Creditors want to question Pearlman before sentencing

Jim Lowy and Frederick Lowe are asking the bankruptcy judge to authorize them to question Lou Pearlman before the sentencing. They say that after the sentencing, he won't have any incentive to cooperate, but the U.S. attorney's office is blocking them from interviewing Pearlman.

Comments

Sounds like your ready to sell your soul to the devil. Get Help.

See what you dont think about is he can make all the money back. He should be sentenced to time served and allowed to start a new business venture with Dave Hedrick.

9:42 THAT MAKES ONE MORON AND COUNTING

Supporters for the immediate release of Big Pop unite

[idiot canadians]

alec d. hired venable at the initial start of the company--3 years before the big man was involved. he is a wise genius.

http://smashedfrog.blogspot.com/2006/09/charlie-cristone-hot-daddy.html

Jeff is right about one thing. There was a Dateline piece on April 18, 2003 covering the model scam call "Model Behavior?" It was followed up with a second report on October 26th of that year. Neither were promotional pieces.

Dowd attended the December 2003 Fashion Rock event accompanied by Greg McDonald, as a representative of the FLAG, not as a contestant.

10:15

"then after 3 days, and after the wannabe models had plenty of time to consider the deal" - Even though their right to cancel time-line was ending before they had even paid.

"the fact is that alec d. hired venable out of washington" - Why was a lowly internet consultant doing the duties of a corporate executive?

Does the period of time Pearlman swindled people have any bearing on his sentence? Would his sentence be less if he swindled peoople for say 1 year instead of for over 20 years?

Charlie Crist, you are doing a great job, it only takes one man to blaze a trail and you are doing it. keep up the good work.

7:40 What you call freaky I call attention to detail.

I know for a fact that some of the major crooks of this scam post on this message board. The thugs read all these posts.

Posted by: | May 14, 2008 at 08:21 PM

===========================

You are right. Or they are defending their own scams, like mr Defrawy is doing in these comments masquarading as Jeff, don't be fooled. Just look at this.

Who brought the modeling affair into the discussion at the first place, May 13, 2008 at 06:25 PM, hoping to get some reaction??
'Jeff': "It was also incredibly lucky for him that the modeling company got so much attention. After all the press and accusations when the modeling company proved to be legitimate other complaints where looked at as frivolous attacks that were also baseless."

Well, some reaction he got and he was awfly happy to respond at great lengths, defending Defrawy's scams.

Then, all of a sudden, after someone posted an answer to his long post at May 14, 2008 at 01:58 PM, 'Jeff' doesn't "really see how continued discussion about the modeling company id relevant to anybody but a few people on the board who seem to steer all conversation to that topic" and wants us "try to move this dialogue onto more relevant issues about Pearlman".

Seems to me he all 'Jeff' wants is to avoid discussing the stuff 02:24 PM entered.

Quoting 02:24 PM:
Crist categorically denied having any input into the investigation or the departure of Dowd. Don't be calling him a liar now.

The business that the trustee sold, Fashion Rock LLC, consisted of only the event planning aspect of the earlier incarnations. American Idol with a $2000 try-out fee. Legal but lame opportunity to see Lou's indentured talent perform.

That's what the recordings verified.

The earlier talent companies were the ones offering the bogus web profiles, legions of unqualified, unpaid talent scouts and that "compromised" database of a thousand talent agents that didn't exist. Total scam, top to bottom.

Posted by: | May 14, 2008 at 02:24 PM

Your turn, mr Defrawy.

The more you try to make Jeff look wrong, the more desperate you look.

You try to defend yourself. what is your point? It's futile.

[it's me, y'all]

just thought i share this little bitty tiity bitty of information that anything torelli or henderson write is way off the mark. i mean sitting around a computer all day long eating stale cheetos and thinking you know everything about anything that happened in florida. the fact is that alec d. hired venable out of washington (a very top notch firm) and their main ftc fellow (who also happened to be a former ftc top bureaucrat) devised the policy for the talent scout "scouting" operations. you send out the scouts, and gawd only knows what they are saying to fat people to get them in the door, but in the door they come and have to sit down with the franchisees and listen to the terms of the program and had to sit through a videotape of the program. then after 3 days, and after the wannabe models had plenty of time to consider the deal, would call the wannabes at a pre-determined time so as not to have "high pressured sales tactics" charge against them and further to let the wannabes thoroughly to understand the program. further, alec in his evil and calculating genius, recorded the entire phone conversations. yes, the entire third day phone conversation. and why, do you ask, the henderson and torelli refuse to acknowledge this fact, well go figure what they do and how it makes them look like the silly fools they are.

[Jeff is wrong]

your dates are wrong and you are in error. dowd resigned in february of 2004. the new attorney assignment occurred after that date and the Orlando office was down to one attorny. many attorneys were assiged to cases from tampa, including kane's, the lottery case, and many others. the ag's office was getting many sanctions imposed in the kane's case, but the tampa attorneys were able to do a better job on that one too.

I know for a fact that some of the major crooks of this scam post on this message board. The thugs read all these posts.

[jeff]

You are wrong, The story was April 18, 2003. The reason I remember the body was it was the second story in the dateline episode.

Also McGregor was on the case by August 2003 because I spoke with him about the company at that time

Finally the company declared bankruptcy at the end of 2003 and Jackie was long gone.

