All language subtitles for American Greed s06e10 Nicholas Cosmo All Interest, No Return

...turns on booming real estate
opportunities.

His victims are cops and teachers,
hairdressers and builders.

We had confidence in him, and we were
convinced that this was legitimate.

So I invested my IRA, $130 ,000, my
entire life savings.

You're making money, you become
complacent, you become comfortable, and

when you get hurt.

Nicholas Cosmo brings white -collar
crime to blue -collar America.

He just took all my life savings and
squandered it.

Bilking his victims out of $400 million.

One greedy scoundrel was able to destroy
the lives of 4 ,000 people. Their

hopes, their dreams, taken away, all
because of his greed.

On January 26, 2009, federal agents raid
the headquarters of Long Island money

lending firm Agape World, Inc. on
suspicions of fraud.

Meanwhile, the company's president and
founder, 37 -year -old Nicholas Cosmo,

slips out the back door and flees to
Manhattan to his attorney's office.

Later that night, Cosmo takes a commuter
train back to Long Island with his

lawyer. and surrenders to U .S. Postal
Inspectors.

He is charged with 32 counts of mail and
wire fraud.

WNBC's chief investigative reporter
Jonathan Deenst is on hand to catch a

glimpse of New York's latest accused
fraudster.

Who is this guy? No one had ever heard
of him before. And who is this guy who

allegedly took part in a $400 million
fraud? Who is he?

The story begins in suburban Wontar, New
York, on Long Island.

Here, in a blue -collar town, in a blue
-collar family, Nicholas Cosmo is born

and raised.

Cosmo talks of his salt -of -the -earth
family in this exclusive telephone

interview with American Greed.

I grew up in a classic, structured,
strict family.

Just a very loving family, I guess you
could say.

Nick Cosmo may end up being a black
sheep, but in his youth, he's the pride

Wontaw, a hometown kid on the rise.

Reporter Dave Wenzelberg covers Cosmo
for the Long Island Business News.

He's got so smooth, so convincing.

Cosmo was very involved in sports.

He played soccer, he played baseball.

Baseball was his ticket to college. He
got a scholarship to St. John's, which

a great baseball program here in New
York City.

But playing sports isn't enough for the
ultra -competitive Cosmo.

As a teen, he secretly starts betting
and is soon hooked on the rush of risky

sports gambling.

Unfortunately, he had a gambling Jones
very early on. He went to his first

Gambling Anonymous meeting while he was
still in high school.

So it was apparent that he would have a
problem with gambling for a long time.

I know I have a gambling addiction.

It was always something very difficult
for me to control.

In 1993, Cosmo is drafted by the Ohio
Valley Redcoats minor league baseball

team. And he has a shot at the big
leagues.

But after one season, he is cut.

I'm only 5 '8".

And, you know, that always is a strike
against you in baseball.

You have to be exceptional, exceptional.

And I wasn't that.

And so the unexceptional baseball player
and closet gambling addict finds

himself in need of a career.

He decided to go at that time into being
a stockbroker. And he thought that was

the best way to make money fast.

In 1993, Cosmo gets his Series 7 license
and finds a job as an entry -level

stockbroker. In the mid -90s, Long
Island is the epicenter of the so

boiler room brokerage, made famous in
the feature film of the same name.

He hooked up with an outfit here on Long
Island that was one of the models for

a boiler room movie.

It was that kind of operation.

Boiler rooms are startup firms that use
young brokers to make high -pressure

cold calls to unsophisticated investors.

They just hammered people on the phone
looking for anybody with money. They

could be retirees. They could be people
with 401ks or whatever.

Cosmo liked the action.

He was a gambler, so he liked the idea
of making stock trades.

Cosmo is learning the ropes.

learning how to talk people out of their
money, selling penny stocks and other

high -risk investments.

But on the side, he's also raising the
stakes on his gambling habit.

I worked with 200, 300 men, and we were
all in our 20s, and guys were making a

lot of money. The sports gambling got
out of control.

According to Cosmo, he's coming up on
the losing end of too many bets.

