1 00:00:01,320 --> 00:00:07,100 In this episode of American Greed, Bobby Kahn runs a New Jersey dealership 2 00:00:07,100 --> 00:00:13,200 featuring cars so exotic that you have to ask the price you can't afford it. 3 00:00:13,600 --> 00:00:15,500 A base price of $1 .8 million. 4 00:00:15,740 --> 00:00:17,480 Only three people will have it. 5 00:00:18,300 --> 00:00:23,720 Rolls -Royce Ghost, Lamborghini, Bobby Kahn is going after the high, high -end 6 00:00:23,720 --> 00:00:24,720 consumers. 7 00:00:25,070 --> 00:00:30,470 But the FBI believes Kahn has zoomed off into the sunset after selling cars that 8 00:00:30,470 --> 00:00:31,308 aren't his. 9 00:00:31,310 --> 00:00:35,430 I want my money. I want my car. Where is my car? Everything he did was about 10 00:00:35,430 --> 00:00:41,230 stealing money. And later, in upstate New York, Paul Seglia claims to own half 11 00:00:41,230 --> 00:00:45,810 of Facebook and says he's got the contract to prove it. Now that Facebook 12 00:00:45,810 --> 00:00:48,050 worth billions, he was going to go after some of that money. 13 00:00:48,310 --> 00:00:51,250 Mark Zuckerberg's signature is on the contract. 14 00:00:51,800 --> 00:00:53,160 It just kind of gave you goosebumps. 15 00:00:53,520 --> 00:00:58,740 But when Seglia heads to court to take on Zuckerberg, he ends up in handcuffs, 16 00:00:58,840 --> 00:01:00,240 accused of fraud. 17 00:01:01,180 --> 00:01:07,840 It's a huge situation involving very, very powerful people trying to 18 00:01:07,840 --> 00:01:14,100 put Mr. Seglia in a vice and crush him. Whether he's a little guy speaking truth 19 00:01:14,100 --> 00:01:18,560 to power or just a brazen con man, one thing is clear. 20 00:01:18,880 --> 00:01:20,840 Paul Seglia has disappeared. 21 00:01:21,610 --> 00:01:27,010 Paul comes up with this crazy scheme to show movement to be able to escape. 22 00:01:43,790 --> 00:01:49,410 Since opening in 2013, Emporio Motor Group has been a hot destination. 23 00:01:50,280 --> 00:01:53,900 for ultra -high -end exotic cars in Bergen County, New Jersey. 24 00:01:54,860 --> 00:01:59,560 Emporio owner Bobby Kahn sells pre -owned status symbols on consignment. 25 00:01:59,840 --> 00:02:04,720 In exchange for hosting the cars in his gleaming showroom and enticing buyers, 26 00:02:05,260 --> 00:02:08,479 the car's owners agree to give Kahn a cut of the sale. 27 00:02:08,979 --> 00:02:12,860 The way it should work is that you would get some of the money back for your 28 00:02:12,860 --> 00:02:17,460 car. If you had a loan on it, the loan would be paid off, and then he would 29 00:02:17,460 --> 00:02:19,640 make some money on it, so everyone would win. 30 00:02:20,060 --> 00:02:24,340 Yet within its first year of business in Ramsey, consignors claim their cars 31 00:02:24,340 --> 00:02:28,660 have gone missing. And buyers say when they call to ask for their titles, 32 00:02:28,860 --> 00:02:31,180 instead, they get only the runaround. 33 00:02:31,600 --> 00:02:36,560 By the spring of 2014, clients feel the excuses have worn thin. 34 00:02:36,980 --> 00:02:41,960 And some, like Peter Winston, go to the dealership to demand answers in person. 35 00:02:42,480 --> 00:02:45,920 I started looking around, and I said, I want to know what's going on here. I 36 00:02:45,920 --> 00:02:48,400 want my car. Where's Bobby Conn? I want to speak to Bobby Conn. 37 00:02:48,640 --> 00:02:54,640 Winston had consigned his BMW M6 convertible to Emporium, and now he's 38 00:02:54,640 --> 00:02:55,640 it's missing. 39 00:02:55,780 --> 00:02:58,520 They say, listen, if you don't calm down or get out of here, we're going to call 40 00:02:58,520 --> 00:02:59,219 the police. 