Scamfluencers - So Many Strings Attached | Part I

Episode Date: April 24, 2023

In the early 1980s, Lou Pearlman is riding high… literally. He rakes in millions of dollars from his blimp company — thanks to an insurance scam — and his private jet company is taking off, too. But Lou really starts to make the big bucks when he discovers the next big craze: boy bands. He helps turn the Backstreet Boys and N*Sync into global superstars… and his own personal cash cows. But his shady dealings will soon have the boys saying “Bye Bye Bye.”Support us by supporting our sponsors!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Hey, prime members, you can listen to scam influencers add free on Amazon music. Download the app today. A heads up to our listeners. This episode includes references to sexual harassment, abuse, and grooming. Please listen with care. Sarah, do you remember the first time you found out that boy bands were actually all created by some white guy doing open casting calls in Florida? Yeah, it's actually something I've known for a really long time because one of my older sisters was obsessed with boy bands. So it's just kind of knowledge I've had to sit with for too long. Yeah. Well, I remember feeling personally affronted by that information. And it was, for some reason, really important that I know that these boys were organic

friends and that they loved each other very much and that they were also maybe kissing after their shows. I mean, I still believe all of that. Oh, good. Okay, well, that's nice. I think it was like a manufactured chemistry, you know? That ruins it a little bit, but I've got a really good one this week. It's all about one of the swingallies that made the pop stars that I used to want to sexlessly grind up on.

So Sarah, let's go back to the 90s. It's Thanksgiving weekend, 1998. Lance Bass and his in sync bandmates are sitting with their manager, Lou Pearlman, in a private room at Lowry's stake house. Lowry's is in Las Vegas, and it's capital F fancy, with darkwood paneling and velvet covered chairs. Lance is a sweet looking kid. He has big blue eyes and bleach blonde hair. He and the rest of the guys are pretty young. They're all still in their late teens and early 20s. And right now, their group, InSync, is one of the biggest bands on the planet.

They've sold 15 million albums, and they play sold out stadiums all over the world. Tonight, they're here to eat, celebrate, and to receive their first-ever paychecks. I knew it was bad. I didn't realize they were just getting their first paychecks three years in. Yeah, I know. It sounds ludicrous. But for the past three years, the members of Insync have not been paid. Their hotels, transportation, and even their meals have all been covered by their manager,

Liu. The only money they've seen is the $35 they're given as spending money each day. The band is incredibly busy. So until recently, this setup hasn't actually seemed like a problem. Here's how Lance remembers it in an interview with Access Hollywood. I was 16 years old and we started, so I didn't really know how the business worked. So we just kind of assumed that, oh, you have to work really hard for a couple of years before that money starts accumulating

and then they just give it to you in one big check. But lately, they've been asking questions, which is probably why Lou set up this elaborate dinner to present their checks. Lou is 44 years old and he kind of dresses like a nerd and buttoned down shirts and khakis. He is thinning red blonde hair and he wears big wireframe glasses. He looks like an accountant but he's actually a boy bands fan golly.

The group he launched before in sync, a little act called the Backstreet Boys. Now Sarah, let's say you're a member of InSync in the late 90s. How much money would you be expecting? I don't know, like, some are close to a million at the very least. Yeah, that sounds perfectly reasonable, and that is also what Lance is hoping for. But then, he opens the envelope, and the check is for a measly $25,000. Damn, that's nothing. Yeah, and Lance feels25,000. Damn, that's nothing. Yeah.

And Lance feels completely blindsided. He goes back to his hotel room and rips up the check. He and his bandmates realize they've been lied to. And when they start to dig into lose business, they'll begin to unravel a scam more layered and more unsettling than they ever could have imagined. unsettling than they ever could have imagined. From Wondry, I'm Sachi Cole, and I'm Sarah Hagi, and this is Scam Fluncers.

