Former boy-band promoter Lou Pearlman pleaded guilty on Thursday to federal charges of conspiracy, money fraud and false statements he made during a bankruptcy proceeding.
According to the federal prosecutors on Monday, Pearlman
sold worthless stock, used a non-existing firm, fictitious financiers from
overseas and the signature of a deceased corporate officer in order to defraud
investors and banks of over $300 million.
The charges were brought against Pearlman last summer and were detailed in a complaint long of 28 pages about the 18 years of lies and frauds.
Pearlman said in court that Pearlman's Transcontinental Airlines Inc. didn't have 41 airplanes, but only two.
He also admitted not having a German investment partner with a $50 million line of bailout capital.
In the hearing of 50 minutes Pearlman said: "I'm accepting full responsibility," the Associated Press reports.
On May 21 he will receive his sentence and he may face 25 years in prison a fine of $1 million.
He swore that he will help prosecutors locate the remaining assets and other coconspirators. However, he couldn’t explain to U.S. District Judge G. Kendall Sharp where the money was.
Pearlman said: "In different investments. Aircraft,
living expenses, working capital."
He admitted of creating a fake accounting firm in order to make business documents and tax returns for himself and his companies.
He acknowledged the fact that he used the signature of Harry Milner, a deceased former associate, in order to push off anyone seeking repayment.
Milner hadn’t worked since 1989 with Pearlman and he died in
2003.
He defrauded investors by selling “stock” for over 20 years in asset-less companies. Pearlman is best known for promoting boy bands like Backstreet boys and ‘N Sync in the 1990s. He fled the country in January 2007 as the creditors were on his tail.
He was tracked by FBI agents in