41 00:02:59,220 --> 00:03:02,640 So I'm like, go ahead, call the police. And I'm like, come on, hurry up. I want 42 00:03:02,640 --> 00:03:05,820 to speak to Bobby Conn. I want my money. I want my car. Where is my car? 43 00:03:06,840 --> 00:03:11,740 Winston fears arrest, but he says when the cops arrive, he gets a different 44 00:03:11,740 --> 00:03:12,740 shot. 45 00:03:13,240 --> 00:03:16,560 Behind the policemen are an angry mob scene. 46 00:03:17,000 --> 00:03:21,080 And coincidentally, we all had enough, and we all got there on the same day. So 47 00:03:21,080 --> 00:03:24,540 there was over a dozen people there on this day looking to find out what's 48 00:03:24,540 --> 00:03:27,940 on. So at this point, I realize what a disaster it is. 49 00:03:28,820 --> 00:03:33,600 Emporio Motor Group is owned by Afzal Khan, a 32 -year -old dealer better 50 00:03:33,600 --> 00:03:34,600 as Bobby. 51 00:03:35,040 --> 00:03:38,780 Emporio Motor Group, the real adult toy store. If it's not good enough for us, 52 00:03:38,860 --> 00:03:40,680 it's not good enough for you. 53 00:03:42,190 --> 00:03:47,030 Khan is born in Scotland in 1982, the son of immigrants from Pakistan. 54 00:03:47,810 --> 00:03:52,030 He grows up in the United States, graduating from high school in 2001. 55 00:03:53,270 --> 00:03:59,070 Reporter Joan Verdon interviews Khan in 2013, shortly before Emporio's grand 56 00:03:59,070 --> 00:04:04,770 opening. He said that as a young boy, he remembers begging his dad to take him 57 00:04:04,770 --> 00:04:07,930 to car dealerships, that he would sneak in. 58 00:04:08,280 --> 00:04:12,740 car magazines into his house, like the way other guys would be sneaking in 59 00:04:12,740 --> 00:04:13,740 Playboy. 60 00:04:14,020 --> 00:04:19,720 He claimed that he could tell a luxury car by the smell of its leather, that 61 00:04:19,720 --> 00:04:20,779 it's a piece of art. 62 00:04:21,820 --> 00:04:27,820 In 2008, entrepreneur Seth Rose runs a transport company for exotic and high 63 00:04:27,820 --> 00:04:28,820 -end cars. 64 00:04:28,840 --> 00:04:33,000 He meets Bobby Kahn at a Bentley and Lamborghini dealership on Long Island, 65 00:04:33,140 --> 00:04:34,980 where Kahn works as a buyer. 66 00:04:36,010 --> 00:04:40,790 When I first met Bobby, he was a fast talker, but a very likable guy. 67 00:04:41,230 --> 00:04:43,030 He seemed to be a man of means. 68 00:04:43,230 --> 00:04:47,530 He was always chauffeured around in a Bentley. He had an assistant, so he 69 00:04:47,530 --> 00:04:48,530 very refined. 70 00:04:49,190 --> 00:04:55,070 The Long Island dealership goes out of business in 2009, and Bobby Kahn sets up 71 00:04:55,070 --> 00:05:00,710 shop in a modest Jersey City storefront as an independent dealer, calling 72 00:05:00,710 --> 00:05:02,730 himself Emporio Motor Group. 73 00:05:03,890 --> 00:05:07,330 Rose says he provides seed money for Khan's new venture. 74 00:05:07,590 --> 00:05:13,270 I had sold a couple of my own cars through him, and he asked me if he could 75 00:05:13,270 --> 00:05:15,950 on to the money to use to buy and sell cars. 76 00:05:16,610 --> 00:05:20,450 At the time, I agreed, and we were partners on the cars. 77 00:05:21,410 --> 00:05:26,090 He would buy a car, sell it, and give me a commission for part of the profit. 78 00:05:27,170 --> 00:05:30,590 Rose feels that for six to eight months, their arrangement works well. 79 00:05:31,070 --> 00:05:34,290 Every time he'd buy a car, he would send me the details of the car, pictures of 80 00:05:34,290 --> 00:05:38,570 the car, because I have a huge network of exotic car owners that would be 81 00:05:38,570 --> 00:05:39,890 interested in buying such cars. 82 00:05:40,350 --> 00:05:43,490 At one point, he sent me information on a Ferrari that he purchased. 