Transcript for Lou Pearlman manages more boy bands, stories of inappropriate behavior emerge: Part 7
"Making the band" was Lou Pearlman's gambit to get on TV. He wanted to create another boy band in the style of an nsync and a backstreet boys. But he wanted to do every bit of the process on television. Hey all you singers out there, Lou Pearlman, the mastermind behind such bands as lfo, nsync, and the backstreet boys is looking for five talented young men to form a new band. Thank you. It chronicled everything from how the members were selected to eventually them signing their record contract and releasing records. And that's how he creates the band O town. Jacob Underwood. Erik Estrada. Trevor Penick. When he says your name, it's just instant tears. Lou Pearlman gets this reputation as being a genius producer, as someone who put these groups together. But when you really look at it, what did Lou Pearlman know about music? I got to be a judge for one of the early rounds. And just watching him work was really interesting. He saw things that the rest of us didn't. You got to see on "Making the band," he had an ear for a good voice. But that was not the most important thing. The most important thing was charisma. Voice, you can work on. Dance, you can work on. Charisma is not a thing you can fake. If there's one thing I can say about him, he knew talent. He had a really good understanding of talent. Take your hands out of your pockets and take a deep breath. Do it one more time. Everyone's like, "Man, you created backstreet and nsync. There's no way you can do it again." And him and his crazy ambition is like, "Yeah, I can, watch me. You want to do a show and watch me do it? I'm going to show you how I do it." Our whole thing is to show what it takes to get the group prepared. Whether they become a success or not depends upon the group. One of the first things they do is, "Welcome to trans con. Here's our card. Here's all the companies we own." And you're looking at this card that folds with like 40, 50 companies that he owns. Right away, you're like, "Whoa, I mean, I am in with somebody really important. And this is a big deal. If he owns all these things, then he must really understand business." We're doing all of our rehearsals and all of our practices at the trans con facilities in Orlando, inside a grade "A" studio, top of the line, state of the art everything. We saw very quickly why these bands were so successful. It was the Yale of boy banding. 5, 6, 7, and 8. Well, the first thing I thought of when I saw "Making the band" was happening and Lou was gonna be putting together, I felt sorry for the band. Because at that point I knew who Lou Pearlman was. And I knew he was taking advantage of people. And I knew what contract these guys would eventually be signing. Everyone's talking about how Lou gives these terrible contracts, like, "Hey, make sure you know what you're getting into." It's like, "What, am I gonna not do it?" We didn't have the Lou Pearlman one-sixth member. Any of the preying aspect that he had on people, we didn't. Thank god, because we were protected by the directors, and the cameras, and all the people that were watching. And he couldn't do the same thing. But he did own our name. He trademarked o-town early on, the ownership of our name that he would hold over us and make life very difficult. That's why I say, he's very good at being shady. It was a strange situation here. He was kind of running almost a day camp and a sleepaway camp for budding young pop stars. But on the other hand, there were a lot of stories out there about how he took that too far. There were moments, but they were childlike moments. That's the thing about Lou. There was an endearing childlike quality to him. And you never automatically thought that there's something devious behind the requests. Playing chicken in the pool, "Who's going to be on my shoulders?" "You look like you're tired. Let me give you a massage. Let me see your abs. Are they coming in?" None of those things seemed weird at the time. There were a lot of questions about Lou's private life, how he interacted with these boys. There was some real creepy stories out there. As a person, he didn't seem to have relationships the same way a lot of us do. I never saw anything until after we left. Then there was rumblings, you know, maybe Lou was sleeping with boys to get into groups and all that. So I don't know what was real, what wasn't. He loved to be liked. He wanted to be liked so much. Whether that stems back from his childhood in queens, he just wanted to be liked. He's always been kind of a touchy-feely kind of guy. He would come over, put his hands on your shoulder, give you a massage, and stuff. He managed me for a little while. "C'mon over. You got to work out. And I'm going to tell this because I don't care. Come on over, work out. You got to build up your abs. There's a massage technique." Oh, really? "So here's how it goes. I go over there. He gets behind me, right hand on the right ab and left on the left and starts doing this massage. And within 30 seconds, it's a massage accompanied by heavy breathing and a little grunting. I go, "Oh, no. Now, it's not going there, is it?" I'm Sean van Der wilt. And how I know Lou Pearlman is, I was signed under his management company and his record company as a solo artist. I was flown down to Orlando, Florida. I was brought into the main hub of trans continental records and management. I just met everybody. It was really impressive. And it was like, "Oh, my god. My dreams coming true." He was always hugging you. "I've got some big plans for you boy." The first couple times he put his arm around, was hugging me but it was in a way of it just was a little too close for comfort. By the fourth time, he put his arm around me and gave me kiss on the cheek. And I was like, he's feeling a little too comfortable with me. And now I'm seeing something else. And it made me uncomfortable. It made me think other things. And then, the last time, I really shut it down. He put his arm around me and whispered something in my ear. And I didn't understand what he said. And then he goes, grabbed my face and kissed me. And I jumped up, I said, "What are you doing?" And he was like, "What are you talking about?" He's like, "We're family." The inappropriate sexual behavior was a very delicate topic. And I knew I had to broach it very carefully. His explanation was that anyone whose star he actually launched were happyith him. If their careers fizzled, they had a grudge. And that's why they said these things about him. The rumors, the whispers, the innuendo were always in the background. But Lou Pearlman never made headlines for being investigated or sued for inappropriate behavior. It wasn't until we were away from the show, people started coming up and going, "Hey, by the way, Lou's not everything he's portraying." After o-town is really about the beginning of the end, where he tried again to replicate his success with backstreet boys and nsync and others. And it just wasn't working out. Suddenly people were coming to his Orlando headquarters, knocking on the door, saying, "I can't get you on the phone. I can't get anyone to get back to me. Where's my money?"
This transcript has been automatically generated and may not be 100% accurate.