‘N Sync creator ordered to repay scam victims $300 million
July 17, 2008
It looks like the victims of scammer and boy band creator Lou Pearlman won’t have to sing Bye, Bye, Bye to their money.
This week, a US court ordered Lou Pearlman, creator of the popular boy bands ‘N Sync and Backstreet Boys, to repay as much as $300 million to the more than 1,000 people he swindled in his Ponzi scam and fraudulent investment programs.
Investigations showed that Pearlman duped several people into investing a total of $195 million into an employee investment savings program which promised 6-10% per year, but operated like a typical Ponzi scheme.
He was also convicted of defrauding investors around $70 million by selling “stocks” in two companies that largely didn’t have assets and continued doing so even after one of the companies lost incorporation.
Pearlman is currently serving a 25-year prison sentence and, because he is in jail, may find it difficult to immediately repay the victims. He is still allowed to indirectly manage a few remaining music acts, though, despite being in prison.
Still, the restitution package is surely to be welcomed by investors who lost money — unlike people who invested in previous Ponzi programs such as 12DailyPro, PhoenixSurf, FrancSwiss, PointSharExtreme, and PIPC and PFEC, who are still waiting until now for possibilities of refunds.