Blue Pearl Men seemed like the ultimate success story. A kid from Queens who became a self-made millionaire and pop culture icon. Blue squeezed his boy band clients for everything they were worth. But they weren't the only people he was taking advantage of. This is part one of a two-part series that I'm calling, so many strings attached. That's it. Many involved in crypto saw Sandbankman Freed is a breath of fresh air from the usual Wall Street buffs. But in just one month, his crypto exchange would collapse.

From Bloomberg and WonderRecomes Spellcaster, a new six-part docuseries about the wild rise and fall of FTX and its founder Sandbankman Freed, listen to Spellcaster on Amazon Music or wherever you get your podcasts. Hi, I'm Lindsey Graham, the host of Wonder East Podcast American Scandal. Our newest series looks at the story of OxyContin, a popular painkiller that helps spur an epidemic

of addiction and drug abuse, in which prompted a broad campaign to hold the pharmaceutical industry accountable. Listen to American Scandal on Amazon Music or wherever you get your podcasts. Blues lifelong obsession with fame began in June of 1967. Born Queens, New York, and Lou is celebrating his bar mitzvah. His parents have booked an over-the-top banquet hall with imported crystal chandeliers dangling over hand-painted 17th century themed murals. The pro-mans are a working class family, but they always make sure that their son has whatever he wants. They've even given him the only bedroom in their modest apartment while they make do with a bed

in the living room. You know, that's how people should raise their sons. Yeah, give them whatever they want. It can't backfire. No, absolutely not. What would Lou doesn't have is friends. He doesn't play sports, and it doesn't help his reputation that he wears high-waisted polyester pants and pocket protectors. But there's one guy, Alan Gross, who's

like an older brother to him. They've grown up in the same apartment complex and have bonded over their shared love of music and blimps. They spend their time looking out of Allen's bedroom window, watching planes take off and land at the flushing airport. You know, that's boys' business. Can't relate.

Well, Sarah, unsurprisingly, most of their kids don't really share his interests. And to make matters worse, lose known around the neighborhood for bending the truth. So when he tells everyone that his cousin is art, garfunkel, of Simon and garfunkel, no one believes him. And then, Lou tells them that art is coming to his bar mitzvah. And the neighborhood kids are like, yeah, right. But Sarah, the impossible happens. Art actually shows up, and he even performs.

How, how does that happen? Is that actually his cousin? Yeah, it's actually his cousin. That's so funny. Well, the best part is that art hangs out with Lou all night. And for maybe the first time ever, Lou gets a taste of what it's like to be popular. And it turns out being rich and in the music industry

helps a lot. Lou wants more of that feeling, however he can get it. Let's fast forward about a decade. Lou's recently graduated from Queens College with a degree in accounting, but he doesn't just wanna do people's taxes all day. He has an entrepreneurial spirit, and so he approaches his friend, Allen,

about starting a business together, and it involves their boyhood obsession. Blimp's. Allen's all in. They call the company Airship International, and the idea is that they'll buy a blimp and have companies pay to advertise on it Kind of like the good year blimp. Their first client is George Ash jeans and

Around this time George Ash is everything. They sell trendy expensive denim that everyone at my brother's junior high was desperate to wear and George Ash contracts Airship to fly a blimp to a party they're having in a park in Manhattan. The plan is that when the blimp lands, fashion models wearing the latest George Ash styles will step down from the blimp and parade around the park, sipping drinks and being beautiful. What George doesn't know is that this blimp, well it's not actually a blimp. Lou actually bought a logging balloon, which is much smaller and had it reconstructed so that it almost resembles a blimp. And also, at George Ash's request, he painted it gold. Unfortunately, the gold paint has darkened in the sun to a shade that resembles poop.

And it's not just ugly, it also doesn't work. On a test flight, it crashes right by a trash dump. Luckily, the pilot makes it out fine, but the blimp is ruined. Take a look at this footage from a news clip of the crash. This is what's left of a brand new $2.5 million blimp. It crashed this morning on its maiden flight to advertise and publicize Jordash. That is truly like an Emily and Paris idea gone wrong. Oh, it's like, well paint the blimp gold and then we'll bobbah bobbah blan, you're like no, it looks like a poo, and it's not even a blimp.

