All language subtitles for American Greed s04e09 Sexual Performance Pill Kirk Wright

This is a CNBC original.

In this episode of American Greed, he
makes millions by hooking customers

wanting a better sex life.

The Smiling Bob campaign has to go down
as one of the more memorable of a

generation. Taking advantage of their
sexual insecurities, Stephen Warshak

illegal charges on the credit cards of
thousands of customers.

I was upset and I was angry that they
did this to her, put her in this

situation.

And later, an investment manager takes
on the toughest clients, retired NFL

players, and steals their money.

$150 million vanishes before the FBI
moves in.

We found that they only had about $200
,000 under management.

But when he's tackled for a loss, will
his game go into sudden death?

The investors, particularly the NFL
investors, were so mad at him that he

afraid for his own personal safety.

This is Bob.

Millions have seen the commercials
featuring the character known as Smiling

The ads are filled with innuendo about
why he's so happy. And, of course, by

end of the ad, you know why he's so
happy, because he's using Enzyte and

making all the women in his life very
happy.

A little more self -esteem and a very
happy Mrs. at Home.

Billing itself as the once -daily tablet
for natural male enhancement.

Enzyte wants to appear to be the herbal
answer to Viagra.

Everybody knew about Smiling Bob.

The product started to show up on the
shelves of Walmart and Walgreens and

The mastermind behind Enzyte's success
is Stephen Warshak, a 37 -year -old

entrepreneur.

His supplements business is bringing in
just shy of $250 million in revenue.

more than 50 % from the sales of Enzyme
alone.

It seems Warshak is living the American
dream, but it's all about to come

crashing down.

Warshak's story begins in Cincinnati,
Ohio in 1996.

Berkeley Nutraceuticals is hatched in
his basement.

Pretty much a shoestring operation.

They were working in a basement office.
It was him, his mom, a couple friends

from college, and they were taking
orders over the phone, running credit

People who work with Warshak attest to
his sharp business skills and say he can

be very persuasive.

I think people who worked with him will
tell you he was charismatic. They

followed him.

They believed in his vision for the
company.

Warshak vision durable to buy.

Something to enhance the lives of
millions of men without having to get a

doctor's prescription.

To get his products noticed, Warshak
plows most of his money into

Since their target was men, they would
advertise in the back of men's

And I think they have stuff in Outside
Magazine, Playboy, Penthouse.

Warshak's early ads are tasteless and
make over -the -top claims.

They were kind of crude, sometimes kind
of funny. It'll make you harder than

Chinese arithmetic.

You know, I'm sure they got some
attention from people flipping through

magazine. These early ads work well
enough, but Warshak wants to attract

customers.

Enter Smiling Bob.

The ads are eye -catching, well
-produced, and loaded with innuendo.

When it comes to wood, it always helps
to listen to an expert.

The wonders of wood are brought to you
by Enzyte.

Worsak buys time on major cable channels
and sports networks.

It gave him a credibility that the other
herbal supplement companies didn't

have. As opposed to finding it on the
back of some men's magazine, they're

seeing this thing advertised in a very
slick way on TV, not unlike the As for

Viagra and other legitimate
pharmaceuticals.

Warshak is bringing in approximately
$100 million.

He rents a large office and warehouse
just outside of Cincinnati and increases

his staff.

Besides Insight, Berkeley produces a
host of other supplements, claiming to

everything from increasing energy to
managing weight.

There's even a pill to boost women's
libidos.

But Insight is its cash cow.

Ryan first hears about Insight in 2001.

He asks that his identity be concealed.

They said it would basically increase
your size up to 24%. After a time,

the blood flow would actually increase
the size. The vessels will actually

stretch. They said most men experience
an increase in length and roundness

within three to four weeks.

The commercials promise a double your
money back guarantee if customers aren't

completely satisfied.

If you ask 99 out of 100 guys, would you
like to be bigger?

They're all going to say yes.

So, yeah, I was curious.

And I thought, well, nothing to lose.

Brian logs on to Berkley's website and
gives his credit card information.

He pays $400 for an eight -month supply
of enzyme.

Customers like Brian are keeping
Berkeley in business.

And business is good.

Very good.

