Authorities close in on Lou Pearlman’s multimillion-dollar scam: Part 8

Artist Sean van der Wilt said he was given a house to live in but was forced to leave after learning Pearlman never made a payment on it. Investors realize they had been scammed by Pearlman.
5:01 | 12/14/19

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Transcript for Authorities close in on Lou Pearlman’s multimillion-dollar scam: Part 8
Tum tum-tum tum tums Ladies and gentlemen, please welcome Sean van Der wilt. I started getting a lot of opportunities in California. I performed at the miss usa pageant. I was the opening act at the kodak theater. it was all because I was signed with Lou. Lou Pearlman was a strong name to say, and a powerful name to say. Lou said, "Listen, we're going to get you a house in California." "Really?" "Yeah." "Oh, my god, this is amazing." Because Lou's like, "I want to get some properties out there for my artists." They took me in this house. It was beautiful. It's a $1.6 million house in Hollywood. My mortgage was $8,000 a month. I lived there for two years. The company never made one payment on it, and I had no idea. So when that house -- yeah. So, yeah. There was a lot. So everything was just fake in a way. One month we didn't get our check, so I had called there, and spoke with the woman who is in the accounts, and she said that something happened to the checks, they got shredded by mistake. And then the following month there was no check again. And that's how it started crumbling. I got a call from one of the investors who had given money to Pearlman, and they asked me about, what do I know about Lou Pearlman and trans continental airlines, and the answer at that time was nothing. I immediately thought, this is one of those unregistered securities that somebody is selling. So I decided that I would look into it some and find out more. There was an office number, and somebody would answer and they said, "Well, nobody's here anymore." And one time I called, Lou himself answered. I'm going, "Wow." He said, "Hi, Jean, I just want to tell you that everything's going great." I'm like, "What is going on?" And so I said, "Lou." I said, "I want to get some money out of my account. I want my money." He goes, "Well, how much do you need, dear?" First I said, "The whole thing." But he says, "Oh, well, I can't give that to you right now." I remember that my father-in-law said to me, "Have you seen this article by Helen Huntley that mentioned trans continental airlines?" He said, "Don't you have an investment in that?" And I said, "Yes, we do." And then I remember reading the article and people were saying that they had investments and they were trying to get their money out, but they were not having any luck getting their money out. We called our salesman, and he said, "Something is happening. But I can't talk about it now." I said, "Well, can we get our money out?" This is getting frantic. And he says, "I'll see what I can do." But then we didn't hear from him. I think they started shredding all the documents. I think that just that Helen Huntley article was the thing that said, "Oh, my gosh. Is this not legitimate?" My parents were always frugal with their money, always careful with their money, they always saved. You try to look out for them and obviously they're elderly, they don't research things. They don't know how to get on the computer and do it and I dropped the ball. You know, and I just didn't do what I should have been doing. And obviously then I went and invested my own money, so I didn't even do it for myself. And the thing was, once the house went into foreclosure, the record company called me, and they said, "Sean, we really care about you. You work so hard, you're hands-on with your career. You got to get out of that house. Lou's never made one payment on it. He's not here anymore." And I said, "I just talked to him yesterday." "No, he fled the country." It was all a facade. Everything that he was doing was a facade. Lou Pearlman was a name that I knew from living in Orlando. The mayor had given him a key to the city. He was on many of the area's most powerful lists. I knew he had started nsync and the backstreet boys. I was a white-collar prosecutor here in central Florida. In the middle of January of 2007 I learned that basically Lou Pearlman was involved in a investment scheme, and a bank fraud scheme that was probably gonna total over $400 million. About eight days after I opened up our investigation, Lou Pearlman fled the country. Sometimes defendants do something that show that they know that they're guilty. One of those things is fleeing. At that point, he had my total and complete attention.

This transcript has been automatically generated and may not be 100% accurate.

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