Yeah, exactly. But the thing is, after the crash, Lou doesn't seem all that concern that the blimp is destroyed. And when he gets $2.5 million from an insurance payout, Alan starts to suspect that Lou wanted the blimp to crash all along. He feels completely betrayed,

and he ends up leaving airship international. But Lou's not concerned. He's gotten a taste of easy money, and he's not about to give up now. A few years after the Blimp Fiasco lose bounce back, and then some, he used the insurance payout from the Blimp crash to buy a real Blimp, and he's been leasing that Blimp to McDonald's for promotional purposes.

Now, in 1982, he's enjoying the good life. He dines at Peter Lugers, an expensive steakhouse in Great Neck, Long Island, and he goes on a spending spree. He buys a burgundy stretch limo, a blue Rolls Royce, and at the age of 28, he finally moves out of his parents' apartment and into a penthouse and a luxury building nearby.

Lose making good money, but he wants even more. So he decides to take airship international public. The IPO raises about $3 million. And after that, Lose starts spending a lot of money. Of course, he can't resist going back to the old neighborhood to show off. And it works. The kids who used to exclude him suddenly want to be friends.

And more than that, they want to buy and to lose success. We actually interviewed a former FBI agent who later investigated Lewis Business Strategy. His name is Scott Skinner, and this is what he told us. Lewis also had a method of surrounding himself with people who did not have business savvy. And they, you know, whatever he would tell them to do, they would do, not knowing whether it was right or wrong. Oh my God. I mean, of course, like, you got rich off a blimp, you know. Well, when you put it like that, in addition to selling stock and airship,

Lou also starts encouraging his former neighbors to selling stock and airship, Lew also starts encouraging his former neighbors to invest in his other company, Transcontinental. It's a private jet company, and at this point, Lew claims that Transconte owns as many as 50 jets, which he says he leases to various companies and big shots who want to fly private. He promises investors that he'll take the company public soon, just like he did with airship. On average, his old friends put in about $5,000 each. And that might not seem like a lot, but for some of them, it's their entire life savings.

Unfortunately, Transcon doesn't actually do any of the things that Lou says it does. The company does not own a single plane, and most of the money that Lou gets goes towards funding his own lavish lifestyle. So he created a company that doesn't actually do anything it says it does. He doesn't even have these plans.

No, it's just a shell. So he's lying to people about planes existing, planes that they're investing in, then they can't see. Yeah, you betcha. That's awesome. And to make it seem like everything's above board, Lou pays off his initial investors with the money he takes from his new ones.

And this, Sarah, I know you know this. This is just a classic Ponzi scheme. But the thing about Ponzi schemes is you need new scams to pay off the old ones. Luckily for Lou, he's full of ideas, Keyes are the key to the key toIC. But none of this is true. Lou takes the money people think they're putting into the investment accounts, and he uses it to purchase more businesses and pad his own wallet. But a chance encounter with a real celebrity opens his eyes to a whole new scheme,

one that will get him even closer to power, to prestige, and above all, to fame. Okay, Sarah, do you remember new kids on the block? Sachee, I know a lot of their songs. Oh, shit, really? I have two older sisters and my mom were obsessed with them. Like, I know so much of their music. I know about them. I had crushes on them. I only know about new kids on the block from Mad Magazine, because like my brother had them,

and on that I would steal them and read them, and they really hated new kids on the block. Honestly, in my opinion, solid boy band, like, I remember my sisters have like do veys with their faces on them. Yeah. Well, it's 1989. New kids on the block is one of the biggest pop bands in the world. And according to Liu, they're renting one of his planes for a gig. Liu doesn't know who these guys are, and he's kind of stunned that this group of teenagers can afford to rent one of his planes. After all, they cost $250,000 a month, but then he finds out how much money the group is breaking in,

and the dollar sign starts dancing in his eyes. Now, I'm sure you're wondering, but I thought you said Lou didn't own any planes. You're right. This cute little origin story is probably all made up. Multiple people who knew Lou during this time have said that while he did sometimes lease planes and run them out,

they never flew on anything that actually said transcontinental on the side of it. OK, so basically he was able to hook up private planes rather than lease them from his own business that he said like leased out these planes. That's what it sounds like. Yeah, it's still kind of nonsense, ultimately. But whatever the reality is,

