All language subtitles for American Greed s12e16 Just a Dollar and a Scheme.eng

Buying a winning lottery ticket
is a dream come true.

Right here!

We have the winning tickets
right here!

People were fascinated
by this case

because everyone's fascinated
by the lottery.

Narrator: When the winner of
a $16 million jackpot

refuses to identify himself,

officials suspect
a rigged game.

Ding! Ding! Ding!
Something is screwy.

Narrator: It turns into
the biggest lottery scam

in American history.

He figured out a way
to keep winning the lottery.

♪♪♪

Narrator: And later,

New York City's
housing crisis hits home.

Tenants are not seen
as human beings.

They're standing in the way
of dollar signs.

Narrator: The case of
the landlord from Hell.

He cared nothing about
making 23 families homeless.

Narrator: Steven Croman rules

a Manhattan real estate
empire...

More money, more property.

He wanted it all.

Narrator: ...but prosecutors
have other accommodations

in mind for him.

♪♪♪

♪♪♪

♪♪♪

Narrator:
It's Christmastime 2010 in Des Moines,

and Iowans are feeling
the holiday cheer.

The Hot Lotto jackpot
keeps growing,

blowing past
the $15 million mark.

It's one of the Hawkeye State's
most popular lottery games...

The winning numbers
right here.

...and part of an
$80‐billion‐a‐year industry.

Rich: Hot Lotto is a game

that you pick
five different white balls

and one hot ball.

Winning tickets.

It was a big, big jackpot
at the time.

And so, people were
getting excited.

Big, big, big, big,
big winner.

And as jackpots rise,
more and more people jump in.

Narrator: Anyone able to choose
the correct six numbers

will have
a very merry Christmas.

On December 23rd,

a heavy‐set man in
a black jacket, cap, and hoodie

walks up to the counter
of a QuikTrip convenience store

off Interstate 80.

You can't quite see,
uh, his face.

You can hear his voice
a little bit.

This man buys these tickets.

Goes out to his S. U. V.,
drives away.

♪♪♪

A few days later,
December 29th, 2010,

it's announced that
the winning Lotto ticket

was bought at this
QuikTrip gas station

in Des Moines, Iowa.

Narrator: The prize is worth
$16.5 million.

There's a buzz
in the crisp winter air.

Man: Somewhere out there is
a heck of a ticket

worth $16.5 million.

Narrator:
Who's the lucky winner?

Forgrave: People love to talk
about the lottery.

They love to play the lottery.

It's just that ‐‐
that dream chance

that you could achieve
the American dream

without having
to do anything.

Narrator: Days pass,

as lottery officials wait
for someone to come forward.

And wait.

Man:
Someone has the ticket.

Uh, the Iowa lottery wants
to give away the money.

Uh, we want to show ‐‐
we want someone to come in

so we can show you the money,
give you the money.

♪♪♪

Rich:
Most people wait a little while

to claim their jackpot

because they want to talk
to a financial advisor

and talk to a lawyer.

But then this one
really took a crazy turn

because people didn't show up
after 30 days,

uh, didn't show up
after six months.

Narrator: Lottery officials
remind the public

there's a one‐year deadline
to claim the prize.

The clock ticks down, until...

Rich: It was only
an hour and a half left

when, in fact, we had
two lawyers walk in and said...

Ladies and gentlemen,
we have the winning ticket.

Yeah, this little baby
we've been looking for

for a while.

I'll hold it for a second.

We're very excited
to have this ticket.

Narrator:
The lawyers are hired

to represent a trust
based in Belize,

a Central American
tax haven.

Ding! Ding! Ding!
Something is screwy.

So we, uh ‐‐ we said,

"We're not gonna pay
unless we know who bought it.

Tell us who bought the ticket."

Narrator:
The mystery client is unwilling to identify himself.

That's fine in other states,

where winners can claim
jackpots anonymously.

But it doesn't fly in Iowa.

Rich: Ladies and gentlemen,

the Hot Lotto Jackpot claim
has been withdrawn.

This man's anonymity was worth
$16.5 million for him.

They didn't know that a crime
had been committed.

The just knew that
there was a puzzle.

Narrator:
No one ever claims the prize.

This puzzle spurs
the Iowa Attorney General

and Division of
Criminal Investigation

to launch a probe.

It stalls for three years

until an ambitious prosecutor
named Rob Sand

gets the case.

