• Victims who lost millions in Pearlman Ponzi scheme could recover a pittance


    ORLANDO, Fla. - Victims who lost millions of dollars they invested with Lou Pearlman may finally get a fraction of their money back – a very small fraction.

    WFTV learned at a hearing in bankruptcy court that the victims will see the equivalent of just four pennies for every dollar they lost.

    This comes five years after the boy band promoter pleaded guilty in one of Florida's largest Ponzi schemes that duped investors out of about $300 million.

    Pearlman's Ponzi scheme wiped out the life savings of hundreds of mom-and-pop investors.

    All but $10 million of the money Pearlman stole is gone.

    Jean Madigan said she lost nearly $200,000. She said a little is better than nothing at all.

    "I'm happy to get anything," Madigan said.

    The potential settlement was too late for some other victims.

    Pat and Connie Cesar died without ever seeing a dime of restitution.

    Pat Cesar spoke with WFTV about two years ago.

    "I got absolutely nothing," he had said.

    More than 16 of his victims have since passed away.

    "It's not a happy day, everyone wishes there had been a Swiss bank account with a $100 million in it," said Robert Feinstein, chairman of Unsecured Creditors Committee.

    The court-appointed bankruptcy trustee has been criticized for amassing millions of dollars in legal expenses, yet paying out nothing to Pearlman's victims.

    "Minus that effort, the victims would have received nothing at all," U.S. Trustee Sonett Kapila said.

    The victims said they are one step closer to getting a little justice, even if it is just a fraction.

    "He always said 'living large, living large,' he's living small now," Madigan said.

    The victims must approve the plan before it becomes final through mailed ballots.

    If the victims do approve the plan after a hearing in September, the checks go out.

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    Victims who lost millions in Pearlman Ponzi scheme could recover a pittance