Inside Lou Pearlman’s Boy Band Ponzi Scheme: ‘Dirty Pop’ Revelations

Lou Pearlman poses with N’Sync Mark Weiss/WireImage

The story of boy bands like the Backstreet Boys and ‘NSync can’t be told without mentioning the late Lou Pearlman, but his influence was a mixed blessing for the musicians in his orbit.

Pearlman, who died in 2016 at age 62, was the svengali behind BSB, ‘NSync, O-Town and numerous other boy band and girl groups from the 1990s and early 2000s — but he was eventually exposed as a fraudster who scammed investors out of hundreds of millions of dollars. Netflix’s new docuseries Dirty Pop: The Boy Band Scam, released on Wednesday, July 24, dives deep into the scandal and features interviews from BSB’s AJ McLean and Howie Dorough, ‘NSync’s Chris Kirkpatrick, O-Town’s Erik-Michael Estrada and more.

“There would be no ‘NSync, there would be no Backstreet Boys without Lou, period,” McLean says early in the three-part series. “But some of us still have wounds that have never healed and may never heal.”

Both the Backstreet Boys and ‘NSync sued Pearlman after realizing he’d made himself the sixth member of each band in their contracts. They both settled with him, but that was just the start of Pearlman’s legal troubles. In 2008, he was sentenced to 25 years in prison on charges of conspiracy, money laundering and making false statements during a bankruptcy proceeding. He was still in prison when he died of cardiac arrest.

Keep scrolling for the biggest revelations from Dirty Pop: The Boy Band Scam, now streaming on Netflix:

Difficult — and Strange — Working Conditions

According to McLean, he and the Backstreet boys rehearsed in “Lou’s gondola hangar for blimps,” which he used for his Airship International business. The “godawful” space wasn’t set up to be a rehearsal studio, with no A/C and a makeshift stage that left the guys with splinters.

“We were putting in some hours,” Dorough recalled. “I don’t even know if the word ‘child labor law’ was brought into the picture. We weren’t getting paid at that time, that’s for sure.”

Why Artists Signed With Lou Pearlman

Inside Lou Pearlman Boy Band Ponzi Scheme — Lou Pearlman poses with boy band O-Town Mark Weiss/WireImage

While the guys knew that Pearlman’s offers sounded too good to be true, they were desperate for a big break — and he was offering it to them. “Lou was definitely a good salesman,” said Dorough. “He was a mastermind in showing the world how he can take almost anybody and turn them into successful groups.”

McLean noted that he and his bandmates referred to Pearlman as “Big Poppa,” as did members of his other acts. “This was this man that took us under his wing,” he recalled. “There [were] years of learning one another and experiencing things together. Some of the guys really had a deeper connection with him. Lou was like a second father to Kevin [Richardson]. Kevin lost his father to cancer.”

Kirkpatrick explained that he was especially vulnerable to Pearlman’s offers of fame and fortune given his background. He was raised by a single mom and started working at age 13. “It doesn’t matter if the contract’s written in raccoon blood. You’re signing it because it’s your deal, it’s your shot,” the ‘NSync member said. “When I met Lou was the first time that I felt some security of, like, ‘I feel like now, if my car breaks down, Lou could help out.’ I came from a trailer and he’s living in this mansion with all of this stuff and he’s got all these accolades. He must be somebody.”

Estrada, who joined O-Town after BSB and ‘NSync had already started their highly publicized legal battles with Pearlman, said he and his bandmates were wary of their new manager but still thought he had the golden ticket to success. “I’d be lying if I said that there wasn’t massive concern from us at the time, but when are we getting an opportunity like this?” Estrada said. “We saw all of these accouterments of success everywhere, and so were just like, ‘This could be ours soon. Like, this is what our life’s gonna be now. So let’s just follow him. He’s the blueprint.’”

Patrick King, who was part of the group Natural, said he and his bandmates essentially signed their contracts without reading them too closely. “It’s kind of the beggars can’t be choosers type of thing,” he recalled. “Here’s someone that we know is gonna help our career a lot, and without him nothing’s gonna happen. It could have been like, ‘You have to wear your underwear on your head every day,’ and we would have signed it.”

When They Noticed Issues

Dorough said that Pearlman’s decision to create and promote ‘NSync while he was already working with BSB was the first blow to their relationship. “We were definitely like the first child to a family that you thought you were gonna be the only child,” he explained. “We thought Lou Pearlman was our Big Poppa, as we called him. And now he’s Poppa Many Kids.”

Pearlman’s relationship with ‘NSync also wasn’t all smooth sailing after the heady early days of the band. Kirkpatrick was initially impressed when ‘NSync got a check for $10,000 — until bandmate JC Chasez asked him how much he’d previously been making as a waiter at Outback Steakhouse. “JC went and got the lawyer and we’re just standing there thinking, ‘Oh, there’s an answer to this,’” Kirkpatrick recalled. “And instead of answering, [he’s] like, taking the glasses off and rubbing the eyes for a minute, and you’re like, ‘There’s something incredibly wrong. Why are we still working our butts off for nickels and dimes and Lou’s making millions?’ That was when we realized, ‘Alright we have to do something drastic.’”