83 00:05:44,030 --> 00:05:45,630 I had plenty of people interested. 84 00:05:45,950 --> 00:05:49,470 Despite the intense demand, Bobby Kahn is reluctant to sell. 85 00:05:49,750 --> 00:05:51,710 Rose says he has a ready excuse. 86 00:05:52,530 --> 00:05:56,010 He kept insisting that there was a problem with the title and that he 87 00:05:56,010 --> 00:05:59,010 sell the car, so I did a little fact -checking myself. 88 00:05:59,520 --> 00:06:02,660 to find that he had sold the car and that it was gone. 89 00:06:03,680 --> 00:06:07,900 Rose thinks he's been ripped off to the tune of $130 ,000. 90 00:06:08,980 --> 00:06:13,660 He says he confronts Kahn about the missing Ferrari and the money, and they 91 00:06:13,660 --> 00:06:14,660 out a payment schedule. 92 00:06:15,120 --> 00:06:20,400 He came to see me at my office in Long Island, and he brought with him $10 ,000 93 00:06:20,400 --> 00:06:24,840 in cash, and from that moment forward, he would send me money every month. 94 00:06:26,000 --> 00:06:30,940 He really made a sincere attempt to apologize to me. I'm not going to say 95 00:06:30,940 --> 00:06:33,820 completely trusted him, but I still stayed friendly with him. 96 00:06:34,780 --> 00:06:39,880 Kahn appears to recover from the alleged misstep, and his company's profile 97 00:06:39,880 --> 00:06:41,780 rises greatly in 2011. 98 00:06:42,600 --> 00:06:47,660 That year, Emporio Motor Group becomes the exclusive U .S. distributor for 99 00:06:47,660 --> 00:06:50,140 Zenvo, a carmaker from Denmark. 100 00:06:50,560 --> 00:06:54,320 Its flagship supercar, the ST1. 101 00:06:54,970 --> 00:06:56,670 is made entirely by hand. 102 00:06:57,330 --> 00:07:00,790 Fifteen units are destined for the world. Out of the 15, three come to the 103 00:07:00,790 --> 00:07:01,469 United States. 104 00:07:01,470 --> 00:07:08,110 The U .S. model is an ST -150S, gives you 1 ,250 horsepower, seven -speed F -1 105 00:07:08,110 --> 00:07:10,370 transmission, and a base price of $1 .8 million. 106 00:07:11,290 --> 00:07:13,410 It's a major coup for Bobby Kahn. 107 00:07:14,070 --> 00:07:20,590 In November 2011, Kahn premieres the Zenbo ST -1 at a posh New Jersey 108 00:07:20,590 --> 00:07:22,670 set against the New York skyline. 109 00:07:23,920 --> 00:07:26,860 There, Melissa Gorga gets behind the wheel. 110 00:07:27,340 --> 00:07:32,340 Gorga is a star of the reality TV series The Real Housewives of New Jersey. 111 00:07:33,240 --> 00:07:37,920 Sort of like starring in his own reality show. If you look rich, you are rich. 112 00:07:38,320 --> 00:07:41,000 If you say it, it's true. 113 00:07:42,360 --> 00:07:46,000 Trying to live what he thought was the Jersey lifestyle. 114 00:07:48,980 --> 00:07:50,520 Next on American Greed. 115 00:07:51,280 --> 00:07:56,980 Bobby Kahn mingles with stars, and his customers search for their missing car. 116 00:07:57,420 --> 00:08:00,820 What are you going to do about this? This is my car. It's stolen. 117 00:08:01,040 --> 00:08:04,160 It's my vehicle. It's my property. I have the title. 118 00:08:13,640 --> 00:08:19,500 In April 2013, Bobby Kahn moves Emporio Motor Group to Ramsey, New Jersey. 119 00:08:20,030 --> 00:08:23,870 He throws a grand opening to celebrate his sparkling new showroom. 120 00:08:24,230 --> 00:08:28,050 He had a lot of people there. There was a ton of food. There were spotlights. 121 00:08:28,090 --> 00:08:29,090 There were celebrities. 122 00:08:29,270 --> 00:08:30,270 It was a big show. 123 00:08:30,630 --> 00:08:35,669 VIP guests include professional athletes and musicians, as well as Jacqueline 124 00:08:35,669 --> 00:08:40,630 Loretta and Melissa Gorga, who are cast members on the Bravo series The Real 125 00:08:40,630 --> 00:08:42,010 Housewives of New Jersey. 