The company is bringing in more than
$100 million a year.

President and CEO Stephen Warshak has
struck gold.

He had a great business sense. He was a
genius at marketing.

He knew exactly what it took to get
customers into the fold.

Warshak may know how to attract
customers, but can he keep them happy?

Brian becomes disgruntled shortly after
his shipment of enzyme arrives.

The first shipment was actually
incomplete.

They sent me only just a partial
shipment.

Brian eventually gets the rest of his
order.

But on his credit card statement the
following month, he sees Berkeley has

charged him an additional $122.

But Brian has already paid in full.

Now he is out $522.

Brian calls the company.

They said, well, sure, no problem. We'll
go ahead and process that.

The following month, it had not been
taken off, so I called them up again.

Well, it takes a while to get these
things processed.

It could be a few weeks. Third month,
same thing.

Brian calls customer service repeatedly
over the next six months before the

charges are finally taken off his credit
card.

Adding to Brian's frustration, after
taking Insight for eight months, he

it doesn't work.

I went the entire eight months, just
like they advertised.

You know, I'm willing to give them the
benefit of the doubt.

Maybe it would take longer for me, I
didn't know.

Nothing happened.

No, there's no change at all.

Brian contacts the Better Business
Bureau and learns he's not alone.

Several hundred consumer complaints have
been filed against Berkeley.

This was something of a Jekyll Hyde
operation that, you know, on one hand,

looked like a legitimate operation with
national marketing and presence on cable

TV. But at the same time, you had, with
that kind of volume of complaints, you

knew that something was wrong here.

When American Greed continues,
Berkeley's business practices attract

attention from the media and the feds.
Federal prosecutors and postal service

and the FBI, everybody started jumping
in.

They're all wondering, are customers
getting the shaft?

In 2003, 37 -year -old Stephen Warshak's
company, Berkeley Premium

Nutraceuticals, is making $100 million
in annual sales.

Its male enhancement pill, Insight, is
the top -selling sexual enhancement

supplement on the market.

From the outside looking in, Warshak
appears to be a success story.

Behind closed doors at Berkeley's
corporate headquarters, it's another

The impression of the company from an
outsider or somebody new, you think, oh,

what a nice company.

This is nice. And they pay me every
week.

John Bradley works in the call center.

All of a sudden the phones would ring
and you knew at that time that there

be an ad playing somewhere to call for
your free sample.

Because everything would light up as far
as telephone calls and noise.

Call center employees read from scripts
which explain Berkeley's so -called

continuity program.

It's an agreement stating customers will
keep receiving the product and be

billed for it unless they call to
cancel.

Once you get your free sample, if you
don't call within 30 days, you're going

get billed for a three -month supply.

We had to tell them that if...

they didn't call and cancel, they would
automatically be billed. The continuity

program is essential to Warshak's
business.

He sends numerous emails to his top
executives stating that automatic

billing is the lifeblood of the company.

Initially, John is impressed with
Warshak's business sense.

Well, he's obviously a good businessman
because the phones were ringing off the

hook. I personally thought that he was a
very bright guy, and I just thought he

was a go -getter.

Soon, Bradley is promoted to shift
leader in the customer service

That's when he starts to suspect
something isn't right at Berkeley.

Customer service reps are reporting a
high volume of calls from dissatisfied

customers.

It's got to the point you're almost on a
first -name basis with the people

calling in.

The problem?

They're getting insight, and they don't
want it.

Customers try to cancel, but their
credit cards are still being charged.

In most cases, the amounts are between
$1 to $200.

And month after month, their losses are
starting to pile up.

The continuity program has become a scam
to entrap customers.

I told Warshak, give these people
credit.

And he would say, oh, I wasn't aware.

I wasn't aware of that.

He was aware.

He knew.

But he was a real bright guy.

So I knew he knew.

Warshak attributes the botched credits
to typical growing pains of a company

that expanded as quickly as Berkeley
had.

He assures John the credits will be
taken care of. But they aren't.

Michigan residents Ellie and Bob Price
come to know all about Berkeley's

continuity program.

In 1995, 29 -year -old Ellie learns she
has to have major surgery.

She was getting cysts on her ovaries, so
she had to get a complete hysterectomy.