And although he won't name names, his
gambling creditors are not the nicest

in town.

You know, you can use your imagination.

You know, you gamble with people that
expect to get paid and will do what they

can to collect that money.

Cosmo has a girlfriend and a baby son to
support, and a nasty gambling habit is

eating up much of his salary.

until Cosmo comes up with a scheme to
pay off his bookies.

He took money from about 10 clients and
told them he was investing it in a

certain place when he was paying back
his own gambling debts. And he took them

for a tune of about $177 ,000.

In this exclusive telephone interview,
Nicholas Cosmo talks about his crime for

the first time with American Greed.

I said that I worked for a company
called Charles Schwab, which I did not.

You know, I basically told these people
that I was going to manage their money.

And, you know, I bought them options. I
lost money in the market with them.

And at the same time, I was gambling and
paying my gambling debts.

Cosmo secretly transfers his client's
accounts to his own company and quickly

loses or gives away $177 ,000 of their
money.

When one investor is not able to
withdraw some of his principal, he

Cosmo to the FBI.

In December 1997, Nicholas Cosmo is
arrested on fraud charges.

He pleads guilty to one count of mail
fraud and is barred from ever trading in

securities again.

He's ordered to pay his restitution and
is sent to live out his 21 -month

sentence here.

at Allenwood Federal Correctional
Facility in Pennsylvania, a place also

referred to as Club Fed.

But there were no fences, no bars, no
handcuffs.

I should have learned my lesson back
then, of course.

But that wasn't prison.

It appears that Cosmo does not learn his
lesson.

In August 2000, the same month he's
released from prison, Cosmo establishes

new corporation.

He calls it Agape World Inc.

Agape is a very popular word in the
Bible. It means perfect love.

I always believed in perfect love. I am,
I guess to say, a romantic at heart.

Cosmo wanted to have a name that really
exuded trust and a benign type of

name.

No longer allowed to trade securities,
Cosmo's company moves in a different

direction. Real estate loans.

In the early 2000s, the U .S. economy is
booming.

Real estate has never seemed a safer
bet.

And everyone wants a piece of the
action.

Michael Kessler is a New York private
investigator who digs into Cosmo's

background. Agape World was basically
and simply promoting bridge loans. And a

bridge loan is when you need to borrow
money because you're going to be selling

off one piece of property and buying
another piece of property.

Agape's plan is to supply short -term
bridge loans for big real estate

developments, charging more than 20 %
interest.

When the loans come due, investors would
be rewarded with high percentage

returns.

You know, I saw the potential, you know,
in the bridge loan market.

Borrowing money was very easy, and the
real estate market was really where to

be.

In order to lure in investors, Cosmo
assembles a ragtag crew of salespeople

calls brokers, made up mostly of friends
and even ex -cons he befriended in

prison. The staff that he had...

We're not the educated financial people
that you would give millions of dollars

to in order to invest your money. These
were people, a lot of them had served

prison times themselves, and some of
them couldn't chew gum and walk at the

time.

But in this confident climate, Cosmo's
inexperienced brokers have no trouble

selling a supposed sure thing.

So these guys were out there running and
pitching and word of mouth spread. And

increasingly, these unsuspecting
investors went and believed the

believed the website, believed what they
were being told.

A friend of mine who was in the mortgage
business actually got me involved and

talked about this investment that he was
in. And he was getting very good

returns, even more than he originally
thought.

For Long Island Special Education
Administrator Kevin Milano, the

appears sound.

I did my research, looked into it, like
I do with all my investments. I think

I'm a pretty good investor, and then
decided to delve in a little bit.

Milano tests the waters, investing $70
,000 to start.

He's told he will make 14 % in 90 days.

I got my statement back, and I had made
that amount of interest over a short

period of time, and the bridge loan came
through.

And from that point, I started to invest
a little bit more and a little bit

more.

Within two years, he's in for $210 ,000,
his entire savings, to realize his

dream of a Florida retirement home.

It's money he's worked for and invests
wisely for 30 years.

