1 00:00:04,360 --> 00:00:09,680 In this episode of American Greed, everything about Miami businessman 2 00:00:09,680 --> 00:00:15,140 Osorio says, trust me. With Jeb Bush on his board of directors, Hillary Clinton 3 00:00:15,140 --> 00:00:20,840 at his home, and NBA basketball players at his side, Osorio hustles his way to 4 00:00:20,840 --> 00:00:21,479 the top. 5 00:00:21,480 --> 00:00:25,500 Here I am with the president -to -be. What other sealed approval do you need 6 00:00:25,500 --> 00:00:26,740 show the world I'm legitimate? 7 00:00:27,530 --> 00:00:32,030 Cleverly playing to charitable instincts in people, he sets up his victims to 8 00:00:32,030 --> 00:00:33,830 unwittingly sell his lies. 9 00:00:34,250 --> 00:00:38,950 We are rebuilding a future that is so bright, and I'm happy to be a part of 10 00:00:38,950 --> 00:00:44,710 process. Claudio Osorio pretends to be a humanitarian entrepreneur, but he is 11 00:00:44,710 --> 00:00:46,810 not nearly as good as the company he keeps. 12 00:00:47,110 --> 00:00:50,090 And no one can even imagine the truth. 13 00:00:50,490 --> 00:00:53,710 He is a fraudster. This guy's a sociopath. 14 00:01:23,059 --> 00:01:24,300 In 2011, 15 00:01:28,040 --> 00:01:32,800 in a Miami law office, Claudio Osorio sits for a videotaped deposition. 16 00:01:33,320 --> 00:01:35,220 He's asked a simple question. 17 00:01:35,580 --> 00:01:37,060 Was the company ever making money? 18 00:01:38,390 --> 00:01:42,970 If you ask me, okay, I don't know. Every question today, what's the team I'm 19 00:01:42,970 --> 00:01:45,610 asking you? Yeah, I don't know. Yeah, I don't know, Mr. Buckley. I don't know. 20 00:01:45,950 --> 00:01:49,470 The company in question is his own international business. 21 00:01:49,970 --> 00:01:50,970 Did the company lose money? 22 00:01:51,710 --> 00:01:53,190 I don't know one way or another, no. 23 00:01:53,810 --> 00:01:55,110 What is going on here? 24 00:01:55,790 --> 00:01:59,230 How could a CEO not know if his own business is profitable? 25 00:02:00,030 --> 00:02:02,570 If it lost money, do you know whether it lost a little money or a lot of money? 26 00:02:02,850 --> 00:02:04,490 I don't know one way or another, no. 27 00:02:05,200 --> 00:02:07,580 What is Claudio Osorio's game? 28 00:02:08,199 --> 00:02:11,280 For the answer, we need to go back to 1997. 29 00:02:13,640 --> 00:02:16,300 You're the master of achievement. 30 00:02:17,180 --> 00:02:20,140 Bringing life to ideas from your soul. 31 00:02:20,380 --> 00:02:22,340 An awards presentation is underway. 32 00:02:22,940 --> 00:02:24,940 Tonight, we celebrate excellence. 33 00:02:25,480 --> 00:02:29,260 It's the prestigious Ernst and Young Entrepreneur of the Year Award. 34 00:02:30,400 --> 00:02:33,960 Entrepreneur of the Year is... You ready, Lewis? All set. 35 00:02:37,140 --> 00:02:38,660 Claudio Osorio. 36 00:02:41,980 --> 00:02:48,600 Claudio Osorio is 38 years old. He is the founder and CEO of the third largest 37 00:02:48,600 --> 00:02:50,560 computer distributor in the world. 38 00:02:50,980 --> 00:02:57,020 Starting out of a 250 square feet small office in my home country in Caracas, 39 00:02:57,080 --> 00:03:03,940 Venezuela, I would have never dreamed that 12 years later a $5 billion... 40 00:03:06,540 --> 00:03:08,240 It is impressive. 41 00:03:09,200 --> 00:03:13,980 Osorio starts the company CHS Electronics when he is just 25. 42 00:03:15,180 --> 00:03:20,320 Headquartered in Miami, it sells computers anywhere but the U .S. His 43 00:03:20,320 --> 00:03:21,119 is simple. 44 00:03:21,120 --> 00:03:23,600 Buy out the competition wherever he can. 45 00:03:24,500 --> 00:03:28,900 Tonight, as he accepts his award, he is operating in 39 countries. 46 00:03:31,420 --> 00:03:37,680 are made of unlimited energy, of fearless and sheer determination. 47 00:03:38,400 --> 00:03:42,520 At this moment, Claudio Osorio is on top of the world. 48 00:03:43,060 --> 00:03:49,120 And more impressive than his award is his new address, Miami's Star Island. 49 00:03:50,030 --> 00:03:53,790 He had a house just to the left of one of the yachts you see out there. 50 00:03:54,010 --> 00:03:58,610 Business reporter Paul Brinkman says Star Island, home to celebrities and 51 00:03:58,610 --> 00:04:02,290 wealthy CEOs, is a perfect choice for Osorio. 52 00:04:02,490 --> 00:04:07,590 It was a way to build his credibility by saying he lived among those people. It 53 00:04:07,590 --> 00:04:10,670 was a way to meet them. It was a way to get involved in the charity 54 00:04:10,670 --> 00:04:12,610 organizations that they were involved in. 55 00:04:13,930 --> 00:04:18,950 At the end of 1997, as Osorio and his family settle into the world of the rich 56 00:04:18,950 --> 00:04:23,930 and famous on Star Island, computer hardware businesses are heading into 57 00:04:23,930 --> 00:04:27,990 times. But oddly, CHS is doing fine. 58 00:04:29,130 --> 00:04:34,330 CHS was going the opposite way. They were growing both in terms of volume 59 00:04:34,350 --> 00:04:36,670 most importantly, in terms of profitability. 60 00:04:37,610 --> 00:04:42,690 Throughout the next year, Osorio announces record earnings, and CHS 61 00:04:42,930 --> 00:04:47,510 trading on the New York Stock Exchange, soars. He has an explanation. 62 00:04:49,870 --> 00:04:54,490 Osorio says that the people who are in charge of his company in each country 63 00:04:54,490 --> 00:04:57,910 local people who know the business practices of that country. 64 00:04:58,190 --> 00:05:01,410 This year, those local people also know the truth. 65 00:05:01,790 --> 00:05:03,630 Their companies are losing money. 66 00:05:04,320 --> 00:05:09,660 One local manager eventually contacts Glenn DeValerio, an attorney for CHS 67 00:05:09,660 --> 00:05:13,400 shareholders. He says that he and others are suspicious. 68 00:05:14,020 --> 00:05:18,860 They knew that if all of them were reporting downturns in profits, how was 69 00:05:18,860 --> 00:05:22,900 that the company was continuing to report record sales and record earnings? 70 00:05:23,500 --> 00:05:26,940 The answer is what they come to call Claudio's magic. 71 00:05:27,500 --> 00:05:32,640 Submit a statement showing a loss to Osorio in Miami, and presto, that loss 72 00:05:32,640 --> 00:05:33,640 becomes a profit. 73 00:05:34,730 --> 00:05:39,470 It is also called cooking the books, and it's a surefire way to keep a company's 74 00:05:39,470 --> 00:05:40,470 stock on the rise. 75 00:05:41,130 --> 00:05:47,230 And so CHS stock continues to climb, but Osorio's game can't last. 76 00:05:47,650 --> 00:05:53,210 As they got close to the end of the fiscal year, rumors started to surface 77 00:05:53,210 --> 00:05:55,630 some problems with the financial reports. 