Sand:
My boss just handed me the file

and said something like,
"Happy birthday."

Everyone in the office knew
that this was something

that was basically a pain.

Narrator: Sand specializes
in financial crimes.

Sand: I think of them as crimes
against gratitude,

and they're crimes of greed.

His brothers‐in‐law call him
Baby Jesus,

because, you know,
one, he's a bit of a square,

and, two,
he can't grow a beard.

Just like Baby Jesus.

Narrator: Sand considers
one piece of evidence

his best shot
at solving the case ‐‐

surveillance video
of the winning ticket buyer.

We were going to have to release
that video

and provide people
with a way to submit tips,

because if we had
held that back,

you never know
who might've been out there.

Narrator: Investigators post
an online news release

with a link
to the 74‐second clip,

appealing to the public
for help.

Sand: The video itself
is actually very blurry.

You really can't make out
who that man might be.

Narrator: And yet they receive
a stunning series of tips

within days.

It's not the face
or the look of the man

that rings a bell.

It's his voice.

He has this very distinct
Texas twang...

that could only belong
to one man.

His name's Eddie Tipton.

Narrator:
51‐year‐old Eddie Tipton

is one of
the most respected people

in the lottery business.

He works at the Multi‐State
Lottery Association,

called MUSL,

and is prominently featured
on its website.

MUSL supervises day‐to‐day
functions of lotteries

in three dozen states
and territories,

including Iowa.

Forgrave:
He was a computer expert.

He would do
their security audits.

He would visit other lotteries
and help install machines

and help make sure
that everything was clear.

Narrator:
In a television interview just months earlier,

Tipton stresses the importance
of password security.

Tipton: Security has always
been an add‐on.

And when something happens
it's too late.

The cat's out of the bag.

Narrator: Tipton is popular

with work colleagues
like Jason Maher.

He was a very happy, large,
boisterous guy.

You'd always know
he was in the room.

And he had
a very distinct voice.

He'd walk into my office,

put his hand down
on my shoulder,

and say, "Hey, man,
I just want you to know

I'm your friend,"

you know, with his
little Southern accent.

Narrator: Tipton grew up

in a small Texas town
near Houston

called Flatonia.

He shows a flair
for computers early on.

Forgrave:
When his brothers and sister were playing outside

on the family farm growing up,

Eddie would be inside
fiddling with computers.

He went to school
for information technology

at the University of Houston.

Narrator: Tipton builds
a solid reputation at MUSL,

earning a promotion to
information security director.

It comes
with a six‐figure salary,

but Tipton isn't a big spender.

Eddie was never
a glamorous person.

He had a truck.
He had 300,000 miles on it.

Frugal kind of guy.

Narrator: When Tipton builds
a 5,000‐square‐foot house

outside Des Moines,

it's mostly with his own hands.

Maher: He was always
trying to get people

to come visit his house.

He lived out
in the middle of a field

in a huge castle,
just massive.

I mean, it was a hotel.

Narrator: Though close to
his extended clan back in Texas,

the divorcé yearns
for a family of his own.

He was a very lonely person.

Eddie always wanted a family.

He built this whole thing
from scratch for a family.

And I told him, "You should
get the family first,

then the massive house."

Narrator:
Tipton's dream must wait.

Authorities arrest him
in January 2015

for cheating the very industry
he's entrusted with protecting.

♪♪♪

Next on "American Greed"...

Eddie Tipton stands trial.

But what else is he hiding?

If you've got a money tree
in your backyard

you can't help
but keep picking at it.

♪♪♪

♪♪♪

Narrator:
Authorities suspect Eddie Tipton

of rigging an Iowa lottery
worth $16 million.

The 52‐year‐old stands trial
in July 2015

on two counts
of felony fraud.

I thought
that I had a good case.

I also thought, and knew,
that a jury might disagree.

Narrator: To win the case,

Prosecutor Rob Sand
must convince jurors

it's Tipton buying
the winning lottery ticket

in this surveillance video.

Tipton's defense attorney,
Dean Stowers,

argues it can't be his client
for a very simple reason.

Stowers:
Eddie Tipton didn't have a beard at that time.

And we had, uh,
photographs and other evidence

to support that.

Narrator:
Tipton's brother, Tommy, testifies for Eddie.

Did he have a beard
on Christmas Day, 2010?

No, sir.

Narrator:
Prosecutors call Eddie's friend, Jason Maher, as a witness.

