, Lou must have thought that he would always know how to game the system. But the evidence against him piles up very quickly. Lou knows at this point that his gravy train is at the end of its track. But hey, that's never stopped him before.

So he does what anyone with money trouble does. He opens a restaurant. As Lou's victims start to wise up, he takes solace in a booth at his newly opened restaurant, Pearl Steakhouse. It's right in the middle of Church Street Station.

Lou still hasn't finished renovations on the rest of Church Street, but he somehow managed to build a fancy eatery with his name on the door. Sarah, would you eat at Pearl Steakhouse? I mean, yeah, I would eat at any shitty novelty restaurant, as you know. But also, why is he doing this? First of all, restaurants make no money. Yeah. Second of all, he didn't even finish the renovations that he was supposed to do. Like, the simplest task ever.

Well, you're right. It was an objectively bad idea for Lou to open a steakhouse. But it also makes a sad kind of sense. Lou doesn't know what else to do but keep pretending that everything is still going great. But the reality is his empire is crumbling.

He recently settled with the Chow family, agreeing to pay them $9 million, which he doesn't have. And thanks to Helen Huntley's reporting, the rest of his investors want their money back too. And if that wasn't enough to make him sweat, he's also being sued by multiple banks over loans that he can't repay. Plus, of course, all these government people are sniffing around.

Okay, so that's the part that makes the steakhouse make even less sense. It's like he's putting up a front, but everyone knows what's going on. And it's very clear everyone knows what's going on. So who's the front for? The Lou Pearlman fans of the world? I mean, I think he was just trying to lie to himself, right? Because the thing about Lou is he's always convincing himself that another deal is just around the corner. One that'll hopefully get him out of the deep financial hole he's in.

But then he does something that makes it pretty clear he knows his options are running out. He books a business trip to Ireland to see a new boy band he might want to work with. And he doesn't buy a return ticket. Lou's delusional optimism has finally given way to reality. And now he's on the run.

Helen Huntley is still investigating loser crimes, and she's been publishing a series of articles about them in the St. Petersburg Times. Victims gather in the online comment sections of her articles to console one another over their losses, and they swap tips about what to do next. The articles have been a goldmine for Scott Skinner, the FBI agent. I could just pick up the paper in the morning and read Helen's articles, and it would give me leads with stuff to do, you know?

The leads are piling up, but Lou is still in the wind. After Ireland, he went to Germany, where he attended an awards show. And since then, he's been all over the place, heading to Spain before moving on to Panama and then Singapore. Scott hasn't been able to pin him down long enough to make an arrest.

After about five months of this cat and mouse game, Helen forwards Scott an interesting email from a reader. It's from a German guy named Thorsten Eiborg, who says that he's staying at a resort in Bali, and so is Lou.

Oh, my God. It's like, dude, you're hiding. Why are you going to a resort? I guess he was hoping no one would recognize him as the sixth member of the Backstreet Boys. Pick one, Lou. You're either as famous as them or you're not. Well, Scott makes a plan immediately. As soon as I hung up with Helen, I called our... We had an office, you know, they're called legats throughout the world in the FBI office.

And we had a league ad in Jakarta. And I called the guys there, you know, I said, hey, look, this is the white collar crime fugitive matter. You know, it's a big deal here in Orlando. Can you guys go out and run this down for me? You know, and they're like, oh, it's a white collar crime thing. I go, yeah, but it's in Bali. And they said, oh, we'll be on the next plane.

I mean, fair. I would too. I'd be like, oh, Bali? Say no more. Who do you want me to arrest? Well, Scott tells us that he still doesn't fully trust the tip. So he asks the tourists to send along a photograph of Lou. And when he does, Scott sees two familiar faces in the foreground. It turns out his agents are staying at the same hotel as Lou. And everyone is eating breakfast at the exact same restaurant.

The only problem is that Indonesia doesn't have an extradition treaty with the United States. But local officials are willing to kick Lou out of the country as an undesirable visitor. So the agents take Lou to Guam, which is a U.S. territory, and indict him on bank and wire fraud charges. After decades of stealing from investors, close friends, and even his own family, Lou is finally coming home to face the music.

In 2007, four months after Lou's arrest, a woman named Tammy Hilton visits him at the Orange County Jail. He's being held there while awaiting trial. Tammy usually dresses casually, pulling her brown hair into a ponytail and sporting jeans and t-shirts. Tammy and Lou have known each other for years. At some point, Lou starts calling her his girlfriend, but Tammy later says they were never more than friends. She feels strange visiting him in this nondescript beige building.

It's just such a stark contrast to Lou's beautiful mansion or one of the many fancy restaurants they used to go to. Now, they have to talk through a video monitor in a cinder block room.

Wow, it is actually crazy that Lou Pearlman does have one friend. I mean, he's been basically a loner throughout all this. It's so wild to think of Lou as ever having a friend at all, actually. Yeah, he just has pretty unpleasant vibes even for a scammer. Yeah, he really does. Well, today, Lou is kind of excited. He's been hinting to Tammy that he has big news. And now he's finally ready to share it.