Once again those are facts, not opinions

Unless you have the actual facts, perhaps you should not rely on your memory.

The Dateline coverage of the scam was October 26, 2003. Jackie was not given the boot, or any indication thereof, until February 2004. She left that day.

Apart from these obvious discrepancies in your "unintentional" false posting, who in the world has a "body discovery date" embedded as a focal point for recollection purposes?

You are either one freaky dude or you watch too much Court TV.

[jeff]

I didn’t say Jackie was fired two weeks after she gave the interview. I said she gave the interview two weeks after she was told not to, then fired afterwards.

And FYI, it was not a year later. The Dateline interview was late April, 2003 (the same day Lacy Petersons body was found) and Jackie left the AG’s office by August of that year. I believe she was allowed to give about 90 days notice.

I also want to add that I cannot guarantee everything I post is 100% accurate. I promise I will never knowingly post something untrue, but in many cases I am going from memory and it has been five years.

And to those saying kind words, thank you for that.

5:34: Are you saying that because you have something good to say about another, it can't be found here?

Jeff, did not post that I did, what is wrong with you people.

Jeff, you must understand, people that read this board know when you are posting positive comments to yourself, like this one

===========

Jeff, we are thankful you are here and it sounds as though some are threatened by your presence.

Jeff, we are thankful you are here and it sounds as though some are threatened by your presence.

5:20 You have no idea how we lost our money and how we feel, so why are you here?

will you please stop with the modeling, we don't care.

Ben, so are you saying that if we catch Jeff with blatant false statements, we should not make any comments attempting to point out the false statements?

Isn't this EXACTLY how you lost your money that you invested in Pearlman's companies? - you refused to hear anything negative about Pearlman that was out in public at the time you invested?

==============

Jeff. No matter what you say, there will always be those who are negative. Why don't you do like Alan Gross did, refuse to comment anymore on the blog. Maybe that will make all the negative people happy

Posted by: Ben | May 14, 2008 at 05:17 PM

Jeff, caught in another lie.

Jackie Dowd gave the Dateline interview more than a year before she was fired, not two weeks as you say.

nice try though

How could anyone believe anything you say now?

============

Crist then directed Dowd to file charges or drop the case, but until she did either to stop giving interviews. Two weeks later she gave an interview to Dateline. She was fired (asked to resign) for the interview, not the investigation.

[Ben]

Jeff. No matter what you say, there will always be those who are negative. Why don't you do like Alan Gross did, refuse to comment anymore on the blog. Maybe that will make all the negative people happy

Look for a stunt at sentencing, a job offer for $300M but he needs to stay free.

Jeff, of course you weren't directly employed by the modeling business. If you review the SEC filings for the modling business you will find that Alex Defrawy was also not directly employed, since he used his mother's consulting business to get paid by the modeling business.

nice play on words

===============

I am not an insider. I was never directly employed by any Pearlman company (modeling included). I did have some dealing on a limited basis.

2:05 I guess the only way you would have such privy information is to be behind the door or on the receiving end, which was it?

11;34 am: I wonder if you know how small you make yourself look with comments like that. You sound so pathetic, I wonder if you know?

Jeff, Most of us have NO intrest in the modeling or the 2 boys who fight constantly, my guess 8 or 9 year olds.

[jeff]

To 4:30pm,

I do not consider myself a “White Night”. As a matter of fact I initially stated the I thought the prospect of financial recovery was slight. I offered to talk to an attorney who might lend some help to some investors and he agreed – I don’t think any decent person would do less.

I am not an insider. I was never directly employed by any Pearlman company (modeling included). I did have some dealing on a limited basis.

I do not feel I am overly defensive, I feel I am objective about the whole modeling issue. I am simply looking at facts, which are stated below.

Other than that the majority of my posts provide information about the legal process which are available online.

1:19 Charlie did not make that statement I did. I am an investor a republican and believe Charlie is reaching out to help us. I do believe he is a great man sorry you can't see it.

What is relevant is the background and bonafides of the new white knight who has ridden in to save the day with offers that sound just great.

If it turns out that he is known to be full of crap there won't be the same tendency to get one's hopes up.

By your own admission you were an insider, are overly defensive of the scouting operation, are not an investor, attend court appearances, and like to denigrate any detractors.

I do hope you come through with your promises but please, don't let it be Finch. He's way too busy to help.

[jeff]

I don’t really see how continued discussion about the modeling company id relevant to anybody but a few people on the board who seem to steer all conversation to that topic.

The facts are that the modeling company was never charged or found guilty of any wrongdoing. It was found legit and sold by the trustee. Those are facts, not speculation.

Now let’s try to move this dialogue onto more relevant issues about Pearlman.

Crist categorically denied having any input into the investigation or the departure of Dowd. Don't be calling him a liar now.

The business that the trustee sold, Fashion Rock LLC, consisted of only the event planning aspect of the earlier incarnations. American Idol with a $2000 try-out fee. Legal but lame opportunity to see Lou's indentured talent perform.

That's what the recordings verified.

The earlier talent companies were the ones offering the bogus web profiles, legions of unqualified, unpaid talent scouts and that "compromised" database of a thousand talent agents that didn't exist. Total scam, top to bottom.

and 11:50 You are either two different people or posted twice and I am sure you are not one of the investors or you would make such ludicrous statements. I am not a Gay basher or evil but in this scenario the parties are gay. Who knows what Lou has on certain people as he was very good at covering his tracks buy acquiring information on those who could hurt him. No proof of anything but they were close enough to guess each others preferences. If that is the case then in this situation I am a Gay Basher.