There's no other guy

that could possibly have
this guy's voice,

have the same height,

have the same build,
be the same size.

And it was Eddie.

Narrator:
The case boils down

to whether Eddie
tampered with equipment

to rig the game.

The Iowa lottery
uses computers

equipped
with random number generators

to pick winning numbers.

The machines are sealed
and operated

a few miles away at MUSL,

the Multi‐State
Lottery Association

where Tipton worked
for a decade.

Drawing these numbers is like
launching a nuclear missile.

They have a small room.

That room is under constant
camera surveillance.

When they go in,
there's two computers,

both in locked glass boxes.

Narrator: Sand theorizes
Eddie snuck into the room

where they draw
the winning numbers,

and installed malicious software
with a flash drive.

It allowed him to predict
the winning numbers.

The computers that had drawn
the winning numbers

had been wiped.

There was nothing left
to go off of on them.

What I was doing
was building a case

off of circumstantial evidence
that he had done it.

Narrator:
Defense Attorney Stowers attacks the State's theory,

likening it to
a Hollywood movie gone bad.

He calls it the
"Mission Impossible theory"

where Eddie's sneaking
into the draw room

being Tom Cruise

and trying to stick this
into the computer

and take over the computer.

Narrator:
Stowers can't hide his contempt for the prosecution's case.

Stowers: This case
is like Keystone Cops

being in charge
of an investigation

and sometimes the Keystone Cops
get their man anyway.

How is it that he won
the biggest, uh,

random number generated game
that MUSL runs

at one of
its record jackpot levels?

There's too much going on

for people to think
that this was just random luck.

♪♪♪

Man: We, the jury, find
the defendant, Edward Tipton,

guilty of fraud
as alleged in count one.

Narrator:
The judge sentences Eddie to 10 years in prison.

He's free pending appeal

when news reporters
catch up to him

for his reaction.

Shock. That's it.

It seemed
the Hot Lotto scandal

was nearing an end.

But it was only the beginning.

Forgrave:
After the trial's done.

they find out there's
all these other tickets,

and I think that's where things
really get interesting.

Narrator:
Sand has barely boxed up his trial exhibits

when he gets a phone call
that changes everything.

That phone call was a man
from Texas

who asked me
in a deep Texas drawl,

"Did y'all know that
Eddie Tipton's brother

won the lottery
maybe about 10 years ago

out west somewhere?"

Narrator: It turns out
Eddie's brother, Tommy,

a former deputy sheriff

and justice of the peace
from Texas,

had won the Colorado Lottery
in 2005.

He claimed more than
a half‐million dollars

in prize money

through an acquaintance.

Big hat, big belt buckle.
loud voice.

I think as they say in Texas,
"All hat, no cattle."

Narrator: Sand's team
widens the investigation.

Sand:
And there were always questions in the back or our head

as to whether or not
there were others out there.

Reason being,

you almost never catch
a financial crook

the first time
they're committing their act.

Narrator:
They compile a spreadsheet

of 45,000
winning lottery tickets

spread across the country,

and comb through Facebook
and LinkedIn pages

for any tie to Eddie Tipton.

Forgrave: Rob Sand and his
investigators

start making
all these connections.

There's a connection to a ticket
in Colorado back in 2005.

There's a connection
to a ticket in Oklahoma,

in Kansas, in Wisconsin.

Narrator: The winner
of the Wisconsin Megabucks

in December 2007

just happens to be
Eddie's close friend,

Robert Rhodes.

Robert Rhodes was an incredibly
successful businessman in Texas.

Uh, he had really made
a name for himself.

Robert Rhodes was also the man,

when Eddie Tipton had
a $16.5 million ticket in Iowa,

Eddie Tipton felt
that he could trust him

and passed him this ticket
and say,

"Let's figure out a way
to claim this."

Narrator: Investigators
uncover a conspiracy

stretching across
America's Heartland.

Forgrave: So after Rob Sand
and fellow investigators

look over all these possible
winning tickets,

what they find,

six winning tickets
in five different states

over the course of 10 years.

Narrator: But how exactly does
the gamer game the system?

We were going to need to know
exactly what happened

from Eddie himself.

♪♪♪

Narrator:
Next on "American Greed"...

will Eddie Tipton
finally come clean?

Judge:
Mr. Tipton, what do you have to tell me, sir?

Um...