126 00:08:42,630 --> 00:08:47,790 Jenny J. Wow Farley from MTV's The Jersey Shore also makes an appearance. 127 00:08:49,340 --> 00:08:54,660 Although the Emporio Motor Group showroom boasts copious eye candy, few 128 00:08:54,660 --> 00:08:56,920 cars actually belong to Bobby Kahn. 129 00:08:57,940 --> 00:09:02,940 The dealership's inventory is comprised of cars on consignment from private 130 00:09:02,940 --> 00:09:06,700 owners. A lot of them said they had been trying to sell their car on Craigslist, 131 00:09:06,740 --> 00:09:11,040 and he reached out to them and sort of charmed them and said, why are you 132 00:09:11,040 --> 00:09:13,800 selling your car on Craigslist? Come bring it to my beautiful showroom. 133 00:09:15,040 --> 00:09:16,080 Emporio Motor Group. 134 00:09:16,819 --> 00:09:18,700 Quality service you can trust. 135 00:09:20,300 --> 00:09:24,060 Brendan Kehoe works in New Jersey as a software executive. 136 00:09:24,500 --> 00:09:29,080 He first visits Emporia Motor Group with his business partner, who buys a 137 00:09:29,080 --> 00:09:30,240 Bentley from Bobby Kahn. 138 00:09:30,900 --> 00:09:37,040 In the showroom, Kehoe spies his own dream car, a Porsche 911 Carrera S. 139 00:09:37,460 --> 00:09:39,240 I've always wanted a Porsche 911. 140 00:09:39,920 --> 00:09:43,940 I have a little gray model that's been sitting in my office for about 10 years. 141 00:09:44,510 --> 00:09:49,250 And being a family man, I had never really owned, you know, a mad money type 142 00:09:49,250 --> 00:09:50,250 car. 143 00:09:50,650 --> 00:09:54,750 Several visits later, Kehoe finally succumbs to the siren song. 144 00:09:55,070 --> 00:09:59,410 I had made a decision to say I'm going to buy the car that I had always wanted. 145 00:09:59,710 --> 00:10:05,170 So I plunked the money down and drove around town in it for about an hour and 146 00:10:05,170 --> 00:10:07,110 half, just for the experience of it. 147 00:10:07,350 --> 00:10:11,330 Kehoe drives his dream car home with temporary plates and registration. 148 00:10:12,200 --> 00:10:17,540 But he becomes concerned when 10 days pass and his title and registration 149 00:10:17,540 --> 00:10:23,100 have not arrived. I went back to Emporio Motors and was just told that, oh, it's 150 00:10:23,100 --> 00:10:28,720 on its way. When nothing arrives after a few more days, Kehoe says he returns to 151 00:10:28,720 --> 00:10:34,500 the dealership. I've got another song and dance act just short of my dog ate 152 00:10:34,500 --> 00:10:36,820 homework. I realized something was wrong. 153 00:10:37,120 --> 00:10:41,500 On a hunch, Kehoe convinces his business partner, who bought a Bentley from 154 00:10:41,500 --> 00:10:46,400 Bobby Kahn, to check the car's registration with the New Jersey Motor 155 00:10:46,400 --> 00:10:51,000 Commission. They informed us that his registration in place had actually been 156 00:10:51,000 --> 00:10:53,340 canceled the day after he acquired the car. 157 00:10:53,640 --> 00:10:59,080 And immediately I then knew that something was up. I went back to 158 00:10:59,500 --> 00:11:02,360 Bobby Kahn locked himself upstairs in his office. 159 00:11:02,860 --> 00:11:03,860 would not come out. 160 00:11:04,180 --> 00:11:09,840 Kehoe begins posting on luxury car forums and review websites, warning 161 00:11:09,840 --> 00:11:12,540 about his title troubles at Emporio Motor Group. 162 00:11:12,820 --> 00:11:18,320 I also went to Yelp and started putting up posts under my own name with my cell 163 00:11:18,320 --> 00:11:23,400 number. I started getting phone calls, 50 or so people explaining to me their 164 00:11:23,400 --> 00:11:29,200 story. Florida businessman Peter Winston says in January 2014, he talks with 165 00:11:29,200 --> 00:11:30,200 Bobby Kahn. 166 00:11:30,240 --> 00:11:33,680 about consigning his BMW M6 convertible. 