78 00:05:56,270 --> 00:06:02,470 Osorio must know he will be exposed. And so in March 1999, announcing a find of 79 00:06:02,470 --> 00:06:09,230 discrepancies in its financial reports, he reports that CHS profits in 1998 were 80 00:06:09,230 --> 00:06:12,910 actually millions of dollars lower than originally reported. 81 00:06:13,150 --> 00:06:17,610 And he quickly blames someone else, pointing the finger to Paris, to the 82 00:06:17,610 --> 00:06:20,810 president of European operations, who resigns. 83 00:06:21,210 --> 00:06:26,250 Wall Street learns that not only were the numbers going to have to be 84 00:06:26,330 --> 00:06:31,330 but they were the product of wrongdoing. And that is the kiss of death on Wall 85 00:06:31,330 --> 00:06:32,330 Street. 86 00:06:32,890 --> 00:06:34,450 CHS stock plummets. 87 00:06:34,730 --> 00:06:37,950 Shareholders lose tens of millions of dollars on that one day. 88 00:06:38,330 --> 00:06:42,910 And so they sue, charging Osorio with fraud in civil court. 89 00:06:43,170 --> 00:06:44,910 This was an open and shut case. 90 00:06:45,210 --> 00:06:49,910 The conduct here, once revealed, was very easy to unravel. 91 00:06:50,440 --> 00:06:52,280 There's nothing complicated about the fraud. 92 00:06:52,600 --> 00:06:57,560 The case is settled out of court. The board of directors insurance policy pays 93 00:06:57,560 --> 00:07:02,580 out more than $11 million, which does not come close to the amount lost by 94 00:07:02,580 --> 00:07:03,580 shareholders. 95 00:07:04,160 --> 00:07:05,540 CHS declares bankruptcy. 96 00:07:06,350 --> 00:07:10,870 But there's no real shame in that among the swashbuckling crowd Osorio runs 97 00:07:10,870 --> 00:07:15,570 with. And as long as no one looks closely, no one will discover that many 98 00:07:15,570 --> 00:07:20,590 Osorio's shareholders believe he defrauded them and got away with it. 99 00:07:23,710 --> 00:07:28,430 Next on American Greed, Osorio says he has dreams to house the poor. 100 00:07:28,690 --> 00:07:33,590 But who is he really helping? The fact that Claudio Osorio would divert that 101 00:07:33,590 --> 00:07:39,550 money from helping the Haitian people and save Haitian lives is one of the 102 00:07:39,550 --> 00:07:43,010 despicable, low things that anyone could do. 103 00:07:56,750 --> 00:08:01,990 For four years from his base on Star Island, Claudio Osorio looks for a new 104 00:08:01,990 --> 00:08:03,570 ticket to fame and fortune. 105 00:08:04,490 --> 00:08:10,690 Finally, in 2004, he stumbles on an idea that appears to be the opportunity of a 106 00:08:10,690 --> 00:08:11,690 lifetime. 107 00:08:12,090 --> 00:08:18,390 An inventor in Germany wants to use fiber composite material used in boats 108 00:08:18,390 --> 00:08:20,330 create buildings of all kinds. 109 00:08:20,890 --> 00:08:23,970 Homes, hospitals, office buildings. 110 00:08:25,140 --> 00:08:29,460 Osorio buys the idea and launches his new company in Ovita. 111 00:08:29,700 --> 00:08:34,480 The big selling point was that these fiber composite panels would be more 112 00:08:34,480 --> 00:08:38,880 efficient than using traditional building materials such as wood, steel, 113 00:08:39,080 --> 00:08:40,080 concrete. 114 00:08:41,000 --> 00:08:42,179 Imagine the potential. 115 00:08:42,720 --> 00:08:47,400 For millions of people living in makeshift housing around the world, 116 00:08:47,400 --> 00:08:48,400 offering an answer. 117 00:08:48,680 --> 00:08:53,020 A real home that can be built at little cost in a matter of days. 118 00:08:53,840 --> 00:08:58,280 The buildings are said to be fire resistant, able to withstand hurricanes 119 00:08:58,280 --> 00:08:59,280 even earthquakes. 120 00:09:00,400 --> 00:09:05,160 What he sells to investors is not only a chance to make money, but a chance to 121 00:09:05,160 --> 00:09:06,760 make the world a better place. 122 00:09:07,560 --> 00:09:12,160 Former U .S. Attorney Kendall Coffey represents one of Osorio's investors. 123 00:09:12,760 --> 00:09:17,600 What's unique about Osorio is he targeted people that wanted to do good. 124 00:09:18,080 --> 00:09:22,760 And he appealed to their instincts to try to create a product that could be 125 00:09:22,760 --> 00:09:26,520 transformational and very, very beneficial for millions. 126 00:09:27,860 --> 00:09:34,620 Looking for investors, Osorio turns to Star Island neighbor Engin Yasil, a real 127 00:09:34,620 --> 00:09:39,440 estate developer who sees the potential for Navita housing in his home city of 128 00:09:39,440 --> 00:09:44,780 Istanbul. It was important to him to be able to provide affordable housing in 129 00:09:44,780 --> 00:09:45,780 his own backyard. 130 00:09:46,220 --> 00:09:49,460 This would be a wonderful thing for him to be able to provide this to the 131 00:09:49,460 --> 00:09:50,460 community. 132 00:09:50,780 --> 00:09:57,280 Yaseel invests close to $8 million for a 30 % share in Innovita, and the 133 00:09:57,280 --> 00:09:58,280 business takes off. 134 00:09:59,180 --> 00:10:04,720 Osorio announces a $60 million contract at the Al -Kahil Equine Theme Park in 135 00:10:04,720 --> 00:10:05,720 Dubai. 136 00:10:06,020 --> 00:10:10,900 And that, he says, is on top of contracts in Spain, Portugal, and India. 137 00:10:11,320 --> 00:10:14,940 And an Innovita factory has just opened in Miami. 138 00:10:15,600 --> 00:10:19,500 Having the product itself here in North Miami Beach and investors were able to 139 00:10:19,500 --> 00:10:23,840 walk through it, see it, touch it, envision it in the state that they were 140 00:10:23,840 --> 00:10:26,420 to implement it, that was a huge selling point. 141 00:10:26,900 --> 00:10:32,160 The company is on a roll, and it gives Osorio the ability to attract a stellar 142 00:10:32,160 --> 00:10:33,160 board of directors. 143 00:10:33,800 --> 00:10:40,400 Miami developer Jorge Perez, retired General Wesley Clark, and the big get, 144 00:10:40,400 --> 00:10:42,760 former governor of Florida, Jeb Bush. 145 00:10:43,320 --> 00:10:47,320 who is paid $15 ,000 a month as a consultant and board member. 146 00:10:47,720 --> 00:10:49,540 The board of directors was an all -star cast. 147 00:10:49,840 --> 00:10:55,800 People loved the concept of Inivida. What it could do in third world 148 00:10:55,800 --> 00:10:59,260 is something that I think everybody would stand behind. 149 00:11:01,140 --> 00:11:06,600 Selling the company with Osorio is his partner, his wife, Amaryllis, who casts 150 00:11:06,600 --> 00:11:08,720 herself as a compassionate humanitarian. 