♪♪♪

♪♪♪

Narrator:
Iowa authorities suspect Eddie Tipton,

his brother, Tommy,
and close friend, Robert Rhodes,

of running
the biggest lottery scam

in American history.

The alleged conspiracy
spans a decade, five states,

and $25 million in jackpots.

It was the way that it stretched
across multiple states.

It was the way that it stretched
so far back in time.

Everything about it was unique.

Narrator: Now investigators
are closer than ever

to solving the mystery
of how Eddie pulled it off.

Sand: We knew that
whatever Eddie had done

had something to do
with draw dates.

Narrator: The answer is hidden

inside computers
Eddie programmed

at the Multi‐State
Lottery Association.

MUSL oversees games

in three dozen states
and territories.

A lot of what he would do

would be getting these
new lottery machines in order

and sending them out to states.

And that means Eddie essentially
has the keys to the kingdom.

Narrator:
Random number generators used in the Iowa Lottery back in 2010

are of little help
to investigators.

The computers that had drawn
the winning numbers

had been wiped

to Department of Defense
standards three times.

There was nothing left
to go off of on them.

Narrator: But Wisconsin,

where Robert Rhodes had won
a $2 million Megabucks in 2007,

is another story.

Investigators recover computers
from storage

that Eddie had personally
delivered years earlier.

Forensic analysis
reveals a tiny code

buried in the software.

Sand:
This was the big mystery

that had gone on
for over a decade.

And that was the smoking gun.

The amazing part of this is

this isn't some
genius computer code.

This is stuff that's easily
available on the Internet.

He was able to find
this piece of code,

insert it into these machines,

and bypass the randomness
of the lottery

to make it predictable.

Narrator:
The code allows Eddie

to predict winning numbers
on three days of the year ‐‐

May 27th, November 23rd,
and December 29th.

If you could have
the time machine

to go into the future two weeks,

wouldn't that be
the first thing you'd do

is you'd find out what
the winning lottery ticket is,

come back to now
and then buy it?

That's what Eddie had.
He made a time machine.

Narrator:
Eddie brings his brother, Tommy,

and good friend, Robert Rhodes,
along for the ride.

Eddie generates a list
of numbers for them to play.

They use acquaintances
to claim the prize money.

It works.

And it might have kept working

if Eddie had quit
while he was ahead.

If you've got a money tree
in your backyard,

you can't help
but keep picking at it.

Narrator:
When the Iowa Lottery rises to $16 million in 2010,

Eddie can't resist
buying the ticket himself.

Unfortunately for him,

he picks
one of the only QuikTrips

in the state of Iowa

equipped to record
both video and audio.

With prosecutors closing in
on the Tipton brothers

and their Texas buddy,
Robert Rhodes,

Eddie can feel his luck
finally running out.

He was down at his friend
Robert Rhodes' house,

down in Texas.

They're sitting in the backyard
and he says,

"Am I paying for my sins?

Am I paying for my sins here?"

This was really weighing
on Eddie.

What Eddie Tipton
doesn't realize

is that Rhodes is about to flip
and turn state's evidence.

Sand: He was willing to testify
against Eddie and Tommy,

and he provided us
with very good evidence.

Narrator:
Eddie's defense attorney negotiates a plea agreement.

The deal means Eddie's brother
must plead guilty to theft,

but will only serve
75 days in jail.

Stowers: Eddie was
the older brother of Tommy,

and Tommy had children,

and that was
a great concern to Eddie

that Tommy not be separated
from his children.

Narrator:
Eddie Tipton pleads guilty in June 2017

to ongoing criminal conduct.

At the time that I wrote
the code, I wasn't sure.

It was more of a
trying to see if I could do it.

Maher:
He probably did want to see if he could do it.

Just knowing Eddie,
maybe he thought that he'd be

at a different place in his life
than he was.

And he's like, "how can I get
in a place where I'm happier?"

Even if he wants to tell himself

he was just doing it
one step at a time

and it wasn't about the money,

there's no denying that
in the back of his head,

there were dollar signs.

Narrator:
Eddie Tipton addresses the court

at his sentencing hearing
in August 2017,

nearly seven years after
buying the lottery ticket

that sealed his fate.

Judge: Mr. Tipton?

What do you have
to tell me, sir?

Well, I certainly
regret my actions.

♪♪♪

It's difficult
even saying that.

♪♪♪

With all the people
that I know behind me

that I hurt.

And I regret it.
I'm sorry.