[jeff]

It seems there has been some interests in my earlier posts. I will try to answer the questions as best I can

I can’t say why a specific entity was sued or not, but it is very difficult to sue a media outlet. Newspapers often report what someone else is saying, thus to sue them you would have to prove what the person they quoted said, not whether it was true.

An example would be if Helen reported that Les said Alec ran a scam. Helen is not reporting that Alec is a scam; she is reporting that Les said it. Thus Alec would sue Les, not Helen. There is also the old adage of do not get into a fight with someone who buys ink by the barrel (a newspaper).

Jackie Dowd

Jackie was initially the AG who investigated the modeling company. She spent almost 2 years investigating the company and did not file a lawsuit against the company. She also never subpoenaed a single document from the company (which is mind-boggling in a fraud investigation).

Jackie did give dozens of interviews to the press saying she was conducting an investigation without saying what the specific claims where. She put the company in a terrible position of not being able to defend itself or clear its name which she was tainting with the press interviews.

Crist then directed Dowd to file charges or drop the case, but until she did either to stop giving interviews. Two weeks later she gave an interview to Dateline. She was fired (asked to resign) for the interview, not the investigation.

When another AG took over the case he spent over six month investigation and found no wrongdoing.

As for the recordings, they were in place at a confirmation for customers deciding to buy. Since only a small percentage of candidates decided to purchase it was impractical to record every sales call. Customers deciding to buy were sent to an independent confirmation representative who went over the terms and made sure the customer understood and agreed to them. When someone said they were not told something and then the AG heard them confirming that specific item it did raise a concern about the conversation

I have talked to Jim Lowy on several occasions, but do not know him well. My impression was that he was interested in collecting a $1,000 fee from each investor and making a big media splash (by suing Crist).

As for what the modeling company sold for:

When the founders of the company left, Lou and his team could not run it. The over 100 franchise owners left the system and many key managers left. That caused a huge loss in value. Also the economy plays a role, Lou bought his house for over $10,000,000 and now the Trustee can’t get half its value.

Finally I have talked to an attorney and a PR firm and they are willing to provide free services to the investors. If she is willing I will speak with Helen during the sentencing and see if she would play the middle-person in setting something up.

I cannot promise that it will lead to any recovery, but you never know.

After Lou is sentenced, do you think he would like visits from his good friends the investors?

Charlie,

you should know better than to post on this blog making such comments

==============

Charlie Crist your actions are that of compassion and integrity. I believe you are a great man and you will always have my vote.

Jeff,

Most of the 2 year investigation by the FAGO of the Pearman modeling business was conducted by former Florida Assistant Attorney General Jackie Dowd, who concluded the Model Agency was fraudulent and was about to file a RICO lawsuit until she was fired. The new Flor Assistant Attorney General took a couple of week, then miraculously concluded that the whole operation was clean.

and yes, $250,000 was paid for the Fashion Rock business, but that is considerably below the $4.0 million in assets that Pearlman transferred out of the bankrupt company.

What is wrong with this picture?

===============

I am not telling you the modeling company was legitimate. The state of Florida declared it to be legitimate after a 2 year investigation and no other state or federal authority ever charged it with a crime (civil or criminal).

The Trustee when he took over Pearlman’s companies then said they were all BS except for the modeling company which he declared legitimate. He was able to sell that company to a third party for $250,000 which will go towards Pearlman’s restitution.

Those are the facts, not my opinion.

sorry previous posts from 11:07

11:27 response: I am a woman, fool. You think you are so intelligent, I certainly don't see it.

11:27 response: you are intitled to your opionion and so am I. You are angry because the facts are not on your side evil one.

Don't like gay bashing.

11;07 Either you are on drugs, or a ButtBuddy.

[Not true]

Some of Alec D's recordings last upward of an hour. The wannabees love to talk about themselves and what a gift they have. Ask the trustee---he has listened to them.

Alec D. was very wise to put into place a very sophisticated audio recording policy that recorded the entire sales transaction between the company and the wannabe models.

=======================

The sophistication - scam wise - lies within the fact that only the last, heavily scripted closing call was recorded. Not the previous calls where deception took actually place. A general flaw in telemarketing laws all over the world.

Thank you Charlie.

Charlie Crist your actions are that of compassion and integrity. I believe you are a great man and you will always have my vote.

[Crist]

Crist does know that a former deputy attorney general out of the orlando office did use other non-state citizens as a proxy to get information from the subject companies database and that Torelli knew the password to data and sent that as an email to the state in March of 2003. the password "cold fusion" and it is public record. ask the AGs office for a copy of it. It is a zip file.

[Model Citizen]

A state does not declare a business legitimate or not-legitimate unless you are talking about a gambling company or a whoring company. The wise men of Tally passed an unfair and deceptive law which does not render a company legit or non-legit, just that any material term must be discloses and you can't falsely claim certain material items that do not exist. Alec D. was very wise to put into place a very sophisticated audio recording policy that recorded the entire sales transaction between the company and the wannabe models. Any allegation for wrong doing was refuted by a contestants own voice. Please learn the sematics of words please. Or else Lenin will have won.