Lewis somehow gets the idea that he can create a pop phenomenon. He's found a way to access the wealth he could only dream of as a boy, but Lou is still yearning for fame. And for that, you'll have to move to a new city and break into a whole new industry. About three years later, in December 1992, Lou and talent manager Tansy Williams are sitting in an empty blimp warehouse.

They're watching an endless parade of team boys sing and dance. Tansy's a brunette in her late 30s. She grew up performing on stage, but now she's on the other side of the business. On an episode of 2020, she recalls getting a phone call one day from a complete stranger named Lou Proman. He wanted to know if I would work with him to put a new boy group together, kind of on the lines of the new kids of the block.

And so I'm like, hell, yeah, I'm jumping on that. On this day in the warehouse, they're watching a 13-year-old kid named Nick Carter. And although he's a little young, Nick already has plenty of professional experience, including dancing with the Tampa Bay Buccaneers cheerleaders. Plus, he's adorable, and he's really talented. At one point during his audition, Nick does a cartwheel across the concrete floor. When he lands, Tancy sees him wince in pain, but he gets through the rest of the routine no problem. They only find out later that he actually broke his wrist.

And that's when Tancy knows. This kid is a pro. He gets the job. Oh God, that is so bleak. Is that dark? Like, how much pain can this kid withstand so that we can run him to the ground? Yeah. They've already picked out Tanzi's new client for the band,

14-year-old AJ McLean, and a few days after they bring Nick on, they sign another member, Howie Duro. It takes another six months to find the last two performers, cousins Kevin Richardson and Brian Littrell, and with that, the Backstreet Boys are born. I'm gonna show you a clip from their first TV appearance. Can you describe what you're seeing?

Sachi, you wanna hear what's kinda sad? Is it that you have memorized this performance by heart? I've watched this before, and I think I should reveal that I was a big, big, backstreet boy span. And I know a lot about their music. In fact, you know, it's like, they look like quintessential cute 90s boys. You know, Nick is the youngest, he's a shortest, it's adorable.

They all have like these floppy haircuts. So floppy. Wearing these different matching outfits in the first one is like leather jackets, white shirts, you know, they can be bad boys too. You know, the next know, they can be bad boys too. You know, the next one they're all wearing their like cute little different colored t-shirts and their groove and out. They're doing beautifully choreographed dances. They are working the room. And yeah, it is very much like this is our shot. I know, they're so cute, right?

And Tancy believes in them so much that she even agreed to forego her usual salary. For managing the group and co-producing with Lou, she's being paid about a hundred bucks a week plus living expenses. Lou tells her that the rest will come later. Lou forms a corporation for the band, called Backstreet Boys Inc.

Everyone gets shares. Band members, Tancyi even lose himself. And at some point, Lew actually lists himself as the sixth member of the Backstreet Boys. That way, he tells the band, they won't have to pay him as a manager. They'll just get the same salary as everyone else. At this point, Lew seems like a super rich,

successful businessman. He portrays himself as a magnanimous father figured to everyone in his life. He even asks the boys to call him Big Papa. And as he cars out a new career in the music industry, Big Papa will get even more brazen. And I feel like a legend. It's July 1993, about seven months since Lou and Tansi assembled the Backstreet Boys. Lou's up in his office, worrying about money. He estimates that he's invested around $3 million to get the Backstreet Boys off the ground.

But they haven't gotten much traction. He estimates that he's invested around $3 million to get the backstreet boys off the ground. But they haven't gotten much traction. Their biggest show so far has been at SeaWorld. But Lou's not taking in enough from his other companies to cover the bills. People are still investing in Transcon and the fake financial product he came up with. He says, But airship international isn't doing great, and Lou is strapped for cash. He needs to make cuts.