167 00:11:34,080 --> 00:11:38,780 I didn't really have a need to have such a fancy car anymore, and a family 168 00:11:38,780 --> 00:11:42,520 member in need needed some money anyway, so I thought I would sell the car and 169 00:11:42,520 --> 00:11:43,520 help them out. 170 00:11:43,860 --> 00:11:45,780 Winston owns his car outright. 171 00:11:46,360 --> 00:11:50,500 Being able to consign without handing over the car's physical title up front 172 00:11:50,500 --> 00:11:51,820 makes him feel safe. 173 00:11:52,480 --> 00:11:56,820 If two people were stopped, and one person is at a bus stop with a title to 174 00:11:56,820 --> 00:12:01,130 vehicle, and another person is in the vehicle, And a policeman says, whose 175 00:12:01,130 --> 00:12:02,190 vehicle this is? 176 00:12:03,090 --> 00:12:06,850 And I say, it's mine, and I show the title. I believe the policeman will say, 177 00:12:06,990 --> 00:12:09,930 sir, you'll have to get out of that vehicle and give it to him. 178 00:12:10,250 --> 00:12:15,390 While Winston is at home in Florida with his title, he says Bobby Kahn has big 179 00:12:15,390 --> 00:12:17,550 plans for his car in New Jersey. 180 00:12:18,010 --> 00:12:22,150 He even sends me a picture of the car in the showroom, and it's all polished up 181 00:12:22,150 --> 00:12:23,570 like when it was brand new. 182 00:12:24,350 --> 00:12:27,510 And he says, don't worry, it's going to be out of here in one, two, three. 183 00:12:28,630 --> 00:12:31,330 One, two, three, not so much. 184 00:12:32,070 --> 00:12:33,510 He said, oh, I have a buyer. 185 00:12:34,010 --> 00:12:36,510 Oh, it fell through. I have another buyer. It fell through. 186 00:12:36,950 --> 00:12:42,610 Then finally said he had another buyer, and the thing is going through, and I'm 187 00:12:42,610 --> 00:12:43,610 going to send you some money. 188 00:12:44,010 --> 00:12:47,270 Finally, I got a Federal Express envelope, and it was empty. 189 00:12:48,070 --> 00:12:49,790 So I said, what's going on here? 190 00:12:50,030 --> 00:12:56,130 In spring 2014, Winston recalls traveling to New Jersey to confront 191 00:12:56,130 --> 00:12:57,130 in the showroom. 192 00:12:57,240 --> 00:13:00,200 I said, I want to know what's going on here. I want my car. Where's Bobby Kahn? 193 00:13:00,220 --> 00:13:03,580 I want to speak to Bobby Kahn. There was over a dozen people there on this day 194 00:13:03,580 --> 00:13:05,260 looking to find out what's going on. 195 00:13:05,760 --> 00:13:10,240 At this point, I realized what a disaster it is and that, you know, I 196 00:13:10,240 --> 00:13:11,780 serious loss on my hands with this car. 197 00:13:12,360 --> 00:13:18,120 Winston eventually gets a call from a man in Illinois who says he has the M6. 198 00:13:18,480 --> 00:13:23,680 The buyer has his own story of being duped by Bobby Kahn. At first, he says 199 00:13:23,680 --> 00:13:25,200 in love with his new Beamer. 200 00:13:25,690 --> 00:13:30,010 He's driving the car back to Illinois, probably with the top down, putting on 201 00:13:30,010 --> 00:13:34,490 the music, maybe even putting it into the excess of the speed limit. 202 00:13:34,490 --> 00:13:35,490 is magical. 203 00:13:35,770 --> 00:13:38,850 But Peter Winston still has the title to the car. 204 00:13:40,010 --> 00:13:44,150 Bobby Kahn has managed to sell it to the new buyer without the proper 205 00:13:44,150 --> 00:13:45,150 documentation. 206 00:13:45,630 --> 00:13:50,270 And without title, the new owner can't register the car in Illinois. 