Ellie's surgery goes well, but as a side
effect, her hormone levels decrease,

and with them, her sex drive.

And I would just tell her, you know,
don't worry about it. It's okay. Once we

get this thing figured out with the
hormone replacement, I'm sure things

fine.

But Ellie becomes frustrated.

Then, in 2003, she hears an ad for
Avlamil on the radio, the Berkeley

that claims to boost women's libido.

Ellie orders a free one -month supply.

The lady told her this is just strictly
a sample pack to try the product and see

if she liked it, if she liked it, she
could order more after that, and that

needed the debit card number just for
shipping and handling.

But Ellie believes Avlamil does nothing.

Since she doesn't call back to order
more, she's surprised to get another

package the next month.

And the next month.

Each time, an automatic withdrawal in
the amount of $35 is debited from her

checking account.

Ellie calls Berkeley several times and
gets nowhere, so Bob steps in.

I explained the situation.

I told them that whatever they had done
was fine, that, you know, just if they

would stop sending the product, that we
wouldn't worry about it any further.

But the monthly charges keep piling up
for Bob and Ellie.

and countless other customers.

In 2003, consumer complaints against
Berkeley are building, with thousands

at the Better Business Bureau.

Cincinnati Magazine illustrates
Berkeley's troubles with a comic strip.

Berkeley was considered the worst
offender in the area of business

The uproar causes several federal
agencies to take action.

With the U .S. Postal Inspection Service
leading the way, the FDA, FBI, and IRS

team up and begin a criminal
investigation.

Their focus?

Berkeley's illegal billing practices.

Continuity in and of itself is not
illegal.

What Berkeley did was they set up a
continuity program that didn't disclose

it was a continuity program.

Berkeley sets up several roadblocks when
people try to cancel.

Callers are asked to provide
documentation of their sexual history.

When you would have to write a letter
documenting your sexual history in order

to get a credit?

Something wrong there.

Who's going to do it? You just say, ah,
forget it.

Some callers are told to contact
Berkeley's vice president of customer

Michael Johnson.

There's just one problem. Mr. Johnson
doesn't exist.

I don't know who Michael Johnson was.
Maybe there was a Michael Johnson.

I just told my people to take the call
that they were taking the calls from

Michael Johnson.

Later, I figured out there wasn't a
Michael Johnson.

In other cases, unsatisfied inside
buyers are asked to submit notarized

from their doctors.

verifying that their penises haven't
grown.

Ellie Price, who takes Berkeley's female
sex enhancement product, knows this

game all too well.

The gentleman on the phone told me that
before they could take my wife off this

supplemental treatment that I would have
to have her go to a doctor, get a

physical, and get a clearance.

And my response to him was, did you have
a doctor put her on this treatment?

Bob knows Berkley is scamming them, and
the circumstances are starting to take a

toll on his marriage.

We had a couple arguments over the
situation.

I was unhappy that she thought she had
to do something like that.

I was upset and I was angry that they
did this to her, put her in this

situation.

In 2003, Stephen Warshak and several of
his top executives are served with

subpoenas.

A short time later, Warshak begins to
raid Berkeley's coffers.

From January to November 2004, he
deposits $7 .7 million into his and

his wife's bank account and another $16
.5 million into a personal

account. He was just very arrogant about
it. Somehow or another, he thought that

he was going to get through it all and
be able to pick up where he left off.

and that these charges would magically
go away.

When American greed returns, will
Warshak and his arrogance be able to

prison?

On March 16, 2005, with a search warrant
in hand, 50 armed agents from the U .S.

Postal Inspection Service, FBI, IRS, and
FDA descend on the headquarters of

Berkeley Premium Nutraceuticals.

They brought in a number of trucks. They
loaded a large number of boxes of files

and computers and hard drives and hauled
them off to a secure location.

Officials removed seven tons of
evidence, including 24 laptops, computer

drives, marketing plans, even the
unopened mail.

In all, the government takes 13 ,500
documents.

The raid results in a 112 -count
indictment against Warshak and his top

September 2006.

Fourteen of the company's executives,
including Warshak, his mother, his

and his brother -in -law, are charged
with federal crimes including fraud and

money laundering.