Milano feels secure with Agape.

in large part because Nick Cosmo is
practically a neighbor and seems like a

trustworthy guy.

I saw him frequently at the Little
League field on weekends, fixing the

up, teaching kids how to bat.

He wasn't at a country club on the
weekends. He didn't have a private jet.

was pretty much living a suburban life
here.

Next on American Greed.

Cosmo says he's loaning out hundreds of
millions of dollars for real estate

deals. So why haven't some of his
supposed borrowers ever even heard of

When I realized that this could be a
scam, you know, my heart dropped.

In 2007,

Long Island -based Agape World, Inc.
appears to be a very successful money

-lending firm.

Founded by 35 -year -old Nicholas Cosmo,
Agape reports 10 million in profits

that year.

In the suburban communities of Long
Island, Queens, and Staten Island, New

thousands of working -class investors
believe that Agape is a good place to

their money.

Word of mouth is out on the street. My
neighbors can vouch for this guy. They

say, look, I've made money with him.

You can too. And it's a safe, sure
thing.

These were not hedge funds that we're
investing with Cosmo. These were

working people.

My girlfriend had heard about it through
her attorney, and she told me about

it.

64 -year -old Ellen Gabriel has been a
hairdresser and cosmetician for more

40 years.

She is not married, has little family,
and has been putting away money in an

for most of her working life.

Now, it seems everyone she knows is
raving about Agape World.

My girlfriend said that it was going to
be about 12 % every 90 days.

Gabriel decides to pull $30 ,000 out of
her IRA and invest with Agape.

Like her friend, Gabriel receives
statements showing that her money is

and she lets it ride.

Then, four months later, Nick Cosmo's
profile rises to a national level.

Entrepreneur Magazine puts out a list of
the 100 fastest -growing companies in

America, and when Cosmo made that list,
he used that as his ticket to

legitimacy.

This is the email that I got from Agape.

Ellen Gabriel's Agape broker sends her
an email about the article.

They were absolutely glowing about the
company, about Mr. Cosmo. Had a picture

of him in the magazine.

Went on the website.

All kinds of information about him.

So I invested my IRA.

$130 ,000.

My entire life savings.

Gabriel isn't the only one impressed by
Agape World's place on Entrepreneur

Magazine's list.

Within a few months of its release, Nick
Cosmo is flooded with millions of

dollars in new investor money.

Like most investors, Dom Dicolandria
learns about Agape through a friend.

who says he's making about 14 % every 60
to 90 days.

That's 50 to 85 % a year.

My limited understanding at that time
was that they gave bridge loans to

businesses. And because the interest
rates were so high that they were

collecting on those loans, they were
able to pay the investors high interest

returns.

DeColandria researches the company and
likes what he sees.

I checked the Better Business Bureau.
They had no complaints. And Dun &

Bradstreet, which gave them an A rating,
you know, credit -wise.

So I felt they gave it some credibility.

And at that point, we basically put our
life savings into it.

For more than a year, DeColandria, along
with thousands of other Agape

investors, is riding high on his good
fortune.

It seemed to me like an opportunity that
we couldn't afford to miss.

The return on our investment could
probably cause us to stop working and

an earlier retirement.

So that's what we were looking forward
to.

Investors are not the only one profiting
from their agape deal.

Nick Cosmo's staff of so -called brokers
are bringing in millions of dollars in

commissions, even though these brokers
are made up mostly of friends,

including... a formerly unemployed
surfer and 2X con with no financial

experience. In fact, the way the
structure worked, the main brokers got

as 18 % off of whatever they sold.

Some of the brokers, the unemployed
surfer, took in $15 million in

alone in a very short span, in just a
couple of years.

From what we gathered in our
investigation, they were spending money

Maseratis, on Rolls Royces, houses in
the Hamptons. I mean, they were living

life of Riley, as they say.

While his employees are living large,
Nicholas Cosmo is surprisingly not

himself a huge salary or buying million
-dollar homes or yachts.