Jeff, do you know attorneys Jim Lowy and Frederick Lowe? Do you have an opinion about them?

Pro bono lawyers are fine in theory but a few flaky ones with chequered pasts have been on the Pearlman case and frustrated scam victims.

Just because legal help is free doesn't guarantee it is legitimate or helpful. The tendency is to assume pro bono attorneys are legit.

But they need to be investigated carefully first just like everyone else.

How do we know the attorney you have in mind is honorable, reliable, committed, and effective?

Jeff, how come Difrawi / Internet Solutions Corp never sued McAfee (rating it unsafe) and the Washington Post (naming ISC company Worldvoice News a scam)?

http://www.siteadvisor.com/sites/internetsolutionscorp.com

Taking the Bait On a Phish Scam
http://www.washingtonpost.com/wp-dyn/content/article/2007/02/09/AR2007020901925.html

Looking for a Job? Phishers Are Looking for You.
http://blog.washingtonpost.com/thecheckout/2007/02/looking_for_a_job_phishers_are.html

Jeff, why do we have this help and why are you available to us? Sorry I have trust issues. You are a gift from God.

[jeff]

Sorry, I meant to say at the plea hearing; obviously the sentencing has not happened yet.

[jeff]

At the sentencing Lou wore a size 5X prison shirt.

He looked like he gained weight if anything.

The sentencing should be a non event, LP has no defense and the only issue is will he turn over any money. The idea of LP promoting anyone is absurd, people hate him for what he has done, he has no remorse, and should pay his debt to society and receive the maximum sentence. If a pro bono lawyer can pick this up after that, many things are possable.

Most arguments on this blog are between the investors and the not.

Is Lou still a 3x size or did he slim down?

Jeff, I do not want to put out my personal info, but as you said if we could use Helen to connect then i am very interested.

If investors on this blog got along or not, we all have one common goal to be made whole. That is something we can all agree on.

If you're real...God bless you!

Thank you Jeff

[jeff]

7:52am,

I do not know how these bank account where set up. Also I am not well versed on banking law. If the banks allowed Pearlman to cut corners in moving funds around I think they could indeed find themselves with some liability.

In order to make the banks pay I think the following would be needed:

1. An organized group of elderly investors that will speak as one voice

2. A lawyer who will do this case pro-bono and nor be afraid to take on the resources of these banks

3. A strong PR campaign with reporters such as Helen supporting the investors. If the banks see a united group and see bad pr that they helped elderly people lose money they may settle.

I mentioned a lawyer who will do this pro bono because otherwise the lawyer will be accused of doing it to line his own pockets.

The problem with this case is everybody attacks and criticizes everyone else. Even Helen, the prosecutor, the trustee, and other posters get criticized. And God help the Judge if he gives Pearlman one day less than 25 years.

I know of an Attorney and a PR firm that may be willing to take on this case for free. If there is interest by the investors I will pass the name on to Helen and let her act as an intermediary.

That should probably wait till after the sentencing which is a week away.

retirement sorry about the spelling.

Jeff, did you ever meet Pearlmans half sister in Europe?

Jeff, are we subject to fines and penalties from our retiremene account even since we did not remove the money?

7:52 am, exactly.

Lou was a depositor. He was scamming the banks, all was ok with the banks as long as they were making money. They enabled and encouraged Lous fraud by their negligence.

Jeff,Please answer me this: Lets talk rollovers to Fiserv (not Trans Con) with the monies going from one bank to another where in the end no safeguards were in place to prevent Pearlman or others withdrawing what they needed when they needed it. After the processes of these exchanges the monies seemed to be washed as any withdraw of IRA is subject penalty and tax. How did all these monies disappear with no penalities or acknowledgement from the IRS? This is something that happen to many investors.

[jeff]

To 7:24am,

I do acknowledge that the banks have a higher standard to meet TO their depositors. If their direct depositors lost money because of negligence the banks would have to cover those losses.

In that the claims I have heard is that the banks should be responsible to people they had no direct relationship, thus no fiduciary duty to protect.

[jeff]

To 7:27am,

As you say, ”there is a slight but distinct difference between 'not being able to find any violations of law' and your 'declaring it legit'.”

I agree, in the case of the modeling company both happened

The state found no violations of law

The feds (trustee) declared it legitimate – so much so they operated and sold it.

While I agree with you that companies (in all states) operate illegally “under the radar” and get away with it all the time, I have never seen it happen with such publicity. The press, the feds, and at least 5 states where in a frenzy to get the modeling company. If they could have shown the slightest wrongdoing they would have come after them with a vengeance.

Sorry, the facts support a cleanly run operation.

There is a slight but distinct difference between 'not being able to find any violations of law' and your 'declaring it legit'. Fact is that there are quite a few similar marketing scams out there taking advantage of flaws in laws, especially in Florida. Just like the Wilhelmina Scouting Network aka Trans Continental Talent scam used to do and your current scams still do, mr Defrawy. True, you may get away with your deceitful business model forever. Your intimate connections with very large scale illegal spammers is a different story. Watch your back, Ayman.

Sorry Jeff, you do not acknowledge the banks have a higher standard to meet that their depositors.

[jeff]

To 12:42am

I am not telling you the modeling company was legitimate. The state of Florida declared it to be legitimate after a 2 year investigation and no other state or federal authority ever charged it with a crime (civil or criminal).