Federal authorities believe that between
2001 and 2006, Warshak and his top

execs took $100 million without
customers' consent by repeatedly billing

credit cards for refills they didn't
order.

I think in the eyes of the government,
the company went beyond just making it

difficult for people.

It directly tried to mislead people. It
went to great lengths to keep people

from returning product.

And most importantly, it went in and
took charges on people's credit cards

without permission.

And that was a huge problem for them to
get past.

In January 2008, Stephen Warshak goes on
trial.

It's one of the biggest consumer fraud
cases in Ohio history.

Warshak's lawyers assert that all
charges can be attributed to mistakes

when a company grows from zero to $200
million in less than eight years.

And Warshak's entire argument was that
this company was growing so fast, we

couldn't keep up with some of the
problems that were developing.

We did our best. We worked hard to fix
it. But sometimes we didn't quite do as

well as we should have done.

I don't think that you accidentally
start ripping people off and scamming

I think that that's what he created, and
that's what he intended to do.

In the end, it's a mountain of damning
emails, impossible to defend, that would

ultimately bring Warshak down.

In one email...

Warshak writes, I don't care if the card
is taken from Grandma's purse so Junior

can buy some insight. If the card is
good, I want a ship.

But the most damning email is written by
Warshak's nephew, Jason Cosman.

In it, Cosman sketches out a plan for
wringing yet more money out of

He suggests that after customers cancel
their orders, Company reps call them

back pretending to represent a hospital
offering a cheaper and more effective

product. The poor customer bites, Kosman
writes, thinking he's getting a better

deal, but he's actually getting taken
for a second time.

Kosman goes on to write, the scheme is
beautiful.

Dreamed it up after many a bong hit one
night. These customers are fish in a

barrel, man.

Exploit their shit out of them.

This is what the company was about. It
wasn't about selling a product. It was

about exploiting people.

Warshak has forwarded the email to five
Berkeley employees.

In the subject line, he's written, The
student has become the teacher.

Our company was built on this kind of
creative thinking.

Thanks for the wake -up call, Jason.

At trial, his defense team argues
Warshak forwarded the email to others as

joke. I think the issue for...

Federal prosecutors became, you know,
this is in the middle of all of this,

know, uproar going on about the company,
and yet he's still telling people that

this is the kind of thinking that we
want to embrace.

The prosecutors made a pretty strong
case that his actions supported what he

said in that email.

On February 22, 2008, Stephen Warshak is
convicted on 93 counts of conspiracy,

fraud, and money laundering.

Judge Arthur Spiegel, who presides over
the case, says Warshak was motivated by

greed.

The judge made a point to say that not
only is he taking money from people, but

he's preying on their insecurities.

And that seemed to bother the judge,
that this was something that he knew he

could exploit.

While most of his top executives have
gotten one - to two -year sentences,

Warshak doesn't get off nearly so
easily.

He's ordered to pay $494 million in
forfeiture, and he's sentenced to 25

years in federal prison.

25 years is a long time, especially,
again, when you consider that no one

everything. You know, nobody lost a
fortune here. Nobody went bankrupt. But

was petty theft on a massive scale.

Michigan residents Bob and Ellie Price
never recovered their losses, but for

Bob, it wasn't just about the money.

The money wasn't really the thing that
motivated me. It was the way I was

treated by these people, and it was what
they did to my wife.

Berkeley customer Brian decides to take
his fight one step further. He takes

part in a class -action civil lawsuit
against Berkeley.

The company ends up settling for $4 .7
million.

I was awarded $17 ,000.

I'm glad they had to pay me. I'm glad
they had to pay the other people in the

class. You know, they're counting on
people putting their money down and not

saying anything about it.

I actually decided to stand up to these
guys and say, hey, this is wrong.

I don't care what kind of embarrassment
I have to go through. I'm going to get

my money back from you guys.

Enzyte is still on the market. The
product itself was never deemed harmful

consumers, just Berkeley's business
practices.

A new company called Byanda has
purchased Enzyte.

And smiling Bob, he's still on the air
eliciting chuckles.

Looks like it's all first class from
here.

And helping to rake in millions.

Atlanta, southern boomtown, where people
know how to enjoy the finer things in

life.