But he is living a comfortable life,
taking luxury vacations with his family.

and buying his wife expensive jewelry.

He also purchases this indoor sports
complex on Long Island for $3 .5 million

and refurbishes the local outdoor Little
League field with lights and bleachers.

He's betting this everyday suburban dad
persona is good for business.

Here's this guy who's, you know, out
there in the community doing good works,

good deeds, at least that's what it
appeared.

So, hey, he must be a good guy. Yeah,
we'll invest with him, too.

Next on American Greed, Nicholas Cosmo's
investors are about to find out that he

is a con artist and using their money to
fuel his habit. His method of choice

for spending the money was not big homes
or big cars.

It was gambling.

It was his addiction that drove him.

Lou Piccoli has been in the construction
business for 25 years, building and

renovating houses with his own hands.

At 43 years old, a husband and father of
two young children,

to a 4 ,500 -square -foot oceanfront
home on Long Island.

This house that was my 401K, my first
home, literally could fit in this

bedroom. It was a little, little
cottage.

I fixed it up and I sold it.

And I bought another house. I did that
seven, eight times.

The cost for a home like this is very
steep, and Piccoli is working 60 and 70

hours a week to pay for it.

Then, in February 2007, a friend tells
him about an easier way to make a

I was on a job site. I'm a contractor.

And he just told me he was invested with
this copy of World Inc. It was

incredible interest.

Gave me a brief description of it.

Piccoli sets up a meeting with the
company's founder and president,

Cosmo, and likes what he hears.

It was building loans for people that
couldn't get conventional financing, so

they were willing to bridge the gap, pay
exorbitant interest rates for short

term, which would help them sooner or
later acquire conventional financing.

It made sense.

Piccoli sees the investment as a way to
plan for retirement and secure his

family's future.

At the height of the real estate bubble,
he's easily able to take out $250 ,000

in equity from his house.

To that, he adds his own hard -earned
life savings, more than $50 ,000, and

invests it all in Agape. He quickly
begins to reap the rewards.

Now, you know, with the interest and it
rolling over, I'm making $50 ,000, $60

,000 every other month.

To me, to a guy who's a builder, that's,
you know, that's real.

Real good living.

Why am I in construction?

Piccoli decides he's in the wrong
business.

So he trades in his table saw for a pen
and a calculator.

He gets out of construction and opens a
one -man financing company with the sole

intention of getting his network of
family and friends invested in a goppy

world. From cousins that live out of
state, friends.

You know, it snowballs. Friends,
parents, and brothers and sisters.

I had roughly about 40 people.

I was very upfront with the money I'd
make with them.

They can go through me.

I'll take their checks up. I'll do all
the running around.

People have jobs. They don't have the
time. I'll do all the legwork.

Piccoli takes a 1 % commission from the
people he brings in.

And for the next two years...

He makes a nice living off his new
enterprise and his own investment.

It's providing me with an opportunity
not just to accelerate my goals, but

I am. I'm the guy.

I'm the nucleus. I brought all my
friends, all my family, all these

they're doing well.

And you feel fantastic.

Piccoli could never have imagined that
within a year, he'd lose his job, his

home, all of his money.

and even his marriage.

And more than 4 ,000 other investors
would lose their shirts as well.

July 2008 is the beginning of the end.

In the midst of the U .S. economic
meltdown, one of Nicholas Cosmo's only

-scale investors, a New Jersey -based
business owner and his partners, decide

they want out of Agape World.

and want more than $1 million of their
money back.

When they get no response from Cosmo,
they call in New York City private

investigator Michael Kessler.

They were being prevented from getting
this money back, saying that it wasn't

available. They were getting the stall,
and it made them feel uncomfortable that

something might be astray.

Kessler begins investigating.

and quickly finds out that Nicholas
Cosmo is not the solid businessman he

appears to be.

Previous jail time, we found that he had
filed for bankruptcy in 98.

The corporation Agape World was set up
while he was in jail.

In the late 90s, Cosmo served more than
a year in federal prison for securities

fraud. He was able to keep it secret
from his Agape investors for more than

eight years.