He says he was the fall guy for a massive conspiracy that involved basically everyone in Florida. It might also be international. Could be affected by the Patriot Act. He has suspicions that Al-Qaeda is involved. They're the ones who stole all that money, not Lou. Tammy does her best to just stay upbeat. Lou tells her that she doesn't have to trust him. He has proof.

He claims that when Church Street Station was built in the 70s, the architect included a master computer that recorded every keystroke made by every other computer in the building.

When Lou bought the property, the architect clued him into the secret and made Lou's thumbprint the key. So now this master computer has all the evidence they need to prove that Lou was an innocent patsy all along. Yes, Lou's story is pretty far-fetched, but it seems like Tammy chooses to believe it. They're going to find all of the investors' money with these other evil people. Everyone will be made whole and life will go back to normal. ♪

That's not how that works. Like, come on, Lou, you can come up with better. Well, months go by and nothing changes. It's probably hard for Tammy not to start doubting him. If he had proof, wouldn't he be out by now? Then, in March of 2008, Tammy hears that Lou is taking a deal. He's pleading guilty to money laundering, bankruptcy, and investment fraud.

And she must know there is no way Lou would have taken this deal if he was innocent. Or if all of that proof he talked about had ever existed. Tammy is finally done with Lou. He's completely on his own. But he still hasn't lost hope. And you know what? He's still not ready to give up scamming.

Shifting your wardrobe from summer to fall can be challenging, but luckily, Quince offers timeless and high-quality items for any season. Yep, with Quince, your wardrobe stays fresh and in budget. They have items like cashmere sweaters from $50, pants for every occasion, washable silk tops, and so much more. Quince items are priced 50-80% less than regular brands because they partner directly with the factories to cut out the cost of the middleman.

I just ordered the super soft fleece cropped wide leg pants and the fleece crew. I got it for my mom. She loves them. She's been living in them. They're so comfortable and they're so affordable for how soft the material is. Make switching seasons a breeze with Quince's high quality closet essentials.

Go to quince.com slash scampod for free shipping on your order and 365-day returns. That's q-u-i-n-c-e dot com slash scampod for free shipping and 365-day returns. quince.com slash scampod. I feel like a legend.

After he pleads guilty, Lou reminds the judge that he was working with a boy band before he was arrested. If he could just get a couple of days of internet and phone access, he says that he could, quote, potentially reap large profits for transcontinental records and in turn, the victims. Yeah, I think if he could have done that, he would have done that already. Yes. Unsurprisingly, that request is denied almost immediately.

So in May of 2008, Lou sits in a courtroom to await sentencing. The hearing is like the worst kind of family reunion. In the past few months, many of his victims have written letters to the judge about how Lou ruined their lives. Among them was his cousin, Lois Nevler, who wrote that Lou had taken away her spirit to trust. So many of Lou's investors show up that there's barely enough room in the courtroom for all of them.

From the throng, just five are picked to testify. The first is a woman named Juanita Reynolds. She and her husband, Roger, invested millions of dollars with Lou. Sarah, can you read from what she told the judge? Yeah, she said, "'Roger was an astute businessman, and once he found out that we were scammed, tears ran down his face, and he said, "'I've lost all my self-confidence.'"

Oh my God, that is so sad. It's the saddest thing in the world. He really messed with regular people. It's not like he was just defrauding banks that can, you know, make up for it. Yeah. And Juanita isn't the only one who cries on the stand that day.

One by one, Lou's victims break down as they talk about the shame and anxiety they feel at having been duped, and in many cases, losing their life savings. And yet, these five people and all of the letter writers can't fully depict the sheer magnitude of pain and loss that Lou has created. The

The FBI investigation revealed that over the course of nearly 30 years, Lou took hundreds of millions of dollars from over 1,400 people.

Helen Huntley remembers being heartbroken for the victims. There was one really sweet guy named Monty Montgomery. I remember that, you know, he had established an award for art students in the public schools where he lived. And, you know, he could no longer support that award. He could no longer live in the place that he was living.

Yeah, all of this happening right before the financial crisis as well is just so insane. I kind of don't know how you move on from that, where it's like, of course, there's so much shame involved because you think you're making a sound investment because it's being backed up by all these people who also believe they made the right investment. Yeah. Well, the judge hands down the maximum sentence. 25 years. Lou is 53 years old at this point and not in great health, which means this could be a life sentence.

Liu pleads guilty to defrauding investors out of $300 million, though some investors claim that the real total is closer to $500 million. Either way, everyone is wondering if there's any money left. The government hasn't been able to find much, but maybe that's because it's hidden in an offshore bank account. In a last-ditch attempt to seek justice, the judge offers Liu a deal. For every million dollars Liu returns to his victims, he'll shave a month off the sentence.

But Lou never produces any of the money. And Sarah, that's probably because he spent it all. He's moved to a federal prison in Texas and spends eight years there. And then in August 2016, at 62 years old, Lou dies of a heart attack. The men he made famous are conflicted about his legacy. In a documentary called Show Him What You're Made Of, Backstreet Boy Brian Littrell says this. I mean, how can it hurt, but then you still feel sorry?