But even here, the lavish wedding party
thrown by hedge fund superstar Kirk

Wright was a bit over the top.

There were, you know, bars carved out of
ice, three of them, where you could

have champagne and lobster and sushi and
everything else in the world.

The reception goes on even as Wright's
hedge fund is on the brink of collapse.

Only a sociopathic personality can
conduct himself in that manner.

The wedding party is Kirk Wright's last
tango.

When Wright exits the stage, he leads
the FBI on a national manhunt.

Kirk Wright grows up in the Bronx, New
York.

It was clear that he was sort of an
individual who had pulled himself up by

bootstraps. He wasn't born into
affluence or anything like that.

He came into a little bit of money
because, unfortunately, he had a bad car

wreck.

And there was a settlement from that.

And he initially started investing that
money when he was 19 and 20.

The settlement from the car wreck also
helps put him through graduate school.

He gets a master's degree from Harvard
in 1995.

A year later, Wright forms International
Management Associates, or IMA, to

operate hedge funds.

Calvin Paris, the father of one of
Wright's Harvard classmates, invests

,000 with Wright in November 1999.

That got into his investments for the
month of December.

And when I got my monthly market value
for December, I had $145 ,000.

An unbelievable increase in one month.
The market is hot, but Wright's return

astronomical. Wright's financial prowess
does not go unnoticed.

He got introduced through mutual friends
and investors to these two guys in

Atlanta who were anesthesiologists.

who had an entrepreneurial bent and were
looking for a place where they could

branch out a little bit more from the
business of being doctors.

Within a year, the two anesthesiologists
are not only invested, they persuade

Wright to relocate to Atlanta.

The city had grown by a third in
population from 1990 to 2000.

There was a lot of business opportunity,
but there was a very high cultural

comfort level for people who were black
and young professionals.

As it turns out, the 30 -year -old is in
the right place at the right time.

There was a lot of money to invest.

There were relatively few hedge funds,
and very, very few that were run by

African Americans.

So in some ways, there was a need that
was just waiting to be met here by

somebody like Kirk Wright.

The two doctors use their contacts to
tap professionals like themselves,

with ample wealth and little time or
expertise to manage it.

So when people like Mr. Wright are able
to come to him and use terms, you know,

margin calls and short sales and options
trading, and throw out the big word,

the person's heard that word before,
they might not completely understand it,

but they think, well, he's using the
right terms.

But even savvy investors get hooked as
well.

In 2001, Los Angeles -based real estate
developer Roger O 'Neill agrees to meet

with Wright.

He seemed like a very knowledgeable,
articulate guy, and he told me a little

about his background, that he was from
Harvard.

By the end of year 2002, I had pretty
much liquidated most of my portfolio

my investment group and transferred it
over to International Management &

Associates.

Eventually, O 'Neill has $13 million in
IMA accounts.

Little do he and other clients know, a
portion of their money is being drained

off. An enormous amount of money, over
$10 million, was basically the

defendant's own personal checkbook.

That's what the defendant was living out
of, this so -called expense account.

But Wright appears to deliver the goods.

Statement from his Taurus Fund.

Trumpet annual returns as high as 20%.
Returns that high attract plenty of

attention. Wright continues to work his
game.

Mr. Wright was able to get two NFL
football players who were retired to

work for him.

And this led to them going out and
getting some of their friends that were

the NFL to also invest.

One of Wright's new hires is former
Denver Bronco defensive star Steve

He convinces other players to buy in,
and Wright does the rest.

None of the NFL players involved would
talk to American Green.

The experience with IMA is an
embarrassment they want to put behind

Up next, what happens when football
players get ripped off?

Kirk Wright is about to get blitzed.

Atlanta hedge fund manager Kirk Wright
is building a financial empire.

He claims to have a secret recipe for
stock market success, but he's not

his investors what it is.

And that's the classic conundrum of
hedge funds.

How much transparency do you have to
have for your investors versus giving

your secrets?

International Management Associates
grows to $84 million.

All under Kirk Wright's personal
management.

He lavishes attention on investors and
potential clients.

He was spending a ton of money on travel
and entertainment type expenses.

flying people out for football games
here at the Georgia Dome, showing them

he was a successful businessman.