Narrator:
The judge sentences Eddie to the maximum

25 years in prison.

He and his brother
must also pay back

more than $2 million
in restitution.

Stowers:
I think he has gone through a fair amount of depression

over the whole situation.

Narrator: Eddie Tipton is sent
to serve time

at the Clarinda Correctional
Facility in Southern Iowa.

He'll likely be paroled
within seven years.

Eddie and Tommy Tipton
declined requests

to speak with
"American Greed".

Robert Rhodes
pleaded guilty to fraud

and was sentenced
to two years' probation

and six months
of house arrest.

He did not respond

to repeated requests
for comment.

The Iowa Lottery
has moved past the scandal.

Business is better than ever,

though the state no longer
offers Hot Lotto games.

I absolutely believe

Eddie Tipton would still be
doing this today

if we would have allowed
anonymous winners.

I think
there's this fascination

to the anti‐hero type
character.

As much as what he did was evil
or full of greed,

you almost have to tip your hat
to the guy.

He figured out a way
to keep winning the lottery.

Narrator:
For prosecutor Rob Sand,

the Iowa Lottery scandal
boils down

to a simple moral
straight from the Bible.

"Thou shalt not steal."

There's still a few rules that,
no matter what,

uh, should apply
to everybody.

Man: Yes, sir.

♪♪♪

Narrator:
Next on "American Greed"...

it's the case of
the landlord from Hell.

Barker: Tenants are not seen
as human beings.

They're standing in the way
of dollar signs.

♪♪♪

♪♪♪

♪♪♪

Narrator: New York,

a densely packed city of
8 1/2 million people,

is a world capital of finance,
culture, and cuisine.

While many here take a stab
at the American dream,

few can find
an affordable place to live.

So New York has been
in a housing crisis

for more than 100 years.

All these people coming here,

all these folks
wanting to live here,

how do you have enough
affordable housing?

Narrator:
The government's answer is rent regulation.

For regulated apartments,

rent can only increase
a certain percentage every year,

if at all,

keeping apartments
lower than the market rate.

I am only here
because of the rent regulations.

If I didn't have it,
I wouldn't be able to stay here.

But unfortunately,
what we've also seen

is that a lot of landlords
have abused the process.

Tenants who live
in rent‐stabilized apartments

have really paid the price.

Narrator: Among the city's
most notorious landlords

is a wheeler‐dealer
named Steven Croman.

Steve Croman,
he was always, like,

at the top of all
the bad landlord lists.

And he I think more than anybody

became, like, the face of
what was happening in this city.

Narrator:
Croman has come a long way

from his South Orange,
New Jersey roots.

Real estate runs in his blood.

Hill: I believe his father
was in real estate.

And, so, it was kind of
the family business.

And he struck out on his own

and wanted to build
his own real‐estate empire.

Narrator:
In 1992, the 26‐year‐old

buys his first multi‐family
apartment building,

north of the Little Italy
neighborhood.

221 Mott Street.

Barker: Tenement buildings
that are often

more than
a hundred years old ‐‐

these are the sort of buildings
that are very attractive

to a landlord like Mr. Croman.

Narrator:
Where others see dreck, Croman sees gold.

And the young man
drafts a cunning playbook.

Step one ‐‐
persuade rent‐regulated tenants

to sell their lease
for a few thousand dollars,

or a couple of months
of free rent.

Barker:
It's called "unlocking value."

And how you unlock value

is you push out
whoever is living there.

Automatically you are allowed
to add 20% to the rent

just by getting
somebody to leave.

But for folks like Croman,
that's not enough.

What you can do is renovations.

You then are allowed to increase
the rent even more.

Narrator:
Just a year after Croman buys 221 Mott Street,

New York amends a law

that, for him,
is like manna from heaven.

It places an upper limit
on rent stabilization,

stipulating
that once an apartment

crosses a certain threshold,

currently about
$2,7000 a month...

Barker: Pop!

You lose another one of these
apartments to the free market.

...and suddenly,
Croman can rent an apartment

for as much as he wants.

And I think he was one of
the first landlords

to see the combination
of all of those things

and what you could do
with a building.

So the building
now has 18 units

and only two of them
are regulated units.

Narrator: 221 Mott Street
is just the start.

Over the next 25 years,

Croman expands into Chinatown,
the Lower East Side,

the East and West Villages,
Hell's Kitchen, and Harlem,

building a real estate empire
of more than 150 properties,

from the East River
to the Hudson.