The Trustee when he took over Pearlman’s companies then said they were all BS except for the modeling company which he declared legitimate. He was able to sell that company to a third party for $250,000 which will go towards Pearlman’s restitution.

Those are the facts, not my opinion.

To 6:31am

I am not saying just because someone is appears to be successful one should do not do due diligence, I am saying it is just the way life works. To illustrate my point I’ll use the following example:

Let’s say you and a fried operate adjoining booths in a flee market. A well know and successful businessman from town goes to your friend’s booth and says he forgot his wallet, but he will pay for goods tomorrow. Your friend agrees and gives him the goods. You watching all this happen, follow suit and do the same.

Now if this person turns out to be a con man, is your friend liable for your loss as well as his? No law would say so. Your friend is liable to any partners or investors to which he owes a fiduciary responsibility.

In the same way the banks are accountable to their investors and to their shareholders for any losses they incurred for their lack of due diligence. They are not liable to others conned by the same con man.

Main Entry: due diligence
Function: noun
: the care that a reasonable person exercises under the circumstances to avoid harm to other persons or their property. I do not for a second believe the AG's office, the Banks or FISERV exercised any Due Diligence. Jeff you are saying just because someones apperars to be sucessful,the need for the banks to be diligent is simply not neccessary. You sound like a lawyer, but one I would not to ever employ.

Jeff,

Every one of the companies controlled by Pearlman turned out to be a fraud....so are you telling us that the modeling business is the only one of the dozens of companies that Pearlman controlled that was legitimate?

gee, what is it about this that doesn't make sense?

[jeff]

I do not have any direct knowledge of what Mandy or Bob are doing. I did hear about six months ago that Bob was in deep depression, terrified, and anticipating getting indicted. I heard this through the mother of his stepdaughter’s best friend.

I met Mandy a few times but I really do not remember her at all.

I have not talked to Lou since all this EISA stuff came out. He did not seem remorseful when he plead guilty. He was scanning the crowd in the courtroom, waving, and smiling to people like he was a celebrity. It was almost surreal.

Even when he was admitting guilt to the court, it seemed like he was proud of his accomplishments. He exhibited no shame and almost relished the fact that he was now accepting responsibility.

Lou will not be able to order any outside food. The only things he can have delivered to prison (through mail) are books, a musical instrument (with permission from the warden), religious items (i.e. prayer rug, rosary beads etc), glasses, and photographs.

He must eat prison food or commissary items and he must wear prison issued garb or clothes sold in the commissary (which consist of sportswear).

Can he order delivery pizza from Papa Johns on his canteen account??

Jeff, Do you know what Mandy and Bob Fischetti are up to?

Does Lou show remorse or has he expressed any, that you know of?

[jeff]

To 6:50pm,

Actually I am not incorrect about the modeling company. Not only was it not proven to be a scam it was never charged with any wrongdoing by any local, state, or federal government. In addition the state of Florida and the Trustee affirmatively declared that the company was legitimate and not guilty of any wrongdoing.

There were a few people that worked at the company that had been convicted of crimes, but that in itself is proof of nothing. Once a person has paid his or her debt to society he or she is free to do anything they like (legal activity of course).

The majority of the “conspiracy theories” come from people who initially accused the company of being a scam, then when it was cleared could not admit they had been so wrong. In truth it is not possible for a cover-up to happen at such a high level.

If Pearlman had bribed someone like Crist (as has been alleged) to cover up a “modeling scam” that would be his get out of jail free card. There is nothing the federal government drools over more than going after a high profile politician. Companies that are under a media spotlight cannot cover up crimes. Keep in mind the Enrons and Worldcoms had much more money than Pearlman and couldn’t buy their way out of prosecutions.

Jeff, thank you for explaining all of this and not leaving us in the dark, but most of all thank you for the truth and for looking for it and finding it.

Acknowledging that there is a truth and it is not all the lies and pointing fingers that has gone on here far to long towards many innocent people who did nothing wrong. Thank you again......

Jeff, I find your posted messages on Jail to be excellent.

This one however is wrong.

The modeling business was proven to be a scam operated by convicted felons. The frauds were covered up by the Florida Attorney General's Office. Had the RICO charge been allowed to be filed against Pearlman and his gang, the banks would not have loaned him the $130 million or so that was loaned in the last 2 years and never returned.

==========

It was also incredibly lucky for him that the modeling company got so much attention. After all the press and accusations when the modeling company proved to be legitimate other complaints where looked at as frivolous attacks that were also baseless.

Ben Ben Ben Ben

The approximately $500 million that Pearlman defrauded investors and banks is "net" of amounts returned to original investors - he actually took in a lot more than this.

What Trans Con business was he operating? - there wasn't any..they were all empty shell companies with no assets and no employees.

The net of it is that all of the $500 million that Pearlman defrauded individuals and banks went to him for his personal expenses or hidden several places around the world.

===============

Lou claims that out of all the money he took in, 1/3 went back to investors that wanted their interest sent them them or that wanted out before this all came apart. 1/3 went to operating Trans Con and the balance went to him.

It is true he was always a scamster, even while appearing not to be. He played constant catch-up getting more and more outragious in his deceit, until it exploded. He NEVER ran a legitimate business, it was always tainted, it was normal- for him. The banks that got fooled maybe or maybe not were to blame, the larger banks that Pearlman ran his EISA scam through are the banks with potential liability if they can be shown as accomplices, or negligent, in their facilatating this fraud by allowing themselves to be used to pull in Pearlmans millions over many many years.