151 00:11:11,230 --> 00:11:15,810 She says she believes that every person has the responsibility with the world 152 00:11:15,810 --> 00:11:19,750 and with God to give, especially when you have so much. 153 00:11:20,410 --> 00:11:25,490 That's why she raises money for orphanages in Siberia and daycare 154 00:11:25,490 --> 00:11:26,490 Venezuela. 155 00:11:28,270 --> 00:11:32,850 Closer to home, she raises money for Hillary Clinton during her 2008 campaign 156 00:11:32,850 --> 00:11:33,850 for president. 157 00:11:34,730 --> 00:11:39,130 And that is how she meets Chris Korge, a millionaire real estate developer and 158 00:11:39,130 --> 00:11:41,430 longtime supporter of Bill and Hillary. 159 00:11:42,030 --> 00:11:48,270 What I brought to the table was the prize of all prizes on the Democratic 160 00:11:48,470 --> 00:11:51,770 I brought the Clinton -Obama race. 161 00:11:52,570 --> 00:11:58,110 In the fall of 2007, as Amaryllis and Korge plan a fundraiser for Clinton at 162 00:11:58,110 --> 00:12:01,610 Osorio's house, Korge gets to know Claudio. 163 00:12:02,040 --> 00:12:06,500 With the backdrop of seeing him interact with his own children, he looked to me 164 00:12:06,500 --> 00:12:08,560 like, you know, father knows best. 165 00:12:08,840 --> 00:12:11,420 You know, almost like a perfect kind of father. 166 00:12:14,620 --> 00:12:19,720 A turning point comes in June 2008 when Clinton concedes the Democratic 167 00:12:19,720 --> 00:12:24,480 nomination to Barack Obama and supporters of the former opponents need 168 00:12:24,480 --> 00:12:25,620 peace with each other. 169 00:12:26,160 --> 00:12:30,640 Korg is impressed by what he sees as Osorio's sense of fair play. 170 00:12:31,180 --> 00:12:37,300 What Claudio did was he invited us all to lunch at his house one day and kind 171 00:12:37,300 --> 00:12:43,060 mediated in such a way, talking to the Obama folks that, you know, we need to 172 00:12:43,060 --> 00:12:44,060 come together here. 173 00:12:44,120 --> 00:12:50,840 So that was another factor to me that said to me, this is a really good guy. 174 00:12:50,980 --> 00:12:55,060 You know, good family, strong board of directors. 175 00:12:55,740 --> 00:12:57,960 I couldn't find a lot wrong with the picture. 176 00:12:58,970 --> 00:13:02,410 And there seems to be nothing in his past to cause any concern. 177 00:13:02,910 --> 00:13:09,870 Jeb Bush hired a private investigator to investigate Osorio, Innovita, to make 178 00:13:09,870 --> 00:13:16,570 sure that he wasn't getting involved in a company or with individuals that would 179 00:13:16,570 --> 00:13:19,710 create political problems for him in the future. 180 00:13:20,370 --> 00:13:24,690 The allegations of fraud at CHS do not raise red flags. 181 00:13:25,470 --> 00:13:27,150 At least, not yet. 182 00:13:29,270 --> 00:13:35,390 Next on American Greed, Claudio turns 50 and his well -wishers turn out. Happy 183 00:13:35,390 --> 00:13:37,930 birthday. Happy 50th. We're at your house right now. 184 00:13:56,240 --> 00:14:01,100 By 2008, as the world teeters on the brink of the Great Recession, Claudio 185 00:14:01,100 --> 00:14:04,160 Amaryllis Osorio appear to have nothing to worry about. 186 00:14:05,420 --> 00:14:10,800 Living on Star Island, there is a Maserati in the garage and an expensive 187 00:14:10,800 --> 00:14:11,639 at the dock. 188 00:14:11,640 --> 00:14:16,220 And who can miss that diamond ring that Amaryllis displays so prominently? 189 00:14:16,780 --> 00:14:20,960 They were spending $100 ,000 to $200 ,000 on a credit card every month. 190 00:14:21,400 --> 00:14:23,120 They had an apartment complex in Switzerland. 191 00:14:23,340 --> 00:14:26,680 They had another apartment complex in Telluride, Colorado. 192 00:14:27,760 --> 00:14:32,920 But they always need more money. And together, Amarillo and Claudio are 193 00:14:32,920 --> 00:14:37,560 every possible source of cash for Innovita. And now they are making their 194 00:14:37,560 --> 00:14:38,900 into a whole new league. 195 00:14:39,620 --> 00:14:40,620 The NBA. 196 00:14:41,340 --> 00:14:46,320 Reaching out to star players like Dwight Howard, Alonzo Mourning, Howard Isley, 197 00:14:46,420 --> 00:14:47,560 and Carlos Boozer. 198 00:14:48,260 --> 00:14:50,460 In 08, there were several. 199 00:14:50,940 --> 00:14:54,080 professional athletes that were introduced to Mr. Osorio. 200 00:14:54,560 --> 00:14:59,200 Attorney David Nunez represents Carlos Boozer and his wife, Cindy. 201 00:14:59,440 --> 00:15:05,000 Mr. Osorio presented as a very successful, wealthy, savvy international 202 00:15:05,000 --> 00:15:06,000 businessman. 203 00:15:07,560 --> 00:15:12,260 In late spring, the Boozers and other potential investors are invited to a 204 00:15:12,260 --> 00:15:16,100 presentation on Innovita at the Osorio Star Island House. 205 00:15:16,780 --> 00:15:20,920 Just the fact that he had a residence there already lent him some credibility. 206 00:15:21,740 --> 00:15:23,360 And so does his resume. 207 00:15:24,420 --> 00:15:28,440 Entrepreneur of the year. Former CEO of a Fortune 500 company. 208 00:15:29,120 --> 00:15:33,920 That in and of itself lends him tremendous credibility and makes him a 209 00:15:33,920 --> 00:15:35,800 child. Really, I mean, he's a whiz. 210 00:15:36,700 --> 00:15:41,860 And then there is Innovita, already operating around the world. It could not 211 00:15:41,860 --> 00:15:42,860 more impressive. 212 00:15:43,320 --> 00:15:47,860 Of course, a selling point is the involvement of someone like Jeb Bush. 213 00:15:48,200 --> 00:15:53,460 It gives you a sense of comfort because one can't imagine individuals of that 214 00:15:53,460 --> 00:15:55,760 stature just nilly -willy getting involved. 215 00:15:56,260 --> 00:15:59,200 But best of all is the financial picture. 216 00:16:00,380 --> 00:16:04,260 Osorio presents a company doing a booming business with a stunning amount 217 00:16:04,260 --> 00:16:05,260 cash on hand. 218 00:16:05,760 --> 00:16:09,100 It was $40 million in reserves, debt -free. 219 00:16:09,630 --> 00:16:13,570 A pipeline of construction projects worth hundreds of millions of dollars in 220 00:16:13,570 --> 00:16:16,190 works and gaining global recognition. 221 00:16:16,870 --> 00:16:19,130 The entire pitch was a masterpiece. 222 00:16:19,510 --> 00:16:23,570 He had all the pieces in place to persuade everybody that, you know, if 223 00:16:23,570 --> 00:16:25,410 didn't do this, you really are missing the boat. 224 00:16:27,190 --> 00:16:32,050 Finally, the kicker of the presentation to investors is an invitation to a 225 00:16:32,050 --> 00:16:36,570 private meeting arranged by the Osorios with then -candidate for president 226 00:16:36,570 --> 00:16:37,750 Barack Obama. 