We have some estimates
that he was worth

upwards of
$600 or $700 million dollars.

Narrator:
The Jersey boy treats his family

to a lifestyle
befitting his wealth.

He converts a six‐story
multi‐family apartment building

on the Upper East Side

into one of Manhattan's
largest single‐family homes.

There is
an interesting provision

in the law in New York

that allows for an owner

to evict rent‐stabilized tenants
from a property

if they intend to use the unit
for themselves.

Croman went about moving
each one of the tenants out,

some of whom
were rent‐stabilized

and had lived there for years.

Narrator:
Croman eventually settles with most tenants

for an undisclosed sum,

but his actions rankle others,

especially when they later
find social media photos

posted by
Croman's close friends.

They depict lavish parties
in the city and the Hamptons.

Chaffee:
Parties like Studio 54 parties.

We call them "bacchanals."

They're not parties.

They're just so decadent.

Narrator:
Life is good for Steven Croman.

But for tenants like
Cynthia Chaffee,

it's another story.

She's an artist who moved into
this rent‐regulated apartment

near the Gramercy Park
neighborhood in 1978.

I loved the apartment
'cause it was spacious.

I like looking at the sky.

And I love looking
at the Empire State Building.

Narrator: When Croman buys her
building two decades later,

Chaffee says renovations
start almost immediately.

You are living in a combat zone.

♪♪♪

It's horrible.

I got so sick
from his renovations.

This whole place
flooded with dust.

It was everywhere.

I could still taste that dust
in my mouth.

♪♪♪

Narrator: Chaffee alleges
Croman sometimes

fails to maintain basic services
and make repairs.

We didn't have electric
for two months one year.

And then another year, we didn't
have gas for a few months.

Then we've had water pouring
through the bathroom ceilings.

♪♪♪

Narrator:
Chaffee says Croman won't acknowledge her rent payments,

and drags her to housing court
for unpaid fees.

Chaffee and other tenants
claim frivolous lawsuits

are just another form
of harassment

to wear them down
and accept a buyout.

Chaffee:
What's wrong with this picture?

We're all paying for Croman
to get rich,

'cause what happens is

he uses the courts
and uses harassment

to empty these apartments out,

and he is very successful at it.

Narrator:
Croman denies the allegations in court filings,

and claims to strictly follow

all government
building regulations.

He argues it's tenants like
Chaffee who are the problem,

standing in the way
of badly needed repairs

to century‐old structures.

Croman declined
"American Greed's"

repeated requests
for an interview.

Manhattan has many renters

who say they're fed up
with Croman's tactics.

Robert Pinter claims
to have experienced

similar harassment
in his apartment building.

The Milwaukee native

was thrilled to find
a rent‐regulated apartment

in the East Village
neighborhood in 1982.

Pinter: I loved the apartment
when I moved in here.

At that time,
the neighborhood was,

you know, not so nice.

Narrator:
The neighborhood gentrifies over the next three decades,

and then, in 2012,
Steven Croman swoops in.

Pinter: Steve Croman bought
our building,

I think, a month before
Superstorm Sandy hit.

I always like to say

that Croman's tenure
of ownership here

rivaled Sandy's ferocity
of destruction.

Narrator: Pinter says
it starts innocently enough,

with renovations
to the apartment above him.

Then his closet collapses,
and dust pours in.

I had to just grab my coat
and run out of the apartment,

because I could not breathe.

Everything was contaminated,
the entire apartment, with dust.

Narrator:
Pinter says workmen

eventually place
plastic wrapping

over the doors of apartments
being renovated,

but he believes
his health was damaged.

Pinter:
I ended up getting a cough.

I went to see a pulmonologist

and I was diagnosed
with bronchial asthma.

Narrator:
While Pinter and other tenants

believe renovations are aimed
at making their lives miserable,

Croman's office claims

it's doing everything
by the book

to protect tenants.

Pinter says most of
his neighbors caved,

accepting buyouts
ranging from $5,000 to $10,000.

It's almost like he was trying
to soften them up

and make people crazy enough

that they would just
want to leave.

Pinter stays put.

I didn't leave during
that horrendous period

simply because
this is my home.

Narrator:
Next on "American Greed"...

the office of the New York State
Attorney General

takes on the mega‐landlord.

More money, more property,
more cars ‐‐

He wanted it all.