You feel sorry for the guy, but he had every opportunity to make it right, and he didn't. But many of Lou's other victims are probably not merely as forgiving. Lou's legacy is an ugly one. Everyone who got close to him got hurt in one way or another. And ultimately, he died as he lived, surrounded by secrets, lies, and betrayals of his own making. ♪

Sarah, I really took you into the dark, ugly, terrifying, shady alley where all of our favorite boy bands were made. I feel a little filthy now. It's like nothing can be wholesome. No, nothing's pure. Nothing's good. Everything's ruined if you think about it too hard. Yes, truly this was one of the crazier stories we've covered.

I guess my real question is whether this kind of scam could ever really exist again in nature. It feels like part of why he was successful was because he really did figure out how to put these boys together in these bands and market them. But the boy band craze obviously doesn't exist in the same way. Record labels don't work in the same way. And also there's the internet.

you don't always need a Svengali. Yeah, but I do think there's still so many ways to exploit musicians. I mean, it happens all the time. It happened so recently to Taylor Swift, right? Like, yeah, I do think he would have found his way into this somehow, even if it was now. Well, would you have fallen for this scheme if you were an artist trying to make it as a teenager? Yeah, definitely. I mean, like, I think he was able

able to position himself as a type of expert. And in the case of, you know, Backstreet Boys and NSYNC, like boy bands were so relatively new. It didn't seem like a scam at first. He brought them together. He showed that they definitely had talent. Like,

these guys have beautiful voices and they were really good at harmonizing. And like, they were very, very talented and he did bring them all together. So I do see how they could think like, oh, well, you know, it just starts off this way and then it gets better. Like, you know, the whole idea of having to pay your dues, which I mean, happens in jobs all the time, especially in the arts where people make it seem like you're so lucky if you have any sort of success. Yeah. Yeah.

The scam also was so much worse than just ripping people off from their money. The fact that he was accused of physically harming these kids, of touching these boys, of assaulting them, like it's not enough to take all of their money and rip them off and make them feel worthless and ruin their lives. But you also have to be a predator. Yeah.

Yeah, it's obvious that Lou Pearlman was kind of like addicted to power and seeming famous and being around attractive people. Like his whole life was so sad of just like being this shitty kid whose parents slept in the living room because he had the master bedroom to the blimp fraud to this. You know, it just seems like he was someone who really wanted to be seen as powerful and decadent.

to be seen as someone who's respected. Like, that's the only reason why someone like him would open a steakhouse while all these people are asking for their millions of dollars. Lou seemed to live in a really particular delusion of his own making. Do you think he ever really recognized what he was doing?

what he was doing or do you think he only clued in on that when he pled guilty? You know, I think about this a lot with Ponzi schemes especially because it seems like a lot of these people kind of seem to lie to themselves. They

they almost make it sound like they just kind of fell into it. Like this got so big and then I had to start doing this to make up for that. And that's like a classic Ponzi scheme. So I do think it's maybe a bit of both of him thinking that he was truly smarter than everyone because he kept doing crazy thing after crazy thing and also believing that he maybe wasn't doing something necessarily wrong or deceitful because he was going to find a way to be able to pay these people back anyway.

Well, Sarah, I think we've learned a lesson, which is that you can't trust somebody who's like really into blimps. Yes. If a man comes near you and he's like, you know what I love? Blimps, hot air balloons, steakhouses. Nope, straight to jail. What about a train guy? I won't even have a conversation with a train guy. A blimp guy, I'll say hello to, but then I will run immediately.

If you meet a man who is too interested in any means of transportation, that includes Tesla guys, no, get out of there. Run. I do agree. And it is kind of crazy how so much of his scam always came back to things in the sky. He was just trying to flee, man. He just needed a way to get out of town. And you know what he was going to do? He was going to do it in a hot air balloon. Yeah.

So long, suckers. This is So Many Strings Attached, Part 2. I'm Sachi Cole. And I'm Sarah Hagee. If you have a tip for us on a story that you think we should cover, please email us at scamfluencers at wondery dot com. We use many sources in our research, a

A few that were particularly helpful were the book The Hit Charade, Lou Pearlman, Boy Bands, and the Biggest Ponzi Scheme in U.S. History by Tyler Gray, the Vanity Fair article Mad About the Boys by Brian Burrow, the YouTube Originals documentary Boy Band Con, The Lou Pearlman Story, and the 2020 episode

The Hitman.

Our music supervisor is Scott Velasquez for Freeze on Sync. Our managing producer is Matt Gant, and our senior managing producer is Tanja Thigpen. Kate Young and Olivia Richard are our series producers. Our senior story editor is Rachel B. Doyle. Our senior producer is Ginny Bloom. Our executive producers are Janine Cornelow, Stephanie Jens, Jenny Lauer-Beckman, and Marshall Louis for Wondery. Wondery.

If you like Scamfluencers, you can listen to every episode early and ad-free right now by joining Wondery Plus in the Wondery app or on Apple Podcasts. Prime members can listen ad-free on Amazon Music. Before you go, tell us about yourself by filling out a short survey at wondery.com slash survey.