Now, Michael Kessler starts to believe
that the whole operation is a scam.

As we did research on the bridge loans
that he said that he was issuing, we

found that he didn't have liens on the
properties, which was highly suspicious

to us. And also some of the people in
the properties never even heard of Mr.

Cosmo. And as we dug deeper, it became
clear that this was just simply another

Ponzi scheme.

Kessler brings his information to law
enforcement, and the FBI begins an

investigation.

But he also wants to get the word out to
potential investors, so he rings an old

friend. I said to Dave, there's
something breaking on Long Island that

should be aware of.

Long Island Business News investigative
reporter, David Wenzelberg.

There was a lot of people putting money
in, and the interest was like 14 % in a

very, very short amount of time, as
little as 72 days.

All the classic signs, as Mike would
say, the red flags came up that it was a

Ponzi scheme.

On August 29, 2008, the Long Island
Business News runs its first story on

Nicholas Cosmo's criminal past.

And many investors get nervous.

Then, a few months later, the largest
financial fraud case in U .S. history

breaks. Bernie Madoff is 24 -7 News.

When you heard a $64 billion fraud by
Bernie Madoff that went on for decades,

lot of investors said, wait a minute,
what's going on with my money? And they

began to check. And a lot of people
began to try to pull their money out.

For more than four years, Nick Cosmo is
inflating the loan amounts he's

supposedly lending out.

And although he collects more than $350
million in investor dollars, Agape lends

a paltry $25 million to borrowers.

He's paying returns not with profits,
but with investor principle.

In this exclusive phone interview, Cosmo
explains.

Purely, they were taking out other
people's money.

And at the same time, I was also trading
futures, trying to make

up all the deficit that incurred from my
own doing.

Increasingly desperate, Cosmo is
gambling in the high -stakes futures

burning up to a million dollars a day.

At the time, he's hiding all of this,
trying to run damage control and calm

investors with seminars at his offices.

I'd invite about 100 or 115 clients
every night.

I'd let them ask any single question
that they could possibly think of,

to relieve their fears.

And, you know, it worked for the most
part.

And, you know, what I was doing was
basically trying to put out buyers one

at a time.

He had the whole big hall there at his
office building.

And I tell you, he did a great job as
far as conning us.

Investor Kevin Milano attends one of
Cosmo's seminars with the intention of

getting his money back.

But Cosmo not only convinces him
everything is fine, he even sells Milano

insurance on his investment.

You know, he started to make us feel
comfortable with the fact that even if

everything goes bust, We're insured.

So then he that's how people even
invested, which I did, too, invested

probably thirty five hundred dollars for
insurance.

The seminar was unbelievable because
this again, this was in late December

Madoff, where there were rampant rumors
that this company was about to collapse.

And he was able to convince people to
give him more money.

He was really, truly amazing.

You know, we called him the fraud
whisperer around the newsroom.

Next on American Greed.

Cosmo might be able to fool his
investors for now, but the feds are

They were investigating. They had some
wiretaps up and had done some

so they were on his trail.

How long till we get our principal back,
Nick?

In December 2008, Nicholas Cosmo's money
-lending firm, Agape World, is on the

brink of collapse.

When interest payments start falling
behind, many investors begin to panic.

People started to ask for their money
back, their principal back.

People were getting nervous.

Problem is, Cosmo doesn't have the money
to pay his investors back because his

entire business model is a sham.

the money that came into the company.

And that's obviously what is considered
a Ponzi.

In addition to paying out returns with
other people's money, Cosmo is using

of millions of investor dollars to feed
his gambling addiction.

It's not a guy who, oh, gee, I made some
mistakes, I made some bad investment

choices, and some investors got hurt.

He set up the scheme from the beginning
knowing it was going to be a...

criminal fraud, a rip -off, and he
didn't care. He didn't care one bit.

What Cosmo doesn't know is that the FBI
and the U .S. Postal Inspectors are on

to him.

Investigators are secretly posing as
potential investors and borrowers,

gathering intel on the copy world.