Narrator:
But can anyone stop Croman?

Want inside information
from the show?

Join the "Greed"
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Facebook page.

We'll be right back.

♪♪♪

♪♪♪

Narrator: New York landlord,
Steven Croman,

takes in an estimated
$63 million in 2014

with a portfolio
of rental buildings

stretching from one tip
of Manhattan to the other.

His personal properties include

19,000‐square‐foot mansion
on the Upper East Side,

reported to include
two swimming pools,

and a Hamptons getaway
known for parties so extravagant

they fill up gossip columns
and social media posts.

Meanwhile,
his work crews are in the city

causing toxic destruction
in all of these buildings,

causing suffering,

and he's out there
enjoying himself.

Narrator:
The 48‐year‐old Jersey boy

seems to have the world
at his fingertips,

and shows no signs
of slowing down.

Mr. Croman is an intense man.

He is very focused on
all aspects of his business.

We've been told he opens
every piece of mail.

Narrator:
Croman is a perennial

on lists of New York's
worst landlords.

Chaffee: So it's like dealing
with the Wild West out there,

and these landlords
are getting away with

doing whatever they want to do.

Narrator:
Chaffee and other tenants

form a grassroots
protest group.

Man: Hello, New Yorkers.

We are members of
the Stop Croman Coalition.

Our elected representatives
must advocate

for state
and federal investigation

of landlords
like Steven Croman

and their questionable
business practices

that harass tenants
from their homes

and remove affordable housing
from New York City.

The Cromans must be stopped.

[ Cheers and applause ]

Narrator:
Protests fall on deaf ears for decades,

until tenants bring
their complaints

to the office of the New York
State Attorney General.

Attie: A group of tenants asked
to come in and meet with us.

The things that they described
were pretty disturbing.

Narrator:
So disturbing that Jessica Attie

opens a civil investigation
into the allegations.

In witness statements,
former employees describe Croman

pacing his spacious
Broadway office.

They say he offers
up to five‐figure bonuses

for persuading tenants
to take a buyout.

Barker: And he would be
yelling things like,

"Buyouts, buyouts,"

like some sort of
cartoon villain.

Tenants are not seen
as human beings.

They're standing in the way
of dollar signs.

"We just have to get this thing
out of the way

and then we can make all
the money that we want to make."

Narrator: Though Croman
is more than willing

to confront tenants
face‐to‐face,

he unleashes
a brawny private investigator

and former New York City cop

named Anthony Falconite.

Attie: Steven Croman referred
to Anthony Falconite

as his "secret weapon."

Anthony Falconite was the person

who would go to the tenants

and persuade, coerce,
or threaten them

into taking buyouts.

Narrator:
Tenants tell prosecutors

that Falconite bullies his way
into units

under false pretenses.

Pinter: I heard him described
as a architect,

a city inspector.

He would gain entry
into their apartments.

Narrator: Once inside,

Falconite hunts
for any impropriety

that may force a resident
into a buyout

or an eviction.

Attie: He'd photograph
their bathrooms,

their pill bottles,
their mail.

He would take pictures of them

sitting there in their pajamas

or partially dressed.

They often said
that he made them

feel like criminals
in their own home.

Barker:
It's very intimidating,

having a stranger
strong‐arming you

to leave your home.

You're talking about shelter.

You're talking about
somebody's home.

Narrator:
Falconite did not respond to repeated requests for comment.

While Attie carefully builds
a civil case against Croman,

she discovers behavior

that triggers
a criminal investigation.

Her colleague, Travis Hill,

takes a deeper dive
into Croman's finances.

He discovers Croman
has inflated his rent rolls

to secure loans of
more than $45 million.

Hill:
He definitely knew the rules.

And if he couldn't get
what he wanted

through legal means,

he would use fraud
and deception

to go about
getting more money.

Narrator: On May 9, 2016,

the Office of the New York
State Attorney General

indicts Steven Croman
on 20 felonies.

They range from grand larceny
to tax fraud.

The scope of this enterprise
was really unlike any other

that we've seen in New York.

Narrator:
Prosecutors also hit Croman with a civil lawsuit,

suing him for forcing tenants

out of
their rent‐regulated units.

The charges are
a long time coming

for Croman's tenants.

The day that he was arrested,
we were relieved.

It was the first time
we were beginning to feel safe.

Narrator:
Croman pleads not guilty.