[jeff]

Pearlman got away with his scam for so long by a combination of luck, unabated greed, and by knowing how to play the system.

Most Ponzi schemes unravel quickly because it is impossible to keep the money coming in fast enough to satisfy previous investors.

Pearlman got lucky on several counts:

1. He hit it big with a couple of bands and therefore had another source of cash and a ton of credibility. Most people don’t fathom that a celebrity will be running such a blatant scam.
2. He also was lucky that he lives in a society that too many people yell scam. The government has limited investigative resources and so many people file complaints that they can’t investigate every one and they are skeptical of frivolous complaints (i.e. no money lost). The fact that nobody lost money until the scam unraveled kept scrutiny away from him.

The reason he was able to fool the banks was that his Ponzi scheme showed a strong cash flow and his celebrity explained it. Imagine if Donald Trump went to a bank for a loan. The bank would assume he was legit and just do a cursory check of his loan application.

Lou had been given the key to the city twice, had hundreds of millions deposited, and was a music celebrity. I’m sure it never even occurred to the banks that he was running a scam.

It was also incredibly lucky for him that the modeling company got so much attention. After all the press and accusations when the modeling company proved to be legitimate other complaints where looked at as frivolous attacks that were also baseless.

Unfortunately I don’t think the banks will be implicated. The fact that they lost money is evidence that they were victims also. They may not have done the due diligence they should have, but Lou fooled everyone.

Sorry to be the bearer of bad news but that is just my opinion. I hope I am wrong.

Jeff, Pearlman now has a chance to make the future better at least for potential victims of ponzi schemes that use the big banks, does it not seem likely Pearlman had at least minimal inside help at one or all of these banks to keep suspicion at bay, especially regards Fiserv, Wachovia, BofA, and 5/3rd? Those potential names would be handing victims something of substance for EISA victims certainly, to serioulsy pursue, and perhaps some of the banks that were badly hurt as well. It would not surprise however, to discover the banks are willing to pay fines on occasion for being complicit or negligent in a fraud, as a cost of doing the volume of business they do.

[Ben]

Jeff. I totaly agree.

[jeff]

Ben,

Typically the government will say that an individual provided substantial assistance if he gives them information or testimony that leads to additional convictions. Usually it is lower rung people giving up “bigger fish”, but sometimes the top guy gives up a slew of people and is rewarded by the government.

The way the prosecutor looks at if he Pearlman was sentenced to 15 years and 10 others receive 5 years they have gotten 65 years versus just Pearlman doing 25 years.

In this case Pearlman has a lot going against him

1. A ton of public pressure with reporters such as Helen keeping focus of how badly Pearlman hurt people.
2. The victims in this case are very active and are communicating with the court. In many white collar cases the victims write of the crime and move on. The court will see the impact very clearly.
3. The victims are elderly, thus the loss is more harmful
4. I believe the probation report (PSI) will recommend much more than the 25 years under the guidelines. The court will feel Lou has already caught a break by being allowed to plea to the 25.
5. Finally the government doesn’t really need Lou’s testimony. They have strong cases against most of his co-conspirators and his testimony will only provide marginal value.

All that said if the government says he strongly assisted their case against others he may have 5 or 10 years reduced from his sentence.

Indecently the actual recommendation and sentence will be in months not years.

[Ben]

Jeff. Pearlman was questioned by the trustee, Soneet. Lou gave Soneet 5 pages of information such as names of people involved with Trans con. Amount of money he gave each one, list of all the real estate he invested in. Just about everything he gave to Soneet, we already had. Lou claims that out of all the money he took in, 1/3 went back to investors that wanted their interest sent them them or that wanted out before this all came apart. 1/3 went to operating Trans Con and the balance went to him. He claims there is no money anymore. no foreign bank accounts, and no money given to anyone to hold for him until he gets out. The sentencing committe requested letters from all the investors asking them explain what Lou did to them and with everyones recomendatins, they will prepare a letter on the 14th and that will be sent to the Judge to help the Judge determine the final sentence. The plea bargin calls for a maximum of 25 years, however, the judge has the final say so, the can either keep it at 25 years or change it. From the attorneys that are involved with this case, they do not feel he will get off with less than 25 years.

[jeff]

I want to provide facts instead of my personal opinion as this board has plenty of opinions.

I will say that it is very harsh for a plea deal. Most white collar plea deals involving much more money (Enron, Worldcom) where for substantially less time. Normally only convictions yield 20 years or more.

I believe Pearlman’s deal was relatively harsh by most standards because he had almost no defense. The Lay’s of the world at least had an argument that they didn’t know what was going on etc.

As I am not a victim I cannot judge if 25 years is true justice, but think of where you where in 1983. Think of how long ago that was, and imagine being in jail since then.

Also I think Pearlman’s worst punishment will be when he leaves jail. He will be almost 80 years old, have no money, and no way to make money. If he lives long enough to get out he will spend his remaining years in total misery. If you have seen the movie Shawshank redemption and remember the character that killed himself when released I believe it will be similar for Pearlman.

I don’t see him conning people as a broke 80 year old man that has been in jail for decades.

Incidentally Pearlman will actually serve slightly more than 84% of his sentence and he will be eligible for 6 months in a halfway house.