207 00:13:51,110 --> 00:13:55,190 Making matters worse, the new buyer got a loan to buy it. 208 00:13:55,550 --> 00:13:59,110 And his lender expects him to make the payments no matter what. 209 00:13:59,850 --> 00:14:04,230 Now it's sitting there and he can't use it. So it was kind of annoying to him. 210 00:14:04,290 --> 00:14:07,690 So I caught him at the annoying phase. He was just disgusted. 211 00:14:08,030 --> 00:14:09,190 The thrill was gone. 212 00:14:09,530 --> 00:14:14,390 Winston says he reaches out to the buyer's lender, TD Auto Finance. 213 00:14:14,930 --> 00:14:16,730 I contacted a VP at the bank. 214 00:14:17,050 --> 00:14:20,790 I said, this is my car. I have the title. You need a title. 215 00:14:20,990 --> 00:14:23,170 He needs the title to register the car. 216 00:14:23,410 --> 00:14:27,310 He's sitting paying on a car that's unregistered. What are you going to do 217 00:14:27,310 --> 00:14:29,170 this? This is my car. It's stolen. 218 00:14:29,390 --> 00:14:32,530 It's my vehicle. It's my property. I have the title. 219 00:14:33,610 --> 00:14:37,230 He said he had to protect his buyer, and there's a transaction between him and 220 00:14:37,230 --> 00:14:42,310 the buyer, and they're working on straightening the situation out, and 221 00:14:42,310 --> 00:14:43,410 nothing they can do for me. 222 00:14:43,790 --> 00:14:48,770 In a statement to American Greed, TD Auto Finance says the company employs 223 00:14:48,770 --> 00:14:53,990 robust controls and procedures to detect potential fraud and promptly alert the 224 00:14:53,990 --> 00:14:55,510 appropriate law enforcement authorities. 225 00:14:56,470 --> 00:15:00,690 In the case of Emporio Motor Group, those controls and procedures worked as 226 00:15:00,690 --> 00:15:03,210 designed, and we cooperated fully with authorities. 227 00:15:05,130 --> 00:15:09,650 Winston learns that New Jersey law favors the buyer, not the consigner, 228 00:15:09,790 --> 00:15:12,610 regardless of who actually holds the title. 229 00:15:13,230 --> 00:15:17,490 The law is clear in New Jersey that if a retail consumer goes to a dealer and 230 00:15:17,490 --> 00:15:21,310 buys a car, they are not obligated to research the title history for the 231 00:15:21,310 --> 00:15:26,230 vehicle. The law allows them to assume that the dealer is able to sell and 232 00:15:26,230 --> 00:15:28,030 convey good title to that vehicle. 233 00:15:28,590 --> 00:15:35,130 Winston had hoped to get $65 ,000 out of his M6, but all it gets is stolen right 234 00:15:35,130 --> 00:15:37,850 out from under him, allegedly by Bobby Kahn. 235 00:15:38,300 --> 00:15:41,920 and eliminate me completely as if I don't exist now, and I'm completely 236 00:15:41,920 --> 00:15:46,120 off the title, and now the car is titled by the new buyer in the state of 237 00:15:46,120 --> 00:15:47,120 Illinois. 238 00:15:48,500 --> 00:15:54,380 Next on American Greed, as Emporio Motor Group goes bust, Bobby Kahn goes 239 00:15:54,380 --> 00:15:59,020 missing. A lot of dealers might perpetrate fraud when they know their 240 00:15:59,020 --> 00:16:00,100 is circling the drain. 241 00:16:00,340 --> 00:16:03,760 In this case, it looks like it was his business plan from the get -go. 242 00:16:15,560 --> 00:16:19,920 By summer 2014, Emporio Motor Group clients are furious. 243 00:16:21,400 --> 00:16:25,620 Car buyers say they can't drive their vehicles because Emporio won't send them 244 00:16:25,620 --> 00:16:26,620 their titles. 245 00:16:28,240 --> 00:16:33,000 That's because those titles are often still in the hands of consignors who say 246 00:16:33,000 --> 00:16:36,280 Bobby Kahn has sold their cars right out from under them. 247 00:16:36,540 --> 00:16:40,540 A lot of dealers might perpetrate fraud when they know their business is 248 00:16:40,540 --> 00:16:42,580 circling the drain and going out of business. 