Do you know who Lou Pearlman is?
For a while, he was an entertainment mogul. He reinvigorated the boy band craze in America, backing famous acts such as *NSYNC and the Backstreet Boys. No doubt he made millions doing so, but the millions he made in entertainment weren’t enough for him – he wanted more, so he decided to run an investment scheme out of Orlando.
According to the Orlando Sentinel, a court placed three of Pearlman’s business entities into receivership Friday. Trans Continental Airlines Inc., Trans Continental Travel Services Inc. and Trans Continental Enterprises LLC were all placed under the control of court-appointed receiver Jerry McHale after the Florida State Office of Financial Regulation filed an amended complaint stemming from the fact that “banks and investors” were complaining Pearlman owed them money. The same day McHale was court-ordered to his current position, Pearlman called the Sentinel to say he was flying to Germany.
Until the court can deal with all the claims being made against Pearlman’s assets, McHale’s duties are to “control, preserve and account for” the assets of the business entities he was placed in charge of. When the state initially complained about Pearlman, it estimated the complaint might be as much as $153 million. Upon “(McHale’s) first pass through,” he said the amount Pearlman may have flown away with could double that number, citing an amount as high as $317 million. That amount could make Pearlman one of the biggest fraudsters in Florida history.
Worse, Pearlman forced his own employees to invest in his schemes, according to a report by WESH 2, a news station in Orlando, who interviewed a source in Pearlman’s companies who wished to remain anonymous. The anonymous source called Pearlman “a thief,” “complete scum” and admitted that he thinks Pearlman broke the law.
If WESH 2’s source is to be believed, Pearlman could end up being a criminal in the spirit of Ken Lay and Keith Shilling of the infamous Enron scandal, who also encouraged their employees to invest in their schemes. It doesn’t seem likely Pearlman will willingly fly back to the United States in order to deal with what are only financial difficulties for now. But those financial difficulties might become criminal charges.
If Pearlman truly pulled a grab and run to the tune of $317 million, there is no excuse for it. Not for anyone, but especially not for him: He was rich anyway.