He is spending on himself, too. There is
a new house for his wife and son.

When they purchased it, the front looked
about like it does now. However, the

entire back 20 feet or something did not
exist.

And they spent five and a half years
adding on to the house.

Building the pool and a great deal of
work. They added marble floors, gold

fixtures.

His garage is filled with luxury cars.

A Bentley, a Jaguar, an Aston Martin, a
BMW, and a Lamborghini.

It's an almost cartoonish version of
modern success.

But his home life is not picture
perfect.

In 2003, his wife files for divorce and
leaves with the boys.

She says that Kirk has changed, and she
doesn't want to be a part of this new

life.

On the business side, some clients are
wary of Wright as well.

Calvin Paris asks a lawyer to evaluate
him.

He came into the office with Kirk, and
he walked out feeling that everything

okay. I came away with reassurance.

of any doubts that I have. But Wright is
covering market losses with cash from

new investors.

To keep IMA's statements looking solid,
he resorts to something beyond creative

accounting. He just made them up. He
just took a template off of the Internet

that the brokerage companies provided to
the investors so that you could track

your own investments.

He filled it out, sent those in, and
passed them off as actual statements.

According to the government, Wright's
employees aren't running the scam.

They talk him into letting them form a
more transparent division of the

During its creation, an accountant
uncovers something shocking.

While Wright was reporting more than a 3
% gain in two of his funds, the company

had actually lost value to the tune of
24%. The staff demands answers.

The core group of anesthesiologists and
football players asked for this

confrontation, asked for this sit -down
meeting, where Kirk Wright just wouldn't

disclose any details.

And things became very acrimonious very
fast after that point.

Wright tries to calm them with a $155
million account statement.

But he won't let any of them examine the
document.

Atwater and other insiders start
planning exit strategies.

It's never been completely disclosed who
leaked what to whom when, but it was

very soon after that a tip came in to
the SEC that something was awry at IMA.

But Wright clearly thinks the best thing
to do is pretend nothing's wrong.

On October 22, 2005, he and his second
wife throw that over -the -top

wedding.

He had to know that spending $500 ,000
on a wedding, he had to know on some

level that that was not a smart move.

The honeymoon is soon over.

In December, Wright starts to give
investors the runaround.

Payments had been missed, checks had
been bounced, and investors had started

become very concerned that the money
just was not there.

And that was the point where Atwater
said, He just felt physically sick.

He knew that something was desperately
wrong, and he had brought many of his

friends in on this, and it was getting
ready to break very bad.

In an interview with Bloomberg News,
Atwater states, In my wildest dreams, I

never thought he was stealing money.

2006 arrives in a downward spiral.

Investors get no further than the
receptionist when they call.

I asked her, what's going on? And she
said, oh, everything's fine. Just a

shakeup in the company.

But everything's fine. Don't worry about
your money, Mr. Praris. Your money's

safe. By February 2006,

Kirk Wright will flee Atlanta.

Next, with the feds on his trail, will
Wright take the money and run?

Or will he take a permanent vacation?

In January 2006,

International Management Associates of
Atlanta still looks like a good

investment. Its manager, Kirk Wright,
claims the company has more than $150

million under management. That month,
retired businessman Alan Ehrlich follows

up on a tip to check IMA out.

I read all the paperwork. I called
people for references, and everything

checked.

Unfortunately,

His million is the last money invested
with IMA.

In Atlanta, everything is about to go
down the drain.

Investors who want payments are getting
the runaround.

Throughout the month of January,
unfortunately, Kurt gave me excuse after

of his business, that it was year -end,
they were putting together all their tax

information, that the operations had a
lot of ongoing activity.

A key group of investors, retired and
current NFL players, band together to

demand their money.

Kirk Wright stonewalls them.

Mr. Wright told the players, you'll get
your money next month.

Oh, I've had a problem with the banks.
It'll be the next month.

And then finally in February, they
realized they probably weren't going to

their money.

On February 17th, the players go to
court. A judge quickly freezes IMA's

Ten days later, the Securities and
Exchange Commission files charges

been working on as well.

When the FBI raids IMA's office,
Wright's computer is missing.

