Lou Pearlman

Lou Pearlman was born and raised in Flushing, New York, the only child of Jewish parents Hy Pearlman, who ran a dry cleaning business, and Reenie Pearlman, a school lunchroom aide. He was a first cousin of the musician Art Garfunkel. Pearlman's home at Mitchell Gardens Apartments was located across from Flushing Airport, where he and childhood friend Alan Gross would watch blimps take off and land. According to his autobiography, Bands, Brands, & Billions, it was during this period that he used his position on his school newspaper to earn credentials and get his first ride in a blimp. This is disputed by Gross, who claims he was the school reporter, and allowed Pearlman to tag along.[5][6]

Garfunkel's fame and wealth helped inspire Pearlman's own interest in the music business. As a teenager he managed a band, but when success in music proved elusive, he turned his attention to aviation. During his first year as a student at Queens College, Pearlman wrote a business plan for a class project based on the idea of a helicopter taxi service in New York City. By the late 1970s, he had launched the business based on his business plan, starting with one helicopter.[7] He persuaded German businessman Theodor Wüllenkemper to train him on blimps and subsequently spent some time at Wüllenkemper's facilities in West Germany learning about the airships.

Returning to the U.S., Pearlman formed Airship Enterprises Ltd, which leased a blimp to Jordache before actually owning one. He used the funds from Jordache to construct a blimp, which promptly crashed. The two parties sued each other, and seven years later Pearlman was awarded $2.5 million in damages. On the advice of a friend, Pearlman started a new company, Airship International, taking it public to raise the $3 million he needed to purchase a blimp, falsely claiming that he had a partnership with Wüllenkemper. He leased the blimp to McDonald's for advertising.[5][6]

Pearlman then relocated Airship International to Orlando, Florida, in July 1991, where he signed MetLife and SeaWorld as clients for his blimps. Airship International suffered when one of its clients left and three of the aircraft crashed. The company's stock, which had once been pumped up to $6 a share, dropped to a price of three cents a share, and the company was shut down.[8]

After he took the company public in 1985, Pearlman became personally and professionally close to Jerome Rosen, a partner at small-cap trading outfit Norbay Securities. Based in Bayside, Queens, and frequently in trouble with regulators, Norbay actively traded Airship stock. This sent Airship's stock price consistently higher, enabling Pearlman to sell hundreds of thousands of shares and warrants at ever-higher prices. However, Airship was reporting little revenue, cash flow or net income. In return for keeping his penny stock liquid, Pearlman allegedly paid Rosen handsome commissions, according to a mutual friend, that reached into 'the tens of thousands of dollars' per trade.

Pearlman became fascinated with the success of the New Kids on the Block, who had made hundreds of millions of dollars in record, tour and merchandise sales. He started Trans Continental Records with the intent of mimicking their boy band business model. The record label's first band, the Backstreet Boys, consisted of five unknown performers selected by Pearlman in a $3 million talent search.[9] Management duties were assigned to a former New Kids on the Block manager, Johnny Wright, and his wife Donna.[10] The Backstreet Boys became the best-selling boy band of all time, with record sales of 130 million,[11] hitting gold, platinum, and diamond in 45 different countries. Pearlman and the Wrights then repeated this formula almost exactly with the band NSYNC, which sold over 70 million records globally.

With these two major successes under his belt, Pearlman had become a music mogul. Other boy bands managed by Pearlman were O-Town (created during the ABC–MTV reality television series Making the Band), LFO, Take 5, Natural and US5, as well as the girl group Innosense (with Britney Spears in the very beginning as a short-term member), co-managed with Lynn Harless (the mother of NSYNC band member Justin Timberlake). Other artists on the Trans Continental label included Aaron Carter, Jordan Knight, Smilez & Southstar and C-Note. Pearlman also owned a large entertainment complex in Orlando, including a recording studio he called Trans Continental Studios, and a dance studio near Disney World named O-Town.[8] In 2002, Pearlman and Wes Smith co-wrote Bands, Brands and Billions: My Top 10 Rules for Making Any Business Go Platinum.[12]