227 00:16:38,520 --> 00:16:43,060 It will be held at the home of Chris Korge, and Osorio makes sure his 228 00:16:43,060 --> 00:16:45,220 investors get special treatment. 229 00:16:45,780 --> 00:16:52,780 Claudio organized at my house a private meeting with, at the time, Senator Obama 230 00:16:52,780 --> 00:16:59,540 and all of these NBA players like Carlos Buzer. Because of something like that, 231 00:16:59,700 --> 00:17:05,780 it raised the level of credibility that Claudio Osorio had. 232 00:17:06,970 --> 00:17:09,810 Osorio can arrange a private meeting with Barack Obama? 233 00:17:10,250 --> 00:17:11,250 That's impressive. 234 00:17:11,630 --> 00:17:13,190 It's like catching the big fish. 235 00:17:13,490 --> 00:17:16,210 Here I am with the president -to -be. That's a big deal. 236 00:17:16,470 --> 00:17:20,329 What other shield of approval do you need to show the world I'm legitimate? 237 00:17:22,450 --> 00:17:23,450 What else? 238 00:17:24,390 --> 00:17:25,390 Nothing else. 239 00:17:25,589 --> 00:17:30,650 And eventually Dwight Howard, Howard Isley, and Alonzo Mourning invest in 240 00:17:30,650 --> 00:17:31,650 Innovita. 241 00:17:32,680 --> 00:17:37,300 For Cindy and Carlos Boozer, the decision to put their money into the 242 00:17:37,300 --> 00:17:38,299 not easy. 243 00:17:38,300 --> 00:17:42,160 These folks are folks that are hardworking, that value what they have. 244 00:17:42,580 --> 00:17:44,920 Mind you, he wasn't drafted in the first round. 245 00:17:45,320 --> 00:17:48,300 Second round draft picks don't get guaranteed contracts. 246 00:17:49,100 --> 00:17:53,500 He had to work hard to earn what he became in the NBA. 247 00:17:54,460 --> 00:17:56,980 And so Osorio plays it cool. 248 00:17:57,480 --> 00:18:00,340 He calls Carlos not to ask. 249 00:18:00,760 --> 00:18:04,500 for him to invest but to say to him hey you know what there's a program called 250 00:18:04,500 --> 00:18:09,780 nba cares and this program does a lot of work in africa i want to donate homes 251 00:18:09,780 --> 00:18:15,480 to that program he does it to back off from the aggressive solicitation and to 252 00:18:15,480 --> 00:18:18,920 show that you know what you don't have to invest but just let me help this 253 00:18:18,920 --> 00:18:25,850 it works in august 2009 the boozers invest one million dollars Buying more 254 00:18:25,850 --> 00:18:31,350 than 5 million shares of Innovita at the bargain price of 19 .5 cents a share. 255 00:18:33,390 --> 00:18:35,850 The money is coming in from all over. 256 00:18:36,150 --> 00:18:39,630 A developer in New York has given Osorio a million dollars. 257 00:18:40,330 --> 00:18:45,390 Another in Tanzania is investing 2 million dollars in an Innovita project 258 00:18:45,390 --> 00:18:47,910 build floating villas in Hamburg, Germany. 259 00:18:49,580 --> 00:18:53,700 And finally, Osorio turns his attention to Chris Korge. 260 00:18:54,000 --> 00:18:58,900 He said, look, you're trustworthy and you're smart and you're engaged. You 261 00:18:58,900 --> 00:18:59,900 about the community. 262 00:19:00,200 --> 00:19:03,880 I would love for you to be part of the company. And you don't have to make a 263 00:19:03,880 --> 00:19:07,400 investment. Make whatever investment you feel comfortable with. 264 00:19:07,620 --> 00:19:10,360 And he shows Korge the financial statements. 265 00:19:10,660 --> 00:19:14,040 As anyone would, I focus on the numbers. 266 00:19:14,680 --> 00:19:18,920 Not on some small words that I can't see without glasses. 267 00:19:19,340 --> 00:19:21,920 Okay, I mean, I have to squint to look at the numbers. 268 00:19:22,300 --> 00:19:28,840 And the numbers say that in 2008, the company has $37 million in cash, and 269 00:19:28,840 --> 00:19:33,300 it will end 2009 with $39 million also in cash. 270 00:19:33,700 --> 00:19:37,260 So you're seeing numbers that follow the story. 271 00:19:38,140 --> 00:19:42,900 What Korge doesn't see without his glasses is the word in the top right 272 00:19:42,900 --> 00:19:43,900 corner. 273 00:19:44,290 --> 00:19:47,230 Unaudited. There is nothing official about this document. 274 00:19:47,610 --> 00:19:51,870 And what he doesn't know is that in Dubai, checks written from Innovita are 275 00:19:51,870 --> 00:19:52,870 reportedly bouncing. 276 00:19:53,510 --> 00:19:57,790 And that Amaryllis is asking Innovita employees to take a cut in pay. 277 00:19:58,720 --> 00:20:02,480 And that the Swiss government has opened a criminal investigation into 278 00:20:02,480 --> 00:20:08,440 allegations that at CHS, Osorio created false financial statements in order to 279 00:20:08,440 --> 00:20:13,120 obtain $220 million in loans from Swiss banks. 280 00:20:13,420 --> 00:20:18,840 That is not widely known. And everything that Chris Cord sees looks as good as 281 00:20:18,840 --> 00:20:19,819 it gets. 282 00:20:19,820 --> 00:20:25,620 After seeing the financials and seeing the board and the entire picture, I 283 00:20:25,620 --> 00:20:28,960 thought, I'll invest $300 ,000 in the company. 284 00:20:29,180 --> 00:20:30,840 That'd be a good starting point. 285 00:20:31,140 --> 00:20:34,420 And it wasn't like he was hunting me down to get the check. 286 00:20:34,840 --> 00:20:39,740 Gorge buys 1 ,250 ,000 shares in Innovita. 287 00:20:43,560 --> 00:20:47,360 Two months later, it is Osorio's 50th birthday party. 288 00:20:47,770 --> 00:20:50,170 And this crowd of well -wishers is impressive. 289 00:20:50,530 --> 00:20:54,490 You have many, many happy, healthy birthdays, Mark, and that we're there to 290 00:20:54,490 --> 00:20:56,550 share it with you. He's got an incredible vision. 291 00:20:56,910 --> 00:20:59,630 He's driven, hardworking. 292 00:20:59,890 --> 00:21:02,770 Happy birthday. Happy 50th. We're at your house right now. 293 00:21:02,970 --> 00:21:04,710 We want to wish you a happy birthday. 294 00:21:05,230 --> 00:21:06,590 We love you. We're proud of you. 295 00:21:07,510 --> 00:21:08,510 Let's go get drunk. 296 00:21:12,970 --> 00:21:17,510 Chris Korg is there, and it is not at all the most extravagant 50th birthday 297 00:21:17,510 --> 00:21:18,770 party he has seen. 298 00:21:19,050 --> 00:21:19,949 It was nice. 299 00:21:19,950 --> 00:21:22,270 Sure, it cost, you know, $100 ,000. 300 00:21:23,010 --> 00:21:26,950 But, I mean, he's got $39 million in cash sitting in one of the companies, 301 00:21:26,950 --> 00:21:29,050 he owns 98 % of all the stock. 