So he calls Tansi into his office, and he fires her. Tansi describes his moment later in an episode of 2020. Louperman said, Gene, you know we love you, but we really need to bring in someone who has a lot more experience in the music industry. You're always going to be family. That was my music industry. You're always gonna be family. That was my goodbye kick. He just cut me out completely.

Yeah, I mean, no surprises there. Of course he's gonna fire her. Corporations are not your friend, you know? Lou Proman, especially, is not your friend. Well, then, Lou dissolves the Florida company called Backstreet Boys Inc. The company Tanzi had a stake in. He re-incorporates the company in Delaware.

That way, he can make sure she'll never see a dime from those shares he promised her. The Backstreet Boys aren't yet the household name Lue was hoping for, but they have given him a blueprint for how he can manipulate young artists out of their fair share. So why should he change his ammo now? Instead, he gets to work on his next big project,

another attempt at pop music domination. Lance Bass cannot believe his luck. It's October 1995, and he's being picked up from the Orlando airport by a guy who drives a Rolls Royce. Lance is a junior in high school and while he's done some singing in regional shows, he didn't expect that performing would become his career. But now, this guy named Lou Perlman is show-faring Lance and his mom to lose

mansion. Lou's been working with a few kids to put together a boy band and they want Lance to be a part of it. Lance is so nervous. But when he sings together with the other boys, Justin, J.C. Chris and Joey, the sound is undeniable. They quickly assemble as a band called INSync. And then Lance learns about Luz' first band, The Backstreet Boys. They've been together for a few years now, and they're having some success in Europe. Lou seems very worried that if The Backstreet Boys find out about Insync, they'll feel betrayed. So he tells Lance and the Insync members

that they're not allowed to come to the office of their record label, transcontinental records, just in case the other boy band finds out. Wow, so Insync is the side chick. Yeah, I mean just in case the other boy band finds out. Wow, so NSYNC is the side chick. Yeah, I mean, imagine being the other woman in this scenario. And Lou also deliberately pits the two groups against one another. This is how Lance later remembers it in an interview on Access Hollywood. Back in the day, it was very scary, because Lou would tell us so many things

that they would say, which they weren't really saying, and then Lou would tell them things that we were saying, that we weren't saying. Lou has taken two big expensive gambles, and they're both about to pay off. But it turns out that he doesn't just want to make money off handsome, talented young men. Soon, questions about Lou's behavior with these teenage boys become unavoidable. His powerhouse reputation as a boy band, Sengali, is about to crumble. By the beginning of 1997,

the Backstreet Boys are finally breaking through in the US. Their big hit is a little-known song called, Quit Playing Games with My Heart. Sarah, I know you probably know this music video by heart by now, but humor me and take a look. Yeah, this was an amazing video, an absolute banger. It's a banger, you know? And it really like makes them look so harmless

and so cute and you just like, so cute. You just are like, yeah, I won't play games with your heart especially when you're dancing in the rain with your six pack. God, they really make this shit for us. They made this shit for us. And I'm like kind of freaked out right now thinking about how messed up it made me as a child. Yeah, like it really broke our brains.

We're 30 years old and we're thinking about being like eight and watching this stuff and being like, how I would never hurt you. I would never let this happen to you. Ha, ha, ha, ha. Wow, women, we sure break hearts. Well, unfortunately for the band members, the work has only intensified.

They've been on tour so long that all the days just blur together. The Backstreet Boys are a massive success. But as Kevin Richardson sits in a hotel room that looks like all the other hotel rooms he stayed in, he feels unsettled. Kevin considers Lou a mentor and he loves him like a second father, which is especially meaningful since Kevin's dad died of colon cancer six years earlier. But recently, rumors have been flying that something happened between Lou and Nick, who's still just 16.