I mean,

I want to make sure it's very clear to
everybody that my job may be here right

now.

This was a way to calm everybody so that
they wouldn't run to the FBI or, you

know, they wouldn't pressure him to give
him his money back, although most

people already were.

It was sort of a desperation move. And
if you listen to the call, he did

convince a few people to hold on.

behind you and make sure you go through
with this.

Well, I appreciate that very much, and
the only thing I need is patience from

everybody in this situation.

The other thing you have to consider is
a lot of these investors didn't want the

scheme to collapse, if it was a scheme,
because then they knew their money was

gone. So a lot of them were just holding
on.

Dom DeCalandria has his entire life
savings invested with Agape.

He's on the conference call.

and comes away feeling optimistic.

It's his job to gain our confidence.

And at the same time, he has to convince
people.

So he was good at both.

We had confidence in him, and we were
convinced that this was legitimate.

Cosmo may be keeping his cool in front
of investors, but he's getting

increasingly desperate and raising the
stakes on his gambling, trying to hit a

big payday in high -risk futures
trading.

As things got a little tighter, His
trades got even more desperate and more

risky.

Eventually, he ended up losing close to
$100 million in those trades.

On January 26, 2009, the Feds move in,
raiding Agape World offices and letting

Cosmo know they'll be back to talk to
him.

We saw the FBI and postal inspectors and
other law enforcement officials going

into these offices, dozens of agents
coming out with box after box after box

evidence, and what we learned later was
a $400 million fraud.

As news of the raid spreads quickly,
investor Louis Piccoli gets a call from

Agape broker.

He was in tears. I can't believe it.
It's all a scam. You've got to get down

here.

You literally, you hang up and you look
at the phone for a moment. I'm thinking,

ring. Please ring and tell me that was
just in the worst taste, but that was a

joke.

Piccoli has brought in 40 friends and
family members to Agape, and they have a

total of $4 million invested.

He races to Agape headquarters.

There's 100 people on the steps outside
demanding to get in.

I get into the office, and there's
brokers, grown men, crying.

And we get Nick, and he's just walking
around like a car wreck.

He's just in a daze.

And now this is literally the
quintessential angry moth. They're

in and, quite honestly, kill him.

You screwed a lot of people, all of you.

Lou Piccoli and a couple of friends stay
level -headed while trying to get

answers out of Cosmo.

So I start talking to him, and I'm still
hoping somehow that there's money

somewhere. You had to hide money
somewhere, an offshore account.

I don't care if it's in a pickle jar in
your yard, somewhere.

But how do I get that? How do I get that
out of him?

But Coley decides the only shot he has
at recovering any money is to keep Nick

Cosmo safe from the investors who want a
piece of him.

He throws a coat over one of the broke
heads and he goes running through the

crowd and everybody follows him.

And then Nick Cosmo walks out the back
door.

The men drive Cosmo to his attorney's
office in Manhattan.

But later that night, he takes a
commuter train back to Long Island.

to meet his fate.

We'd all gathered at the postal
inspector's offices for Cosmo's arrival.

Everyone wanted to see who was this
latest crook who had ripped off everyday

people. And postal inspectors pulled
into the parking lot, and there was Nick

Cosmo in handcuffs.

Cosmo is booked on 32 counts of mail and
wire fraud, and the local press dubs

him Mini Madoff.

There was another huge Ponzi scheme
where everyday investors were ripped

all because of greed.

Nearly identical rip -off schemes, if
you will. You put money in, you'll get

returns out, and it was all based on a
lie.

So Cosmo and Madoff, hand in hand, glove
in glove, one in the same.

On October 29, 2010...

Nicholas Cosmo stands before a judge in
federal criminal court, accused of

running a Ponzi scheme and stealing $400
million from more than 4 ,000

investors.

Cosmo pleads guilty to one count each of
mail fraud and wire fraud.

Twelve months later, he is sentenced to
25 years in prison.

More than 30 of his victims are on hand
to watch.