302 00:21:29,730 --> 00:21:33,790 So in Korg's mind, Osorio has money to burn on his birthday. 303 00:21:34,370 --> 00:21:37,490 He just doesn't know it's his money that he's burning. 304 00:21:41,500 --> 00:21:47,080 Next on American Greed, turning a natural disaster into opportunity, as 305 00:21:47,080 --> 00:21:48,600 Claudio Osorio can. 306 00:21:48,940 --> 00:21:52,780 Along comes Osorio, and he says, I will do something in Haiti. I will build 307 00:21:52,780 --> 00:21:53,780 homes. 308 00:22:14,440 --> 00:22:16,280 January 12, 2010. 309 00:22:16,660 --> 00:22:21,060 The attention of the world turns to a crisis of immense proportions in Haiti. 310 00:22:21,580 --> 00:22:27,100 A 7 .0 magnitude earthquake has destroyed the capital city of Port -au 311 00:22:27,500 --> 00:22:29,700 Hundreds of thousands of people are killed. 312 00:22:30,000 --> 00:22:32,180 More than one million are homeless. 313 00:22:34,260 --> 00:22:38,000 And Claudio Osorio steps in to seize the moment. 314 00:22:38,760 --> 00:22:43,240 He borrows a private jet from a New York investor and brings his team. 315 00:22:43,800 --> 00:22:48,900 With Chris Korge, Alonzo Mourning, and retired General Wesley Clark front and 316 00:22:48,900 --> 00:22:50,820 center right to the heart of the crisis. 317 00:22:51,380 --> 00:22:56,960 The purpose was to bring medicine that was desperately needed there to save 318 00:22:56,960 --> 00:22:57,960 lives. 319 00:22:59,480 --> 00:23:05,140 Literally, you couldn't leave there without tearing up to seeing that 320 00:23:05,140 --> 00:23:07,120 devastation and carnage. 321 00:23:07,420 --> 00:23:09,480 And to see people in these tents. 322 00:23:10,260 --> 00:23:13,060 For Osorio, it all spells one thing. 323 00:23:14,180 --> 00:23:15,180 Opportunity. 324 00:23:22,240 --> 00:23:26,980 Returning to the U .S., Osorio calls a press conference to announce that 325 00:23:26,980 --> 00:23:29,520 will donate 1 ,000 homes to Haiti. 326 00:23:29,820 --> 00:23:32,780 His believers put their reputations on the line for him. 327 00:23:41,620 --> 00:23:44,080 And I'm happy to be a part of the process. 328 00:23:44,480 --> 00:23:46,780 The national media picks up the story. 329 00:23:47,120 --> 00:23:49,480 Claudio Osorio is headline news. 330 00:23:50,360 --> 00:23:55,640 Armed with good press and impeccable credentials, he heads to Washington for 331 00:23:55,640 --> 00:24:00,760 meeting with the Overseas Private Investment Corporation, OPIC, a 332 00:24:00,760 --> 00:24:05,020 agency that helps U .S. businesses invest in worthwhile projects in the 333 00:24:05,020 --> 00:24:06,020 developing world. 334 00:24:06,080 --> 00:24:10,700 He's looking for a loan to help Innovita build a factory in Haiti. 335 00:24:11,210 --> 00:24:15,470 There was clearly a desire and a sense of urgency on the part of the federal 336 00:24:15,470 --> 00:24:19,590 government to do something in Haiti at that time. And along comes Osorio, and 337 00:24:19,590 --> 00:24:22,030 says, I will do something in Haiti. I will build homes. 338 00:24:23,130 --> 00:24:27,970 He presents his financial statements with that stunning figure of cash on 339 00:24:28,210 --> 00:24:29,430 $39 million. 340 00:24:30,410 --> 00:24:35,230 And just two weeks after the earthquake, OPIC announces a $10 million loan to 341 00:24:35,230 --> 00:24:39,190 Innovita. Osorio gets more than $3 million to start. 342 00:24:41,040 --> 00:24:45,380 Working hand -in -hand with Osorio and all of the company's business now is 343 00:24:45,380 --> 00:24:48,860 Chris Korch, who has invested over $300 ,000. 344 00:24:49,720 --> 00:24:51,940 We were in touch three times a day. 345 00:24:52,140 --> 00:24:58,320 We saw each other four times a week. We told each other about very personal, 346 00:24:58,480 --> 00:25:05,020 family -related things, you know, successes and challenges in our 347 00:25:05,060 --> 00:25:09,520 with our children, the good, the bad, the ugly. 348 00:25:10,160 --> 00:25:14,260 And so Osorio knows Corge is worried about his real estate business. 349 00:25:14,560 --> 00:25:16,640 The market in Florida has crashed. 350 00:25:16,980 --> 00:25:21,480 He owes $28 million on properties worth approximately $5 million. 351 00:25:21,960 --> 00:25:28,260 One of the things that he was an expert at was as a concerned friend, he wanted 352 00:25:28,260 --> 00:25:31,340 to know how he could help me. 353 00:25:32,000 --> 00:25:35,500 And that further endeared him with me. 354 00:25:36,400 --> 00:25:39,280 And suddenly an opportunity presents itself. 355 00:25:39,630 --> 00:25:44,470 Rosario says a group of sovereign wealth funds in the Middle East wants to buy 356 00:25:44,470 --> 00:25:47,730 20 % of Innovita for $500 million. 357 00:25:48,290 --> 00:25:55,050 It is not that far -fetched. Governor Bush had told me that he had gone to the 358 00:25:55,050 --> 00:26:01,970 Middle East and actually saw a floating home that was built, I think, in 359 00:26:01,970 --> 00:26:05,290 Abu Dhabi, and that he had seen the factory in the middle. 360 00:26:06,460 --> 00:26:10,780 Osorio says the deal will create a huge windfall for Innovita's investors. 361 00:26:11,180 --> 00:26:15,760 He says courage can make a killing, especially if he buys more Innovita 362 00:26:16,240 --> 00:26:19,920 I didn't know what I could afford to buy. I mean, I had to meet all my other 363 00:26:19,920 --> 00:26:21,340 financial obligations. 364 00:26:22,620 --> 00:26:25,080 And so Osorio sweetens the pot. 365 00:26:25,320 --> 00:26:30,360 He says he will be getting more than $400 million when the deal closes, and 366 00:26:30,360 --> 00:26:31,360 is willing to share. 367 00:26:31,840 --> 00:26:33,380 He goes, I don't need this money. 368 00:26:33,920 --> 00:26:37,720 He goes, whatever you can raise, I'll match it for you. 369 00:26:37,960 --> 00:26:39,960 It's a gift almost, okay? 370 00:26:40,940 --> 00:26:42,580 The hook has been set. 371 00:26:42,900 --> 00:26:44,140 Cord wants in. 372 00:26:44,600 --> 00:26:46,800 Problem is, he doesn't have the cash. 373 00:26:47,540 --> 00:26:51,200 So in March 2010, he borrows $3 million. 374 00:26:52,160 --> 00:26:57,440 Combining that with money of his own, he invests $3 .7 million, believing the 375 00:26:57,440 --> 00:27:00,100 deal will close in just over a month. 