Nick's mom, Jane, reportedly won't let Nick be alone with Lou anymore. She later told Vanity Fair that, quote, certain things happened, and that, quote, it almost destroyed her family. I tried to warn everyone, I tried to warn all the mothers. When Vanity Fair presses her for specifics, she says that she doesn't want to jeopardize her relationship with Nick or his career. Nick later says in his memoir that Lou never made any sexual advances towards him

or any of the other band members. In any case, Kevin is probably starting to look back at other moments a little differently. He and the boys have always loved spending time at Lou's Mansion. It's got video games, slot machines, a screening room, other moments a little differently. He and the boys have always loved spending time at lose mansion. It's got video games, slot machines, a screening room, and the original Darth Vader mask. Sometimes it feels like Lou is just a big rich kid,

but he can also be kind of touchy-feely. He claims he can give massages that will make it look like the boys just worked out. And that's not the only weird behavior going on at lose house. In a Backstreet Boys documentary called Show What You're Made Of, how he later says, At the end of the night, we pull in one of lose porn and we all watch those every so often. First of all, I'd seen two girls even kiss at each other, it was all one of lose video tapes.

That's classic grooming, classic abuser stuff, right? Yeah, it's definitely not normal and very shady. And, you know, I'm guessing you're a teen boy and like an older man is showing you that, you think like, oh, it's cool or whatever, but yeah, looking back, that is weird as hell. It's hard to know what to make of all of this, but one thing is clear.

Kevin and the band feel that they owe their success to Lou, and they're just beginning to become successful. But they still haven't gotten paid very much yet, just a little spending money while they're on tour. Kevin knows that there's real money coming his way at some point, but he just doesn't know when. And he doesn't want to stop the momentum to have done all this work for nothing. So he must feel like he has no choice

but to let it ride. Despite Lou's seemingly bad behavior, no one is willing to call him out on it publicly and it makes him even more emboldened. It's starting to look like there's nothing and no one who can stop Lou Perlman. It's September 1997, and Brian LeTrell is on his way to McDonald's with his backstreet bandmate Nick Carter.

They're with some other guys too, JC and Justin from Insync. Now, normally this would never happen. Lou has spent years telling Brian and his bandmates just how rude and mean the members of Insane Car. But the two bands have just finished playing each other in a charity basketball game in Germany. And they've decided to bury the hatchet long enough to get some American fast food together. Sarah, can you imagine being a teenage girl and just running into these four guys at

some random McDonald's in Germany in 1997. Oh my god. That is a fanfic. I would die. It's unreal. It is literally a story I wrote at some point in my life. Maybe I'm telling people too much about myself, but anyway, in this rare moment of camaraderie, the guys get to talking about Lou. In this rare moment of camaraderie, the guys get to talking about Lou. Brian's always questioned how much money Lou makes. And those questions only got bigger when Lou apparently had enough money to start a second band, but not enough to pay Brian and his bandmates. But now, Brian discovers that Lou isn't paying in sync either.

And that's when he goes from suspicious to pissed off. In sync and backstreet's manager at the time recalled the aftermath of that meeting in a documentary called The Boy Band Con. The next day I get on a bus with the backstreet boys and Brian gets on the bus and he goes, guess what everybody? Lou's been lying to us. When they return from tour, Brian confronts Lou. He heads into his Orlando office, walking past gold records from backstreet and in sync. They are an infuriating reminder of how much he's done for Lou and how little he's seen in return.

Here's how Brian remembers that meeting in an interview with the YouTube channel, The Seven Seas. I literally begged him physically in his office to make it right, and he didn't do it. Brian knows there's no turning back. He's got to break the news to his bandmates, so he calls a meeting. They've never made a major decision without Lou before, and now they have to make one about him. Brian's ready to sue. He knows his case will be stronger if the band presents a united front,

but the others aren't immediately on board. Here's Kevin explaining to the Wall Street Journal how he and the guys were feeling. We were just starting to break in the United States. Are we gonna stop the momentum? Our dreams are coming true. I think Brian is totally right here, like obviously if they present themselves as a united front, they will likely get what

they want. But also, it's really scary. It's like, will demanding what you want ruin your dreams? Like, I totally get them not wanting to rock the boat. Yeah, I mean, LeBand has a big decision to make. They can stay and let Lou keep soaking up all their money. Or they can try to break away, and risk losing everything they've worked so hard to build.