If convicted, he faces up
to 25 years in prison.

Next on "American Greed"...

will the charges
stick against Croman?

Barker: I think he was shocked

that he was actually charged
with anything

because he had done things
with impunity for so long.

♪♪♪

♪♪♪

Narrator: In May 2016,

the Office of the New York State
Attorney General

charges Steven Croman
with 20 felonies,

including
tax and mortgage fraud.

Prosecutors also sue him
for harassing

and forcing rent‐stabilized
tenants from their homes.

You could tell by the lawyers
he hired to represent him

that he took
the charges seriously.

But I don't think
that he thought

that he would end up
doing any time.

Narrator: Croman's team of
high‐priced defense attorneys

include Benjamin Brafman...

The criminal case has
absolutely nothing whatsoever

to do with
the tenant‐harassment charges.

They're very good advocates.

They're very well experienced.

They understand the law.

They understand the issues.

And they advocated well
for their client.

Narrator:
Croman and the government spend the next year

negotiating a plea agreement.

Though Croman could face
up to 25 years in prison,

Prosecutor Hill
feels the real‐estate mogul

is eerily focused
on the bottom line.

He was always
most concerned about,

"How much money
am I going to have to pay

to get out
from under this?"

Narrator: On June 6, 2017,

Croman pleads guilty
to three felonies.

Hill: So ultimately what we got
Steven Croman for

was him lying to the banks,

falsifying documents
on his loan applications

so that he could
get higher loan amounts,

and then also misrepresenting
his income.

Narrator:
All other charges are dropped.

Croman agrees to serve
one year in jail

and pays
a $5 million tax settlement

for defrauding the state.

Hill: It was unprecedented.

It really was the first case
of a landlord

really being prosecuted

for his real‐estate
business practices

and receiving jail time
for that.

Pinter:
I thought even one year

was an extraordinary
accomplishment.

Landlords, they never pay
a price for anything.

And, and for him
to go to prison,

I thought "great.

This is great."

Narrator:
Some observers point out

the criminal convictions
don't have anything to do

with how Croman
treated his tenants.

The fact that he got
any jail time is something,

but it's also something

that he wasn't actually
charged at all, criminally,

with harassing tenants.

He was charged mainly
with financial crimes.

Under the current law
we were not able to show

and prove tenant harassment
beyond a reasonable doubt.

We couldn't do that,

and it wasn't part
of the indictment.

Narrator: Croman still faces
a civil lawsuit.

He turns himself in
on October 3, 2017

to begin serving time at
the Manhattan Detention Complex.

It's known as "The Tombs."

It's a dramatic fall from grace

for a real‐estate tycoon
worth an estimated $700 million.

And yet, the 51‐year‐old
hardly shows any emotion.

Hill:
His expression never changed

from the day he was arraigned

until the day he was sentenced
and sent off to jail.

His family never showed up,

not for a single court date.

♪♪♪

Narrator: Two months in,

while Croman adjusts
to his new surroundings,

the New York attorney General

announces a settlement
in the civil lawsuit.

A consent decree

requires Croman to pay
$8 million

to a tenant restitution fund,

the largest‐ever settlement
for an individual landlord.

Croman also agrees

to let an independent management
company

run more than 100 of his
residential properties

for five years.

Attie: We sued
Anthony Falconite, as well.

He's not allowed to have
interactions with the tenants

in Mr. Croman's portfolio.

Narrator: Falconite is never
criminally charged.

Pinter: I will remember
the Steve Croman case

as a decisive victory for
the tenants of New York City.

Attie: We know
that the battle doesn't end

when we sign
the settlement agreement.

We're still very committed
to making sure

that he stays in line

and that he complies

with all the different
terms of the agreement.

Narrator: A spokesperson
for Croman's firm, 9300 Realty,

sent the following statement
to "American Greed" ‐‐

"we entered into a comprehensive
settlement agreement

with the state Attorney General,

which we are diligently
implementing

in line with our ongoing focus
on using best practices

to provide quality housing
for our residents."

Croman is released from
The Tombs on June 1, 2018,

after serving eight months.

He's out of jail

and running his business
under supervision

for seven years.

Yet, his critics feel

Croman may resume
business as usual.

You think Croman's going to stop
being vicious and greedy?

I don't think so.

I don't think
he's been converted.

I've prayed for his conversion.

[ Laughing ] But I don't think
it's going to happen.

♪♪♪

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