The Backstreet Boys had a similar epiphany when Brian Littrell began asking where all their earnings were going. “It took my bandmate Brian saying enough is enough for us to all truly open our eyes to what’s really being done behind our backs,” McLean said.

His Attorney’s Change of Heart

Cheney Mason, who worked as Pearlman’s defense attorney in the BSB and ‘NSync lawsuits, believed at first that his client had a right to the groups’ earnings. “The bottom line was that Lou made himself the sixth member of the Backstreet Boys and ‘NSync,” Mason said. “And so he was entitled to rewards for what he did in the creation of the group. Lou spent a lot of money training these kids. He created the Backstreet Boys, he created ‘NSync. Whether they like it or not, those are the undisputed facts.”

But Mason soured on Pearlman when he didn’t get paid for his work. “I had a contingency contract, which means that if we win an amount of money, I’m getting a percentage of it,” Mason explained. “Of the approximate $64 million that we settled on that would be owed to Mr. Pearlman, I was entitled to close to $16 million of that as our fees, and it never happened. So I was like, ‘Well, Lou, you haven’t paid me — I’m gonna sue your ass.’”

The FBI got involved at that point, and the walls began to close in.

The Pedophilia Rumors

Speculation about whether Pearlman was a sexual predator followed him before and after his death, but all the participants in the docuseries who were asked about it said they never witnessed anything like that during their time with him. “Never saw it. Wasn’t a part of my life. Wasn’t a part of my experience. However, there was some suspect behavior,” Estrada claimed. “If those things actually did happen, I feel bad for any victims and anyone who was taken advantage of.”

Kirkpatrick, meanwhile, alleged that Pearlman was inappropriate with the artists in his employ. “He’d always talk [about], ‘I need you guys in shape, whatever.’ Started coming up, grabbing our arms,” he claimed. “Then it was like, ‘Well, let me see your abs.’ You’re like a 50-, 60-year-old guy — that’s too far.”

King, who lived with Pearlman for several years, said he never witnessed anything untoward. “I’m not saying that means it never happened,” he added.

Pearlman’s former assistant Mandy Newland claimed her boss “was touchy-feely with the guys, the younger ones, especially,” but she didn’t think his behavior crossed the line.

The Beginning of the End

Helen Huntley, a journalist for the St. Petersburg Times, began to wonder what was going on with Pearlman when a reader called to ask about an ad they’d seen for one of his investment schemes. “Soon after I started writing about it, that caused this whole flood of people asking for their money back,” Huntley recalled.

Mason, meanwhile, was paid with a fraudulent check from a bank in Munich, Germany, that turned out to have the address of a vacant lot. Members of Natural and Pearlman’s friend Andy Gross also began to suspect something was wrong when Pearlman’s friend and employee Frankie Vazquez Jr. died by suicide in 2006. Shortly before his death, Vazquez had interrupted a dinner with Pearlman, Gross and the Natural guys to express his concern. “He’s like, ‘You don’t get it. You’re gonna get it,’” King recalled of what Vaquez said to them.

The Extent of the Fraud

After the FBI and the Florida Office of Financial Regulation began investigating Pearlman, it became clear just how deep his fraud went. For years, he’d claimed he owned a business called Trans Continental Airlines where he leased airplanes purchased with investors’ money — but the OFR soon discovered there were no planes at all. According to Huntley, one photo seeming to show a Trans Con plane landing on a runway was actually a model airplane held up in front of an airport, with the hand cut out of the frame.

“Pearlman was a master forger,” Mason claimed. “He would forge signatures and create false seals. … Lou Pearlman had totally false bank statements, tax returns.” Huntley went on to allege that he once created a fake accounting firm called Cohen and Siegel, named after the 20th-century gangsters Mickey Cohen and Bugsy Siegel.

A statement at the end of the docuseries notes that Pearlman stole $500 million, but only about $10 million of that money has been recovered. “Nearly 2,000 individuals and families invested with Pearlman over more than 30 years,” the statement concludes. “It was the longest-running Ponzi scheme in American history.”

How Backstreet Boys and ‘NSync Feel Now

“There were some great bonding moments with Lou, and there’s a part of me, for sure, that’ll always hold a place in my heart of gratefulness to him,” said Dorough, while McLean credited him with giving BSB the push they needed to get started in the music industry. “We truly owe, not everything, but we do owe a lot to Lou,” McLean said. “But we’ve been the ones to continue this by having loyalty to each other and a commitment to see this thing through till it’s over.”

Kirkpatrick, however, wasn’t as circumspect. “I think we should remember Lou as a crook who got what he deserved in the end, and there are people that are still in pain and hurting because of his actions,” he told the camera. “But at the same time, there was a crazy explosion of culture that started in Orlando, Florida, with an idea.”

Natural’s Michael Johnson, who remained friends and business partners with Pearlman before the fraud investigation began, broke down in tears while remembering his late manager. “In all of this, there is the success on a level that has never been seen in pop music history,” said Johnson. “But the fact that all of this was financed by people’s life savings is disgusting. And it’s only now that I can look back at that, and that’s the f–king monster — that’s the monster that was my best friend.”

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