And I feel like I like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, like to, to, like to, like to, like to, like to, like to, to, like to, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, like, because they wouldn't be paying him as a manager. But, as a lawyer explains to Brian, that's not how it's been working. Lou has been taking in money as their manager, their business manager, their record label, and from merchandising and touring deals. The band estimates that Lou's made around $10 million off of them. Meanwhile, they've been paid just 60 grand each. I feel so bad for these guys because it's like,

you know, if this was happening now, you'd think like, oh, someone should have gotten a lawyer involved and checked this and this and this. But like at this time, there wasn't anything really like them. They were like this blueprint. This guy like formed them as a band. They're not gonna think he's gonna be stealing so much money from them in so many different ways.

Yeah. And their teenagers. Yeah, it's all new world stuff. But the band does decide to sue. Lou comes right back at them with a series of injunctions, including forcing them to immediately stop touring. Lou and the band settle out of court in 1998. We don't know much about the details of the settlement, but when it's over, Backstreet is able to sign with another management company. Still, Lou makes it out okay in the end. AJ later estimates that they have to pay out $27 million over a number of years to finally

be free of Lou. Without Backstreet, Lou's lost one of his most reliable income streams, and some of his most famous friends. Insync might not be tight with Backstreet lose lost one of his most reliable income streams and some of his most famous friends. Insync might not be tight with Backstreet, but they are aware of what's going on. And they're looking for a way out too. It's early 1999, a few months after the Backstreet boys settle out of court, the members of Insync are getting restless and beyond frustrated. Okay, so remember that disastrous dinner in Sync Hadin Vegas when they were presented with their first paychecks? Yeah, when they got their $25,000 at the fancy steakhouse after working for three

years straight. Yeah, exactly. Well, Lance comes out of that dinner convinced that something is wrong. He asks J.C.'s uncle, a lawyer, who lives in New York, to help him find someone who can read their contract and tell them what it means. J.C.'s uncle puts him in touch with a high-priced entertainment attorney. Lance later writes in his memoir that his lawyer only gets halfway through the contract before she calls him to say, Congratulations. This is the worst contract in music history.

That is insane because the music industry is notoriously predatory. Perhaps the most predatory of all entertainment industries, it's really pretty bad. While instincts contracts are very similar to the Backstreet Boys contracts, and they're disputing the same issues, here's what Lance says about the experience

in the boy band Con. The lawyers were explaining to us, well, the reason you're in debt is because, you know, they spend this money on your record pressing. Oh, all those dinners, those lavish dinners that Lou was taking you to, that you were thinking for,

that's your dinners. You were paying for it. Yeah, even that dinner at Lowry's, the one where Lou gave them their $25,000 paychecks, that was on InSync's own tab. All of Lou's supposed generosity is actually just part of the con. Eventually, the boys meet with Lou face-to-face, and in Lou's Orlando office, he breaks it down for them. They are just a business to him. All he cares about is the return on his investment.

It's a stark difference from the Lou who talked about family and called himself Big Papa. I mean, okay, sure. He only cares about the return on his investment, but he's seen crazy returns on a very small investment he made. And it's like, you can't even give him a little more to make them less suspicious of you. No, you couldn't even do that. To me, it's just like bad scamming at that point.

Still, Insync doesn't want a drawn out legal fight. So they come up with a final offer. 25% of their gross earned income for the remainder of their contract. Their lawyer thinks this is crazy. They're being way too generous. But Lou disagrees. He turns that deal down and he laughs in their faces. And the band members realize, actually,

there's nothing to talk about here. One by one, they leave the room. In sync decides to take Lou to court, and they never speak to Luda Proman again. It's November 1999. Luda sits in a Florida courtroom, sweating. Unlike the legal fight with the Backstreet Boys, which was settled behind closed doors, this battle is playing out in a courtroom.