249 00:16:43,230 --> 00:16:46,490 In this case, it looks like it was his business plan from the get -go. 250 00:16:46,890 --> 00:16:53,750 From December 2013 through September 2014, at least 75 Emporio 251 00:16:53,750 --> 00:16:58,490 clients filed complaints with the Ramsey Police and Bergen County Prosecutors. 252 00:16:58,650 --> 00:17:04,069 The local authorities just took their sweet time in really doing anything 253 00:17:04,069 --> 00:17:08,410 this. And I kept getting back that they were putting the case together. 254 00:17:09,200 --> 00:17:12,940 And that went on for probably better than three months. 255 00:17:14,000 --> 00:17:20,560 We've since learned of as many as perhaps a dozen other people that went 256 00:17:20,560 --> 00:17:26,160 Ramsey police over the span of nine months and were essentially told, you 257 00:17:26,160 --> 00:17:28,480 civil dispute, we're not going to get involved. 258 00:17:29,940 --> 00:17:35,140 The Ramsey police declined an interview request from American Greed, referring 259 00:17:35,140 --> 00:17:37,160 questions about the case to the FBI. 260 00:17:37,900 --> 00:17:41,360 The Bergen County Prosecutor's Office did not return our call. 261 00:17:41,780 --> 00:17:46,300 Many Emporio Motor Group customers who feel their pleas for help aren't being 262 00:17:46,300 --> 00:17:50,980 taken seriously go online to look for answers and warn others. 263 00:17:51,320 --> 00:17:53,920 The word got out that there was this sort of Yelp community. 264 00:17:54,300 --> 00:17:56,740 Right away I was able to get in touch with people. 265 00:17:56,940 --> 00:18:00,080 I found there was this tremendous sort of network of victims. 266 00:18:00,640 --> 00:18:05,320 Joan Verdon interviewed several Emporio clients who had posted on Yelp .com. 267 00:18:05,850 --> 00:18:09,590 We immediately did a story saying there have been all these complaints about 268 00:18:09,590 --> 00:18:14,510 Emporio Motor Group, Bobby Kahn, and they all seem to be saying the same 269 00:18:14,550 --> 00:18:18,510 that people either bought cars, didn't get titles, or that they sold their cars 270 00:18:18,510 --> 00:18:20,250 to Bobby Kahn and never received money. 271 00:18:21,310 --> 00:18:27,590 In mid -September 2014, the New Jersey Motor Vehicle Commission suspends 272 00:18:27,590 --> 00:18:28,610 Motor Group's license. 273 00:18:29,450 --> 00:18:32,870 And then in October, the U .S. Attorney of New Jersey... 274 00:18:33,230 --> 00:18:36,150 charges Abzal Bobby Kahn with wire fraud. 275 00:18:36,750 --> 00:18:43,450 The indictment alleges one lender has lost $1 .7 million over the course of 276 00:18:43,450 --> 00:18:45,990 21 auto loans to Emporio clients. 277 00:18:47,070 --> 00:18:51,850 All banks have built -in safeguards to prevent these types of actions. 278 00:18:52,150 --> 00:18:57,030 If it happens once, something really fell through the cracks. When it happens 279 00:18:57,030 --> 00:18:59,770 -something times, it's not an accident, it's not a coincidence. 280 00:19:00,460 --> 00:19:03,580 Total losses could stand as high as $7 million. 281 00:19:04,620 --> 00:19:09,800 You would have the seller out money, the finance company out money, and the 282 00:19:09,800 --> 00:19:13,580 buyer out money. There's not many people who were able to scam as well as he 283 00:19:13,580 --> 00:19:14,439 did. 284 00:19:14,440 --> 00:19:18,240 The FBI goes to arrest Bobby Kahn in late October. 285 00:19:18,540 --> 00:19:20,540 By then, he's gone. 286 00:19:21,120 --> 00:19:24,980 We have looked for him from that date, and we continue to look for him now. 287 00:19:25,180 --> 00:19:28,060 I think the walls were closing in on him way too fast. 288 00:19:28,620 --> 00:19:32,020 and that he couldn't handle it, and that's why he just left. 289 00:19:32,420 --> 00:19:38,140 In Bobby Kahn's wake, some Emporio clients, like Peter Winston, feel they 290 00:19:38,140 --> 00:19:40,280 no car and no recourse. 