American Greed

American Greed: Unbelievable Scams and Schemes

American Greed: Scams and Schemes

Posted Jan. 15, 2010

If you've turned on a television, read a newspaper or visited an Internet news site in the last year, you've heard of Bernie Madoff, the investor sentenced to life in prison for running a $50 billion Ponzi scheme. The same is probably true for numerous other rogue businessmen like Tyco's Dennis Kozlowski and Enron's notorious Kenneth Lay and Jeffrey Skilling. But what about the smaller con men who get away with bilking investors out of millions, even billions, of dollars every year? 

We've rounded up some of the most unbelievable scams you may have never heard of over the last few years. The ones that keep the SEC and other federal investigators busy day in and day out. They may not be as notorious as the big boys, but they're all cases of American Greed.

Click ahead to see the unbelievable things some people will do for money.

Boy Band Mogul: Fame and Fraud

In 1993 Pearlman assembles five talented singers and names them “The Backstreet Boys.”  They quickly became a multi-platinum, multi-million dollar worldwide sensation.
Source: Donna Wright

In 1993, Lou Pearlman assembled five talented singers and named them “The Backstreet Boys.” Success was instant. He followed with the creation of *NSYNC ... another boy band, this one headed by Justin Timberlake. Pearlman took potential investors backstage to meet the bands. Investors were impressed and signed up, but trouble was brewing.

Boy Band Mogul: Fame and Fraud

Lou Pearlman, the legendary manager of *NSYNC and The Backstreet Boys, lives a lifestyle of fame, fortune and fraud.  He's the mastermind who scams $500 million from investors!

Lou’s boy bands begin to think the man they call “Big Poppa” is a big thief. Backstreet Manager Donna Wright can’t seem to figure out where all the money is going. The bands bring in millions … and Lou Pearlman takes most of it, ultimately scamming $500 million from investors.

Modern Day 'Bonnie and Clyde'

Matt Cox and Rebecca Hauck are a modern day version of Bonnie and Clyde. The dishonest Tampa mortgage broker and single mom team up to make millions in the real estate market.

Matt Cox and Rebecca Hauck were a modern-day Bonnie and Clyde. The Tampa mortgage broker and the single mom teamed up to make millions in the real estate market with fake identities.

Modern Day 'Bonnie and Clyde'

The U.S. Secret Service started turning up the heat by getting Cox’s image out to the public. It was a woman looking up wanted fugitives on the internet that eventually led to Cox’s arrest.
Source: U.S. Secret Service

It wasn't until the U.S. Secret Service got Cox’s image out to the public that things started heating up for the duo. It was a woman looking up wanted fugitives on the Internet that eventually led to their arrest.

In a tell-all exclusive interview with CNBC, the duo explain their $4 million mortgage fraud scam — you won't believe how easy it was.

Scientologist Turned Criminal

Photo: Santa Barbara News-Press

Reed Slatkin was a Scientology minister, but left the church in 1984 for a more lucrative career of crime.

Operating as a "trader" out of the garage of his Santa Barbara, Calif., home, Slatkin claimed to have devised a system to gain above-market returns. His clients are primarily Scientologists.

But something is amiss, and the SEC begins investigating Slatkin.

The Raid Leads to Confession

Photo: US Attorney's Office, Central District of California

He pleads guilty to mail fraud, wire fraud, money laundering and conspiracy to obstruct justice. In September 2003, Slatkin was sentenced to 14 years in prison for running what was then one of the largest Ponzi schemes in U.S. history. He scammed more than $600 million dollars from more than 800 investors.

  • Review the Case File

The Art of Fraud: Doctor Turned Con Man

Photo: Los Angeles Police Department

In 1989, Harvard-educated doctor Vilas Likhite lost his medical license for injecting patients with experimental drugs. He turned to a new life — a life of crime.  Likhite became an art dealer selling fraudulent art to the wealthy in and around Los Angeles.

The Undercover Sting

Photo: Los Angeles Police Department

Likhite sold worthless goods as valuable art treasures, making some of his acquaintances, and ultimately, the police, suspicious.

Two cops posing as businessmen ultimately told Likhite they wanted to buy some of his treasures. The hidden cameras were in place and detectives listened from the next room. The collection of fake goods Likhite claimed as part of a billion dollar collection became his undoing.

  • Review the Case File

Fraud in Cyberspace

Photo: James Cameron / MSR Realty

Barton Watson, the high-flying chairman of Cybernet, appeared to have it all: Success, money, cars. By all outward appearances, his company appeared successful, too. But in reality, it was drowning in debt. To keep afloat, Cybernet inflated its financial reports to the banks to secure loans. Staff members became suspicious. One contacted the FBI.

A Tragic Ending

Photo: James Cameron

Barton Watson and his wife Krista scammed more than $100 million from lenders and traveled the world with the proceeds. Eventually, though, Cybernet comes under intense scrutiny from federal investigators.

After embezzling nearly $500,000 from clients at E.F. Hutton, Barton Watson was slapped with a federal indictment. After five months on the lam, the FBI nab him in San Francisco.

Back at home, awaiting trial, Watson makes a desperate and haunting 911 call. He's inside with a 20-gauge shotgun pointed at his head. After three hours on the phone with an emergency dispatcher, Watson pulls the trigger.

  • Review the Case File

American Greed Marathon

  • See the Full Preview Lineup
  • American Greed Episode Guide