376 00:27:00,670 --> 00:27:05,690 I felt like this guy was doing me the biggest favor ever that anyone's ever 377 00:27:05,690 --> 00:27:06,690 for me. 378 00:27:07,610 --> 00:27:11,510 Meanwhile, the homes Osorio promised for the survivors of the Haiti earthquake 379 00:27:11,510 --> 00:27:13,910 should be nearing completion by now. 380 00:27:14,430 --> 00:27:19,370 I worked for a number of weeks trying to get answers out of Inabida at that 381 00:27:19,370 --> 00:27:23,610 point and saying, you know, are you really building homes in Haiti? And they 382 00:27:23,610 --> 00:27:25,630 would say yes. Then I would say, well, send me some pictures. 383 00:27:25,950 --> 00:27:28,190 Tell me where the homes are in Haiti. 384 00:27:29,630 --> 00:27:31,270 OPIC is asking, too. 385 00:27:31,510 --> 00:27:36,150 When Osorio reports that he has completed 60 homes, the agency's local 386 00:27:36,150 --> 00:27:38,050 representative heads out to see them. 387 00:27:38,630 --> 00:27:42,090 She writes back, I didn't see any constructed homes. 388 00:27:42,990 --> 00:27:47,830 OPIC decides to hold off on sending any more money to Claudio Osorio. 389 00:27:48,250 --> 00:27:53,630 I remember thinking, is it really possible that somebody could claim they 390 00:27:53,630 --> 00:27:57,810 going to do such a wonderful thing and then... 391 00:27:58,090 --> 00:28:00,690 Have no intention of doing that and just take your money instead. 392 00:28:03,410 --> 00:28:07,250 Next on American Greed, Osorio's real talent. 393 00:28:07,710 --> 00:28:10,370 He never showed tension. He never showed fear. 394 00:28:10,750 --> 00:28:12,870 Osorio was the best liar I've ever seen. 395 00:28:13,210 --> 00:28:19,290 Watch Osorio dodge the truth at cnbcprime .com slash American Greed. 396 00:28:19,570 --> 00:28:21,730 Want inside information from the show? 397 00:28:22,430 --> 00:28:24,190 Join the Greed social network. 398 00:28:24,670 --> 00:28:27,250 Like us on the American Greed Facebook page. 399 00:28:27,930 --> 00:28:28,930 We'll be right back. 400 00:28:35,770 --> 00:28:42,530 In the spring of 2010 in Coral Gables, Chris Cord says he is paying $25 ,000 a 401 00:28:42,530 --> 00:28:45,190 month in interest on a $3 million loan. 402 00:28:45,710 --> 00:28:49,770 He has borrowed the money in the hope that it will free him from an even 403 00:28:49,770 --> 00:28:54,630 debt. Even though I made a fantastic income, I couldn't pay off. 404 00:28:55,920 --> 00:28:57,720 $28 million in loans. 405 00:28:58,000 --> 00:29:00,180 I didn't have that kind of cash. 406 00:29:00,420 --> 00:29:02,800 And I personally guaranteed all these loans. 407 00:29:03,100 --> 00:29:07,120 So this was my Hail Mary path. 408 00:29:07,920 --> 00:29:12,860 He expects to pay the $3 million loan back as soon as a group of Middle 409 00:29:12,860 --> 00:29:17,980 investors finalize their $500 million purchase of shares in Innovita. 410 00:29:18,240 --> 00:29:23,100 The Sovereign Wealth Fund was supposed to close by May 5th. So May 5th came. 411 00:29:24,350 --> 00:29:29,730 And I wasn't terribly alarmed. I was talking to Claudio frequently, almost 412 00:29:29,730 --> 00:29:31,150 day up until the 5th. 413 00:29:31,950 --> 00:29:37,130 After almost two weeks, I called Claudio, and I said, Claudio, what's 414 00:29:37,170 --> 00:29:41,350 He goes, it's just, you know, lawyers, they take forever to get this done. 415 00:29:41,590 --> 00:29:43,670 And then I started hearing less from him. 416 00:29:43,910 --> 00:29:48,610 And so Kort calls Inovita's chief financial officer to see what he knows 417 00:29:48,610 --> 00:29:50,110 the sovereign wealth fund. 418 00:29:50,550 --> 00:29:53,710 He goes, oh, those sovereign wealth funds from the Middle East? 419 00:29:54,090 --> 00:29:59,510 When we met with them back in February, they told us that the company wasn't 420 00:29:59,510 --> 00:30:03,350 developed enough yet for them to invest in the company. 421 00:30:03,850 --> 00:30:05,910 Well, my heart dropped. 422 00:30:07,650 --> 00:30:13,630 His next call is to Osorio, who quickly tells Corge the CFO is not in on the 423 00:30:13,630 --> 00:30:15,050 deal and knows nothing. 424 00:30:15,410 --> 00:30:17,430 I said to him, Claudio. 425 00:30:17,770 --> 00:30:22,710 If this deal doesn't close in the next 30 days, I need all my money back. He 426 00:30:22,710 --> 00:30:25,130 goes, Chris, if you want all your money back, I'll give it all back to you. 427 00:30:26,130 --> 00:30:27,130 Corge waits. 428 00:30:28,150 --> 00:30:29,790 June, no deal. 429 00:30:30,490 --> 00:30:32,550 July, no deal. 430 00:30:33,170 --> 00:30:36,150 And now Osorio is impossible to reach. 431 00:30:36,590 --> 00:30:42,030 In July, he tells Corge he is in Venezuela, but he is seen in Martha's 432 00:30:42,510 --> 00:30:47,870 In August, Amarillo sends Corge a text saying Claudio is out of the country and 433 00:30:47,870 --> 00:30:53,250 she is in New Orleans. And they are seen having lunch at Prime 112 in Miami 434 00:30:53,250 --> 00:30:58,430 Beach. When Osorio says he is visiting his father who has had a stroke, he 435 00:30:58,430 --> 00:31:00,130 the lie just a little too far. 436 00:31:00,490 --> 00:31:07,150 When the guy sent me... A picture of a man in a bed with tubes 437 00:31:07,150 --> 00:31:10,550 coming out of his throat and oxygen masks. 438 00:31:10,850 --> 00:31:14,230 I thought to myself, oh, my God, I am so done. 439 00:31:14,430 --> 00:31:20,010 This guy has taken me, you know, who would do something like that? 440 00:31:20,370 --> 00:31:22,110 And the evidence mounts. 441 00:31:23,370 --> 00:31:27,130 Osorio's Star Island neighbor, Nguyen Yaseel, is suing him. 442 00:31:27,850 --> 00:31:33,790 He wants his $8 million back because he discovers Osorio's entire sales pitch is 443 00:31:33,790 --> 00:31:40,330 not true. What he found out was that the cost that Osorio claimed would be 444 00:31:40,330 --> 00:31:47,050 attended to these prefabricated panels to be able to build a home was way, 445 00:31:47,190 --> 00:31:48,490 way, way, way, way off. 446 00:31:49,310 --> 00:31:53,650 And that businessman in Tanzania who put in two million to invest in a floating 447 00:31:53,650 --> 00:31:58,630 village is in court saying Osorio never sold a single floating home. 448 00:31:58,870 --> 00:32:00,210 He wants his money back. 449 00:32:01,390 --> 00:32:05,350 Finally, in September, Chris Courage files a lawsuit against Claudio and 450 00:32:05,350 --> 00:32:10,490 Amaryllis. His lawyer, Kendall Coffey, sets up a meeting with Osorio. 451 00:32:10,910 --> 00:32:15,470 Claudio basically said, look, clearly our relationship has... 452 00:32:15,710 --> 00:32:17,350 been severely damaged. 453 00:32:17,730 --> 00:32:18,730 Ta -da! 454 00:32:20,090 --> 00:32:21,090 Severely damaged. 