In 2006, investigators discovered Pearlman had perpetrated a long-running Ponzi scheme that defrauded investors out of more than $300 million. For more than 20 years, Pearlman had enticed individuals and banks to invest in Trans Continental Airlines Travel Services Inc. and Trans Continental Airlines Inc., both of which existed only on paper.[27] Pearlman used falsified Federal Deposit Insurance Corporation, AIG and Lloyd's of London documents to win investors' confidence in his program titled Employee Investment Savings Account, and he used fake financial statements created by the fictitious accounting firm Cohen and Siegel to secure bank loans.[6]

In a 2009 interview with Howard Stern, Rich Cronin, the former lead singer of band LFO, said that he had only received a fraction of the money owed to him from record sales. Cronin claimed that Pearlman had "wanted to bang everyone" and had attempted to seduce him multiple times. (Cronin was of age). [38]

Fellow LFO band member Brad Fischetti, however, continued to refer to Lou Pearlman as a friend, expressed sadness at the news of his arrest, imprisonment, and death.[39] Nick Carter, when asked if the claim was true, suggested that bitterness might be a motivating factor for the claim.[40] In an interview conducted by the Orlando Sentinel, former *NSYNC member Lance Bass, when asked about the claim, stated that Pearlman had never behaved inappropriately with them.[41]

In 2008, Pearlman began his prison sentence with a projected release date of March 24, 2029. However, he suffered a stroke in 2010 while incarcerated.[33] He was diagnosed with an infection of the interline of the heart valve. Pearlman had surgery to replace a heart valve a few weeks before his death. The prison took him to a hospital where he was scheduled for another surgery. Pearlman ultimately died while still in custody at the Federal Correctional Institution in Miami, Florida, on August 19, 2016, from cardiac arrest. He was buried ten days later on August 29, 2016 in the family burial area. He was 62 years old.[42]

Pearlman was featured in the third season of American Greed in the episode called "Boy Band Mogul" in 2009.[43]

The documentary The Boy Band Con: The Lou Pearlman Story premiered at SXSW on March 13, 2019. It was released on YouTube Premium in April 2019.[44][45]

On December 13, 2019, Pearlman was the subject of an episode of ABC's 20/20 titled "The Hitman: From Pop to Prison".[46][47]

• Gray, Tyler (2008). The Hit Charade: Lou Pearlman, Boy Bands, and the Biggest Ponzi Scheme in U.S. History. Harper Collins. p. 320. ISBN 978-0-06-157966-0.
• Henderson, Wes (2006). Under Investigation: The Inside Story of the Florida Attorney General's Investigation of Wilhelmina Scouting Network, the Largest Model and Talent Scam in America. Coyote Ridge Publishing. p. 511. ISBN 978-0-9687133-3-4. Cited as Henderson 2006.
• Pearlman, Lou; Smith, Wes (2002). Bands, Brands and Billions: My Top 10 Rules for Making Any Business Go Platinum. McGraw-Hill. ISBN 978-0-07-138565-7. Cited as Pearlman 2002.

• Lou Pearlman case
• Page Six Story on Pearlman
• Interview, HitQuarters Jul 2005
• The CNBC program American Greed, narrated by Stacy Keach Jr., describes, in episode #18 titled "Lou Pearlman: Boy Band Bandit," the massive fraud and Ponzi scheme, victim outrage at the federal offer to reduce Pearlman's sentence, and his proposed "Jailhouse Rock" (gag) reality series, and it also discusses the issue of sex with underage boys. Bryan Burrough, interviewed for the episode, noted of this last that he had not expected to hear about sexual improprieties, and ascribed the lack of willingness to come forward about them to Pearlman's repeated usage of the tactic of veiled threats to intimidate those who would have otherwise done so.
• Lou Pearlman at IMDb