Jeff

Do you feel even 25 years is too light of a maximum sentence for what he has done?

[jeff]

Pearlman’s deal includes a provision that he has to assist the government in finding any assets and in implicating others responsible.

At the governments sole discretion they will decide whether he has provided “substantial assistance”.

If the government does in fact determine that he has provided “substantial assistance” they will make that representation in court and the judge may downward depart from the maximum sentence of 25 years.

To determine if Pearlman provided substantial assistance the government will look to see how truthful they feel he is being with them, and how much evidence he was able to provide against co-conspirators.

It is unlikely how much money they recover will have anything to do with the sentence unless the government feels he is hiding money or not being truthful.

sentencing is in 8 days on May 21

Pearlman was suppose to cooperated by revealing the location of any money he has hidden to help indemnify his investors. Has he done so?

Will he receive the maximum jail sentence if he has not cooperated?

Jeff, have you been with us the whole time this has been going on? I hope so.

[jeff]

Inmates do not have general access to computers. Some prisons offer computer classes but they do not have any access to the internet.

Lou will be able to make ten 15 minute phone calls per month. He has to pay about $.12 per minute to use the phone. Each call is recorded and may be monitored. If he is caught even attempting to run a business we will probably lose phone privileges for a period of time.

Lou may also receive magazines and newspapers (that he must pay for) and he has unlimited use of the mail (as mail is a right not a privilege the prison cannot restrict mail access). However all mail in or out is subject to monitoring (with the exception of mail from an Attorney which must clearly be marked Attorney client privileged mail) and any mail attempting to run a business will be withheld.

Jeff, Lou will not have internet access to plan an escape or bussiness? He will not be pardoned for what he has done, correct.

[jeff]

My education is in the legal field, but most of the information I posted is based on direct research.

I am happy to do my best to answer any additional questions.

Who cares, Jeff knows more about what is going on than anyone on this blog. He tells the truth and I haven't seen that, I find it refreshing.

Jeff, what are your credentials in answering these questions with such authority? Are you an authority or are you just researching?

Thank you Jeff.

Is any of this new information or more of the same.

April 28, 2008

Soneet Kapila goes after Michael Crudele

This was a long time coming, but today Lou Pearlman bankruptcy trustee Soneet Kapila sued Michael Crudele, a key figure in the EISA sales program, for recovery of fraudulent transfers. Judge Arthur Briskman signed a temporary restraining order, which prohibits Crudele and his company, Aegis Consulting, from taking any action regarding any assets transferred from Pearlman and his companies or that are the "proceeds or products" of those transfers without Kapila's authorization or court approval. He's also supposed to account to the trustee for what he's done with the property. The order is based on this emergency motion and supporting documents such as this and this.

Kapila says Crudele and his company, Aegis, got $7.5-million in the four years prior to the bankruptcy filing. Trans Continental Airlines even bought Florida Prepaid College Plans for Crudele's three children for $30,872. Also note the generous donations of $67,000 to Bell Shoals Baptist Church in 2004 and 2005. Soneet wants Crudele to give the money back. (If you read it, you'll note he makes two sets of claims, one for transfers over four years and one for transfers over two years in case the judge doesn't go along with the four years.) Who knows how much of the money has been spent. But Soneet did track down a Crudele account for $175,000 with Gries Investment Fund I LLC and there's $23,232 left in Prepaid College money. The exhibits at the back of the suit lists the transfers.

Kapila says Crudele contracted with sales agents to market the EISA program and distributed the fraudulent sales materials. "All material inquiries from investors about the operation of the EISA priogram and/or the investment and withdrawal of investor funds in the EISA program were directed to defendant Crudele."

Posted by Helen Huntley at 6:15:42 PM on April 28, 2008
in Trans Continental news | Permalink

[jeff]

I will try to answer the questions posted

Even though it is called Low Security he is still behind a double perimeter of barbed wire and is almost impossible to escape.

Lou cannot be considered a danger to society based on his charges. That is a classification for violent offenders only.

Generally Lou can eat as much as he wants in the cafeteria. The food is equivalent to a ponderosa with unlimited salad bar. He can also purchase food in the commissary (which caries about what you would find in a 7-11).

Lou will start out earning about $.12 per hour or $20 per month. He can increase that to about $1.00 per hour for working more specialized jobs (electrician, plumber etc).

His counselor will make him pay part of that towards restitution (probably $25 each quarter). There is also no limit to how much people can send him, but he is limited to about $200 per month in spending excluding special items, stamps, and phone privileges.

http://www.heraldtribune.com/article/20080512/NEWS/805120439/1661
Crists chef wants away from him...

How can he be freed when he is a threat to society and has the skills to BS everyone around him.

If Lou is placed in Low security level at the prison, should we be concerned he may be a flight risk? Why is he placed in isolation now and general public after sentencing and lastly can he eat as much as he wants?

If he is freed he could work to recover the funds for the investors and banks, just like OJ is looking for Ron and Nicole's real killer.

He is not human!!!!!!!!!!

PEARLMAN SHOULD SPEND EVERY MOMENT OF HIS REMAINING LIFE IN A STATE OF LIVING HELL FOR WHAT HE AND HIS COHORTS HAVE DONE TO US ALL. HE IS A CURSE OF A HUMAN BEING.