455 00:32:21,570 --> 00:32:23,290 I want to kill him, okay? 456 00:32:23,870 --> 00:32:27,130 And so he says, so I'll just get him his money back. 457 00:32:27,930 --> 00:32:30,010 Osorio was the best liar I've ever seen. 458 00:32:30,270 --> 00:32:37,030 He could look at you eye to eye, not a flinch, not a whisper of weakness 459 00:32:37,030 --> 00:32:40,790 or any possibility that he could be doing anything wrong. 460 00:32:41,750 --> 00:32:44,390 Cord received nothing from Osorio. 461 00:32:45,550 --> 00:32:50,670 And as news of his lawsuit hits the press, Amaryllis flies into action, 462 00:32:50,670 --> 00:32:52,730 up a lunch meeting with Cindy Boozer. 463 00:32:53,010 --> 00:32:59,690 She said that Korg was behind this campaign to extort Innovita, to give him 464 00:32:59,690 --> 00:33:05,690 300 % of his original $4 million investment, but to don't worry, we have 465 00:33:05,690 --> 00:33:07,010 million deal with China. 466 00:33:07,410 --> 00:33:12,530 I've seen the project. I've seen it constructed and being worked on. I 467 00:33:12,530 --> 00:33:14,010 personally went there myself. 468 00:33:15,630 --> 00:33:21,290 As the court proceedings in Corge's suit begin, the focus is on that $39 million 469 00:33:21,290 --> 00:33:22,290 in cash. 470 00:33:22,570 --> 00:33:24,990 It's time to show Corge the money. 471 00:33:25,270 --> 00:33:30,130 From the beginning of the litigation, Osorio was assuring the court that the 472 00:33:30,130 --> 00:33:33,250 money was there and that there would be documents to prove it. 473 00:33:33,570 --> 00:33:37,810 But he stonewalls. He refuses to submit his financial records. 474 00:33:38,550 --> 00:33:42,410 Osorio was clearly just trying to fight to live another day and would say 475 00:33:42,410 --> 00:33:46,890 anything and do anything if he could just buy a little more time. 476 00:33:47,530 --> 00:33:49,870 By March, the judge has had enough. 477 00:33:50,130 --> 00:33:55,790 She orders Osorio to pay $4 million to Corge. And she goes a step further. 478 00:33:55,990 --> 00:33:58,750 She appoints a receiver to take over in Evita. 479 00:33:59,710 --> 00:34:03,090 Claudio Osorio is no longer in charge. 480 00:34:04,810 --> 00:34:06,410 Next on American Greed. 481 00:34:06,990 --> 00:34:09,710 The entrepreneur of the year plays it dumb. 482 00:34:10,070 --> 00:34:11,330 Have you ever looked at a bank statement? 483 00:34:12,590 --> 00:34:13,610 That's a lay person. 484 00:34:13,949 --> 00:34:17,010 Do you think you need to be an expert to understand a bank statement? 485 00:34:18,290 --> 00:34:20,150 I think so, yes. 486 00:34:33,480 --> 00:34:40,340 In March 2011 in Miami Beach at Inovita headquarters, Claudio Osorio is out, 487 00:34:40,400 --> 00:34:43,300 and court -appointed attorneys take control. 488 00:34:43,699 --> 00:34:48,840 We went in and told them that we are now under court order and secured the 489 00:34:48,840 --> 00:34:53,780 computers, secured papers, and basically locked down the offices. 490 00:34:54,739 --> 00:34:59,840 As the lawyers pour through the records, it is immediately clear that Osorio's 491 00:34:59,840 --> 00:35:02,780 promising profitable company with wads of cash... 492 00:35:03,130 --> 00:35:04,069 is broke. 493 00:35:04,070 --> 00:35:08,170 They're unpaid creditors, probably over a million dollars unpaid bills. 494 00:35:09,110 --> 00:35:13,270 Unable to make payroll, the attorneys shut down the Miami factory. 495 00:35:13,550 --> 00:35:18,070 And they learned that despite the claims of factories operating around the 496 00:35:18,070 --> 00:35:20,970 world, there is just one other in Dubai. 497 00:35:21,670 --> 00:35:26,530 All the press of having factories in Mississippi and Oman and Angola and 498 00:35:26,530 --> 00:35:28,330 Tanzania was just noise. 499 00:35:28,950 --> 00:35:32,330 But there is still that $39 million in cash. 500 00:35:33,020 --> 00:35:36,040 Some of the first documents we found were indications that there were 501 00:35:36,040 --> 00:35:40,940 substantial sums in the bank. We found an IRS form which indicated there was 502 00:35:40,940 --> 00:35:43,400 .5 million in an offshore account. 503 00:35:46,000 --> 00:35:49,440 They call Osorio in for a deposition in May. 504 00:35:49,840 --> 00:35:53,600 When you were operating the Inovita entities, did you typically have an 505 00:35:53,600 --> 00:35:57,800 understanding on a given day approximately how much cash any of the 506 00:35:57,800 --> 00:35:58,800 had? No. 507 00:35:59,630 --> 00:36:03,470 You claim that he didn't understand finance, did not understand bank 508 00:36:03,870 --> 00:36:05,350 Have you ever looked at a bank statement? 509 00:36:05,830 --> 00:36:06,890 That's a lay person. 510 00:36:07,170 --> 00:36:10,290 Do you think you need to be an expert to understand a bank statement? 511 00:36:11,450 --> 00:36:13,490 I think so, yes. 512 00:36:15,150 --> 00:36:20,010 The documents the attorneys find suggest the money is in the Royal Bank of 513 00:36:20,010 --> 00:36:21,830 Canada in the Cayman Islands. 514 00:36:22,210 --> 00:36:23,950 But Osorio knows nothing. 515 00:36:24,330 --> 00:36:26,770 Did money ever get deposited into RBC Cayman? 516 00:36:27,670 --> 00:36:28,970 I don't know that one way or another. 517 00:36:29,850 --> 00:36:32,150 Did money ever get spent out of RBC Cayman? 518 00:36:33,550 --> 00:36:38,690 Again, not my area, but we know. I don't know that one way or another. 519 00:36:39,270 --> 00:36:42,510 Eventually, Osorio is asked the big question. 520 00:36:42,950 --> 00:36:47,910 Do you have any reason to believe that at any time, in connection with your 521 00:36:47,910 --> 00:36:52,210 involvement and relationship with the individual entities, that you ever 522 00:36:52,210 --> 00:36:54,890 violated any criminal laws of any jurisdiction? 523 00:36:55,390 --> 00:36:56,390 No. 524 00:36:58,060 --> 00:37:00,160 And as a layperson, this is my answer, of course. 525 00:37:01,940 --> 00:37:07,980 Not surprisingly, it turns out that he never had $39 million in cash. 526 00:37:08,740 --> 00:37:11,380 Osorio has been working his magic again. 527 00:37:11,840 --> 00:37:17,060 This was act two of what had already transpired with CHS Electronics. It was 528 00:37:17,060 --> 00:37:22,360 blatant elementary school financial statement fraud, a few false phony 529 00:37:22,360 --> 00:37:23,360 documents. 530 00:37:23,520 --> 00:37:25,280 It was all smoke and mirrors. 531 00:37:25,600 --> 00:37:30,240 And now his investors learn that Innovita never had a hope of being 532 00:37:30,680 --> 00:37:34,880 It was a company that was hemorrhaging money and was being used as a personal 533 00:37:34,880 --> 00:37:36,420 piggy bank by Claudio Osorio. 