So is Long Island business news reporter
Dave Winsleberg.

The victims were devastated.

These were people who lost their life
savings, people that couldn't afford to

lose their life savings.

People lost their money for colleges,
for their kids. It was all they could do

to keep from, you know, rushing up and
strangling Cosmo, I'm sure, when they

were in the courtroom.

Special education administrator Kevin
Milano lost $210 ,000.

And his dreams of retiring to a Florida
home with his wife were on hold

indefinitely, thanks to Nicholas Cosmo.

This is a man that you're sitting there
and watching fix up the little he feels

like, and you say, oh yeah, he's
absolutely, he wouldn't lie to you, you

So, you know, there has to be something
wrong with him, and hopefully one day

he'll get some help.

64 -year -old hairdresser Ellen Gabriel
lost $130 ,000.

Her entire retirement fund she had been
investing faithfully in for 30 years.

Now, she believes she will have to work
until the day she dies.

Retirement isn't even an option.

I do work seven days a week. I've worked
holidays. I've worked Christmas. I've

worked New Year's.

If it snows, if it rains, it doesn't
matter. I just go. I have clients. I go.

do.

48 -year -old Louis Piccoli still lives
in his oceanfront home on Long Island.

For now.

It's in foreclosure, and he and his kids
could be kicked out any day.

Panic one day that the sheriff's
department's going to come, knock on the

and tell you you've got 48 hours a week
to vacate.

Okay.

Here's my question.

Where?

Tell me, where do I take him?

A billionaire for 25 years, Piccoli left
the construction business to work full

-time handling family and friends'
investments in Agape World.

But in the wake of the real estate bust,
he doesn't even have his old trade to

fall back on.

Piccoli says he has little work and few
contacts.

And he says the Agape ordeal has been a
huge contributor to the breakup of his

marriage.

I haven't had a good night's sleep
since.

I can't put...

two, three straight hours together. You
just, you constantly, it doesn't go

away. How can it?

The nightmare I'm living isn't just my
own.

My parents' home is in foreclosure
because I got them involved in this.

I have relatives that can't do things
for their children because they lost

everything.

The only thing that keeps me going, and
I honestly don't mean to sound corny,

but my children will never fully
understand.

That they saved me.

Real estate appraiser Dominic
DeColandria's entire life savings has

out.

But instead of spending energy on anger,
he takes a more reflective approach.

He says he's learned a valuable lesson.

The victim's got to take some
responsibility, too. You know, we

been victims had we not failed to
recognize that this was an unreasonable

of principle.

So there's greed on both sides of the
fence.

There's some you can feel sorry for and
some you might not, but we all need to

be responsible.

A trustee is appointed to the case to
try and recover funds.

But so far, he has only recouped an
estimated $20 million, returning just a

fraction of that to victims.

In this case, the victims are lucky if
they get pennies and maybe even...

Less than a penny on the dollar when
everything's finally recovered.

For the past three years, Nicholas Cosmo
gets by in an eight foot by eight foot

cell in federal prison.

Cosmo tells American Greed that he never
intended to hurt anyone.

In my mind and in my heart, I was able
to get through every single day because

thought I was helping people. That I was
going to be able to fix this problem

that I created, but I was going to be
able to fix this problem.

So that energy, that inner drive that I
had was driven by that.

Cosmo also believes his sentence of 25
years is unfair.

He is appealing it, claiming he wants to
get out of prison early in order to

work to pay back his victims.

I don't blame anyone for feeling ill
will or hatred

or anything, disillusioned.

by me or my actions. I've taken full
responsibility for everything I've done.

I'm obviously being punished for it.

And the only thing I seek is just an
opportunity to

pay them back.

One of those victims is Kevin Milano,
who has spent his career working in

special education.

He believes there is a lesson Nick Cosmo
should have learned early in life.

but didn't.

I work with kids who are severely
developmentally delayed.

You know what? They know what's right,
and they know what's wrong.

But he knew it, and he did it anyway.

If he stayed in jail for the rest of his
life, that would be fine.