So is he.

Well, it's not exactly road rage, but
there was living room rage.

You know, we heard that.

The FBI and the SEC move in to recover
what they can of IMA's assets.

But there is less than $200 ,000 left.

Even by the standards of forensic
accountants who had seen Ponzi schemes

they found surprisingly little.

They found the physical office desks,
chairs, valuables at the office,

file cabinets. They didn't find much
more at all.

In the meantime, the FBI is hunting the
man responsible.

For three months, they chase every lead
and check every possible hideout.

But this is a fugitive case with a
twist.

While in hiding, Kirk Wright is giving
interviews to the Wall Street Journal.

He was calling us from a cell phone that
was non -traceable, throwawayable, but

still saying, well, I'm not on the run.
I don't have anything to hide. I'm just

being careful of my movements.

Mr. Wright's explanation for that was
that the investors, particularly the NFL

investors, were so mad at him that he
was afraid for his own personal safety.

It was highly unusual to be reading
about conversations in the paper that a

fugitive is having with a reporter
claiming not to be a fugitive when at

same time we are doing everything we can
to locate him.

Even on the run.

White -collar criminals typically
maintain the lifestyle to which they

become accustomed.

That is certainly true of Kirk Wright.

On May 17, 2006, the FBI catches up with
him, lounging in a lap of luxury.

And at the time of his arrest, he was
laying by the pool at the Ritz -Carlton

South Beach in Miami.

By all accounts, didn't appear
incredibly surprised to be found.

He was just writing out the remaining
days until, you know, the web did

tighten in on him.

The 35 -year -old is checked in to
different accommodations.

In May 2008, Kirk Wright goes on trial
for 47 counts of fraud and money

laundering. Former partners testify
against him.

His basic defense is that his losses
were basically legitimate trading

We always had a dispute with everyone,
the government, the SEC, the bankruptcy

trustee, as to what the total amount of
the loss was.

This was a defendant who made his living
by convincing people to part with their

money, basically be a salesman, and
that's what we argued to the jury that

was trying to do, basically to them, was
sell them a story.

The government wins the argument. On May
21, 2008, Kirk Wright is convicted on

all counts.

The man, who so recently was on top of
the world, seems to take the verdict

composure. We met with him 15 or 20
minutes after that.

And he seemed pretty upbeat at that
point for someone who had just lost a

and a grueling trial.

He'll have to wait three months for
sentencing, but he knows it could run

hundreds of years.

On one level, this is a very...

Proud and confident person that it's
hard to imagine spending the rest of

life in jail with no possibility of ever
getting out. And no quality of life

that resembles the affluence and riches
that they had.

At the jail, he is placed on a
heightened watch, as all recently

inmates are.

But guards don't watch him 24 hours a
day.

Three days after his conviction, Wright
ties one end of a bed sheet around his

neck. and the other around the top bunk
in his cell.

By the time the guards make their next
check, Wright has made his final exit.

He is dead, and so are his clients' last
hopes of recovering much money from the

fraud. We figured that the only other
leverage we would have is for him to

basically get a reduced sentence based
upon the cooperation of letting the

authorities know who else was involved.

and where the money went. I would say
that, you know, Kirk, he ruined lives.

I mean, there's 500 investors.

A few assets, Wright's house, cars, and
office equipment can be liquidated.

That all takes a long time, so I don't
know that there's a final answer to that

question right now as to how much folks
are getting back or can expect to get

back, except that I think, as everyone
knows, it's likely not to be anything

close to 100 cents on the dollar.

His second wife is allowed to retrieve
only her personal possessions before the

house is auctioned off.

Investors are simply out of luck.

71 -year -old Alan Ehrlich's plans for
retirement had to be scaled back.

His wife had to return to work, and now
he lives in a rented condo. This was

money that, you know, you plan on for
the rest of your life, and you're going

earn a certain return, and then you can
live, and that changed, obviously.

Other investors think Wright's suicide
was his final selfish act.

A case of justice denied.

Not angry.

Not angry.

Disappointed. I wanted to visit him. I
wanted to visit him in prison.

And I would have. I would have been at
the sentencing.

So I got robbed.

I got robbed, figuratively and
literally.