534 00:37:38,220 --> 00:37:42,320 Carlos Boozer learns that his million -dollar investment may have gone to pay 535 00:37:42,320 --> 00:37:46,500 the mortgage on Osorio's house and his country club fees. 536 00:37:46,980 --> 00:37:49,980 Oh, listen, it's like being punched in the stomach 50 times in a row. 537 00:37:50,590 --> 00:37:52,230 A million dollars is a lot of money. 538 00:37:52,530 --> 00:37:57,190 And if it's going to get stolen from you, it could have been given to 539 00:37:57,370 --> 00:37:58,930 There's a million things you could have done with it. 540 00:37:59,810 --> 00:38:01,150 And the OPEC money? 541 00:38:01,890 --> 00:38:06,290 Nearly two -thirds of the $3 million that was intended for the devastated 542 00:38:06,290 --> 00:38:11,350 in Haiti was sent directly to Innovita investors as supposed profits. 543 00:38:11,930 --> 00:38:15,990 The rest went to support Osorio's own fabulously wealthy lifestyle. 544 00:38:16,780 --> 00:38:22,100 The fact that Claudio Osorio would take money from the U .S. government and 545 00:38:22,100 --> 00:38:28,680 divert that money from helping the Haitian people and save Haitian lives is 546 00:38:28,680 --> 00:38:33,120 of the most despicable, low things that anyone could do. 547 00:38:33,760 --> 00:38:39,200 In the end, it is determined that in just three years, Osorio made off with 548 00:38:39,200 --> 00:38:40,520 than $40 million. 549 00:38:41,380 --> 00:38:44,220 He spent at least $8 million on himself. 550 00:38:45,150 --> 00:38:50,250 And now he, Amaryllis, and their business are in bankruptcy. And the 551 00:38:50,250 --> 00:38:52,350 look for money to pay back his creditors. 552 00:38:52,730 --> 00:38:53,770 The Maserati? 553 00:38:54,110 --> 00:38:55,330 It was leased. 554 00:38:55,930 --> 00:38:56,930 The boat? 555 00:38:57,670 --> 00:38:58,850 Repossessed by the bank. 556 00:39:00,090 --> 00:39:03,590 One item of value they have is Amaryllis' diamond ring. 557 00:39:04,110 --> 00:39:09,210 And she makes a bizarre claim to keep it. We are told that the diamond ring 558 00:39:09,210 --> 00:39:13,430 actually Kubrick's zirconia and was borrowed from a friend of Amaryllis. 559 00:39:13,790 --> 00:39:14,790 in Venezuela. 560 00:39:14,930 --> 00:39:16,470 The story is a lie. 561 00:39:16,690 --> 00:39:17,950 The diamond is real. 562 00:39:18,150 --> 00:39:20,530 The ring brings in $50 ,000. 563 00:39:21,550 --> 00:39:26,970 And as people quickly disassociate themselves from Osorio, more money comes 564 00:39:27,770 --> 00:39:34,450 Jeb Bush returns $270 ,000 of the $460 ,000 he was paid as a consultant to 565 00:39:34,450 --> 00:39:35,450 Innovita. 566 00:39:35,850 --> 00:39:39,450 $50 ,000 is returned from the Democratic National Committee. 567 00:39:40,750 --> 00:39:45,690 The biggest asset is, of course, the Star Island house. It is auctioned off 568 00:39:45,690 --> 00:39:46,970 more than $12 million. 569 00:39:47,610 --> 00:39:52,250 With a nearly $7 million mortgage to pay off, it brings in $5 million. 570 00:39:55,690 --> 00:40:01,770 As 2011 comes to an end, Osorio has lost his business and his precious house. 571 00:40:02,310 --> 00:40:06,910 But he is now living in an oceanfront condominium. And as he says in his 572 00:40:06,910 --> 00:40:09,570 deposition, He sees a bright future. 573 00:40:18,730 --> 00:40:24,770 Doing what? 574 00:40:25,870 --> 00:40:26,870 Consulting. 575 00:40:27,630 --> 00:40:28,630 Consulting for whom? 576 00:40:29,070 --> 00:40:31,070 A company located in China. 577 00:40:36,100 --> 00:40:37,400 That's a good question. 578 00:40:38,480 --> 00:40:43,500 But the delusion of his next venture comes to a fast end in December when 579 00:40:43,500 --> 00:40:45,160 unexpected guests arrive. 580 00:40:45,600 --> 00:40:49,700 We got there bright and early in the morning. At the time he was arrested and 581 00:40:49,700 --> 00:40:54,540 placed in handcuff. He, I would describe it as physically and emotionally broke 582 00:40:54,540 --> 00:40:59,840 down to the point where I actually had to call EMS to the scene to make it 583 00:40:59,840 --> 00:41:01,080 him before we went on. 584 00:41:01,400 --> 00:41:04,860 So Mr. Osorio's world at that point crumbled. 585 00:41:05,390 --> 00:41:07,250 And he has been incarcerated ever since. 586 00:41:08,810 --> 00:41:14,190 His booking photo shows the dazed expression of a man who never saw it 587 00:41:14,690 --> 00:41:16,930 Claudio Osorio was the Teflon Don. 588 00:41:17,310 --> 00:41:21,970 Nothing stuck to him throughout the years. He could always maneuver his way 589 00:41:21,970 --> 00:41:23,050 of any type of situation. 590 00:41:24,270 --> 00:41:29,510 Osorio has been indicted on 23 counts of fraud and money laundering. He pleads 591 00:41:29,510 --> 00:41:30,510 guilty. 592 00:41:30,640 --> 00:41:35,900 It is reported that as a condition of his plea, he asks that Amaryllis receive 593 00:41:35,900 --> 00:41:39,160 immunity from prosecution, and his request is granted. 594 00:41:39,540 --> 00:41:44,200 He is sentenced to 12 1⁄2 years in prison and is ordered to pay more than 595 00:41:44,200 --> 00:41:45,820 million in restitution. 596 00:41:47,000 --> 00:41:48,880 Amaryllis has now divorced him. 597 00:41:51,600 --> 00:41:57,020 When Chris Korge learns that Osorio is headed to federal prison, he realizes 598 00:41:57,020 --> 00:42:02,700 money he spent in legal fees exposing Osorio was one of the best investments 599 00:42:02,700 --> 00:42:03,439 has made. 600 00:42:03,440 --> 00:42:08,520 You don't get many opportunities in your life to do something that may save 601 00:42:08,520 --> 00:42:09,560 someone else's life. 602 00:42:09,860 --> 00:42:15,060 I could see where a fraudster like this could put someone in such a... 603 00:42:15,810 --> 00:42:20,170 horrendous situation, losing everything they worked for for their whole life, 604 00:42:20,250 --> 00:42:22,030 because that's what almost happened to me. 605 00:42:22,490 --> 00:42:25,570 And he could care less about it. 606 00:42:26,090 --> 00:42:31,790 He has no conscience, no heart, no soul. 607 00:42:32,870 --> 00:42:36,810 In the dead of night, he invades your house. That's all the room that he 608 00:42:36,950 --> 00:42:39,090 And robs you silently while you sleep. 609 00:42:39,410 --> 00:42:41,130 Blaine is one of the top burglars ever. 610 00:42:41,810 --> 00:42:43,530 American Greed, next. 611 00:42:44,060 --> 00:42:47,440 On the fastest growing cable network in primetime, CNBC. 612 00:42:47,880 --> 00:42:52,260 The fastest growing cable network in primetime, CNBC.