Luda must know that the Insync boys are far more beloved than he is. Outside, groups of teenage fans are even holding hands and praying for the boys. But inside, Lou's lawyer argues that the boys in the band are replaceable. Lou came up with created and molded in sync. He could replace them with five other guys and still be just as successful.

In sync's countersuit claims otherwise. Sarah, do you want to read what our favorite J.C. wrote in his deposition? Yes, we are painfully aware that our careers may be brief. An injunction may be the end of in sync. However, we cannot work with people who have lied to us and taken advantage of us, And we will not be puppets on a string held by Lou Perlman working night and day for whatever he chooses to throw our way. Okay, I see a hip-hop song. You see it brewing.

I see it brewing, no strings attached baby. That actually is very sad. I mean, I feel like boy bands, much like pro athletes, know that they're not long for this world. And I think that's kind of what makes it extra upsetting. It's like they know they're only cute for so long. And they got all this money stolen from them. Yeah. Well, the judge is ensued by loose claims. She says her daughter has in-sing posters in her bedroom. She knows who in-sync is, and it's not Lou Perlman. It's kind of amazing.

Honestly, for years, Lou has gotten his way, and the only reason he's being taken down now is that he created a group of people who are more successful, influential, and famous than he is. The judge rejects Lou's request for a temporary restraining order against the band. And she tells him that he should settle with them and fast. Lou goes home that night and takes stock of where he's at. His boy bands have been the bulk of his income for several years now, and it's all about to vanish, just like that.

Of course, Lou still has other businesses in his portfolio. Over the years, he's acquired a TCBY yogurt franchise, a pizza shop, and chip-and-dales, amongst other companies, and the band's success has convinced even more people to invest in Transcon and its ESA retirement accounts. In part two of the series, Lou doubles down by putting together yet another boy band, a little group by the name of Otown. Plus, he takes up fraudulent bank loans and ropes in millions of dollars in bogus investments.

But not before catching the attention of an investigative journalist who starts looking into his finances, around the same time that the FBI starts their own investigation. In the stunning finale to the series, Luke Pearlman's decades-long scam will finally unravel, triggering an international manhunt. Stay tuned.

Hey, prime members, you can listen to scamFluencers, add free on Amazon Music. Download the Amazon Music app today, or you can listen to add free with Wondery Plus and Apple podcasts. Before you go, tell us about yourself by completing a short survey at Wondery.com slash survey. This is so many strings attached, part one. I'm Sachi Cole and I'm Sarah Hagi. If you have a tip for us on a story that you think we should cover, please email us at scampleincersatwondery.com.

We use many sources in our research. A few that were particularly helpful were the book The Hit Shared, Lou Proman, Boy Bands, and the biggest Ponzi scheme in US history by Tyler Gray. The Vanity Fair article, Matt About the Boys by Brian Burrow, the YouTube Original's documentary, Boy Band Con, The Lou Proman Story, and the 2020 episode The Hitman. Zan Romanov wrote this episode. Additional writing by Us, Sachi Cole, and Sarah Haggy.

Our senior producer is Jen Swan. Our producer is John Reed. Our associate producers are Charlotte Miller and Lexi Peary. Our story editor and producer is Sarah Annie. Our story editors are Allison Wyntrop and Eric Thurm. Sound designed by James Morgan. Fact checking by Will Tadlin. Additional audio assistance provided by Adrian Topia.

Our music supervisor is Scott Velasquez for Free's Uncing. Our managing producer is Matt Gantt and our senior managing producer is Tondjeet Thigpen. Kate Young and Olivia Rashard are a series producers. Our senior story editor is Rachel B. Doyle. Our senior producer is Ginny Bloom. Our executive producers are Jeanine Cornelot, Stephanie Jenns, Jenny Lauer Beckman, and Marshall Louis, for Wondry.