Thank you for communicating information to us.

[jeff]

On a typical day Lou will get up at 7am have breakfast in the cafeteria and show up to work at 7:30am. He will probably start out working in the kitchen then after a year or so be moved to a library clerk or something.

He will work till 3:30 (with 45 minutes for lunch) and then after 4:00 he will be able to spend the evening doing as he pleases. Activities include most sports and exercises, music, shop, reading, or watching TV.

He will have to be in his bunk by midnight and start the routine over again. In Lou security violence is almost non-existent.

Interesting insider info there, jeff.

Gained from personal experience?

What might be a typical day for Lou?

[jeff]

To answer both the questions below

No, Helen cannot get access to the PSI (pre-sentence investigation), they are confidential.

Lou will not get bond. He has already started serving his sentence. He will remain where he is until he is assigned by the BoP (Bureau of Prisons). He will probably be in a low or medium (most likely low) security facility. The BoP has minimum, low, medium, high, maximum, and supermax. Lou will be in a low because he will have too much time to get minimum and he is not a violent or repeat offender which would keep him out of a high or maximum. Supermax is reserved for the Tim McViegh’s and Osama bin Laden’s of the world.

Will Big Pop ask to start serving his sentence later this year and be freed on bond in the interim??

HELEN can you obtain the presentencing report of Pearlman for us?? What prison is he asking for Coleman???

IS THE POOL STILL GOING TO BE BUILT BECAUSE OF THE LACK OF PEARLMAN'S DONATION?

To all of those who obviously do not no anything about what they say:
There have been no excessive charges by the attorneys.
There are statues on the books that allow for a $100,000 payment to victims should the State want to help. This hardly covers the losses.
There is a lot more at play here than Lou. In addition to any inside help he had with regard to employees, he had to also have help on the outside.
Lou had many companies and as such from a donation standpoint are considered a PAC. Each company can donate to a campaigned individually.
If you want to spend some time Google Crist and make your own conclusions.
Charlie's gender preferences is not the issue, unless his associations with similar preferences have put him into any situation best laid to rest.
Lastly, those who only want to see their blogs in print with no time spent understanding the big picture by studying the issues, knowing what the attorneys are really doing and suggest the investors alone are at fault I can only submit that you lack any kind of moral compass.

[these two idiots]

those attorney are fools in my opinion and the US Attorney is right to keep them out with their silliness.

4:58...nice to know that it only costs $500 to buy a governor of Florida...or at least that's what is alleged here quite frequently

Or is there something more significant than these seemingly small $500 campaign contributions?

Like birds of a feather, peds of a feather also flock together.

Maybe somebody should look at the transfers of monies to Keck and then where he tranfer it too. One might find some 500 dollar donations to Crist. One might wonder from Lou or Trans Con to Keck to Crist.

There are only two ways Crist can help you

1 – Prosecute Pearlman which the federal government has done successfully

3 – Give you your money back from taxpayer funds

As taxpayers who where not duped by Pearlman we are not responsible to reimburse those that fell for Pearlman. It is not the states responsibility to protect citizens from making bad investments.

If you had made a killing investing with Pearlman you would not be asking to share the money. So please stop whining like you are the only people ever to lose money.

To: Charlie Crist

I voted for you, I am your constituent as well as many others on this blog. I did not care what your sexual preference was. I care about the way you perform your job. No doubt you have done great things for Floridians.

As a constituent we elected you to act as our agent and be our Principal. We put our faith and hopes that you will act in our best intrest.

Many are faced with disaster since Lou Pearlman has taken our capital, destroyed lives, stole from our children, their children, dreams are shattered, our retirements and savings have vanished. Lives have been taken through suicide.

I think that you were duped like the rest of us but I could be wrong. I want to believe that you are acting in our best intrest. Ignoring this situation does not mean it did not happen. It did.

If you had nothing to do with this, if you were duped say that as long as it is true. We know he fooled bank after bank, friends, family and associates. Many innocent people have also been blamed and crucified and stalked.

We came out voted and put our trust in you please give us the same respect that we showed you.

I have always heard wonderful things about your father and I don't believe the fruit falls far from the tree. Please Please help us.

Thank you.

2:00 pm, probably into "future billables" when another new retainer kicks in.

Lowy will no doubt be on this board defending himself. He should post an accounting of the fees he collected. Bet it went in "billables"

Lowy is suspect, to be sure.

None the less powerful people can make powerful enemies, it would be nice if this were about right and wrong but legal dosn't work that way. I do believe wreckless allegations are irresponsable, however if their is negligence or worse, whoever it is must take responsability. Otherwise who are we, Myanmar?

This is a shallow ploy by Lowy. Pearlman can talk to whomever he wants but it is standard that defendants would not talk to an opposing attorney prior to sentencing.

Lowy bilked the investors for $1,000 bucks a pop and is now trying to create excuses. He is as bad as Pearlman.

12:27 You nailed it. The stink flowing from the government of Florida makes me sick. If McCain chooses Crist, the Democrats have a guarantee to the White House. There is to much info out there about Crist and his gender choices not to come out. I know I will surely supply what I have. Sorry Charlie

What is Hanberg afraid of? Just a wild guess but that brings Crist and the OFR and others too close to the fire since nobody believes Pearlman will cough up any money if there even is any. Lets hope the Judge gives Lowy a crack at him. What does he have to hide?