291 00:19:40,540 --> 00:19:46,700 I'm contacting TD Auto Finance and asking them to solve this problem by 292 00:19:46,700 --> 00:19:47,700 me restitution. 293 00:19:47,840 --> 00:19:51,420 They keep telling me I should go back to the dealership, knowing that the 294 00:19:51,420 --> 00:19:55,240 dealership is closed down and the owner of the dealership is a fugitive from the 295 00:19:55,240 --> 00:19:59,700 law. Other buyers and sellers have reached private agreements for the cars 296 00:19:59,700 --> 00:20:04,060 question. Brendan Kehoe now has the title to his dream Porsche. 297 00:20:04,420 --> 00:20:10,580 I had paid $40 ,000 plus for the car. The gentleman who owned the car, when we 298 00:20:10,580 --> 00:20:15,160 got in contact, I explained to him what the law was and that, you know, both of 299 00:20:15,160 --> 00:20:20,000 us were going to lose. I'd have a depreciating boat anchor in my garage, 300 00:20:20,000 --> 00:20:21,000 wouldn't have anything. 301 00:20:21,770 --> 00:20:26,550 We reached a deal that I gave him additional $8 ,000 of cash out of my 302 00:20:26,690 --> 00:20:31,710 and he brought me the legal title, and I managed to register it the next day. 303 00:20:32,230 --> 00:20:37,930 But he hoped, for the sake of all Emporio clients, Abzal Bobby Kahn will 304 00:20:37,930 --> 00:20:43,090 justice. Just remember, revenge is a dish best served cold, and everybody 305 00:20:43,090 --> 00:20:45,870 crosses a dark street by themselves sooner or later. 306 00:20:46,390 --> 00:20:48,030 That's what I will say to you, Bobby. 307 00:20:48,410 --> 00:20:50,630 Sooner or later, I will find you. 308 00:20:51,710 --> 00:20:57,750 Abzav Babi Khan is a U .S. citizen, but has ties to Pakistan, Dubai, Scotland, 309 00:20:57,850 --> 00:20:58,569 and Canada. 310 00:20:58,570 --> 00:21:03,910 The FBI is offering a $20 ,000 reward for information leading to his capture. 311 00:21:05,190 --> 00:21:11,210 Next on American Greed, an entrepreneur sues Mark Zuckerberg and finds himself 312 00:21:11,210 --> 00:21:12,450 in handcuffs. 313 00:21:12,770 --> 00:21:17,790 Paul Teglia seems interested in one thing, which is making money by suing 314 00:21:17,790 --> 00:21:18,790 Facebook. 315 00:21:29,680 --> 00:21:35,320 3 ,000 miles from Silicon Valley in the hills of western New York, a man named 316 00:21:35,320 --> 00:21:38,840 Paul Seglia fancies himself a high -tech visionary. 317 00:21:39,440 --> 00:21:44,700 He claims to be the rightful owner of half of Facebook, thanks to a gamble he 318 00:21:44,700 --> 00:21:49,560 took back in 2003 on its young, unknown founder, Mark Zuckerberg. 319 00:21:50,240 --> 00:21:53,680 Now the company is worth hundreds of billions of dollars. 320 00:21:54,020 --> 00:21:57,260 There are more active Facebook users than people in China. 321 00:21:58,480 --> 00:22:03,360 But to become a billionaire himself, Paul Seglia will have to do battle with 322 00:22:03,360 --> 00:22:04,540 Mark Zuckerberg. 323 00:22:06,480 --> 00:22:11,220 Seglia grows up in Wellsville, a town of about 5 ,000 people. 324 00:22:11,560 --> 00:22:17,260 This is the Wellsville High School class of 91 senior yearbook. 325 00:22:17,480 --> 00:22:21,280 Every yearbook has a senior poll, most respected, most likely to become 326 00:22:21,280 --> 00:22:24,760 president. And Paul Seglia was named most corrupt. 327 00:22:25,930 --> 00:22:30,910 A lot of his high school friends were saying he always had some kind of a 328 00:22:30,910 --> 00:22:36,970 going or some kind of a make -money -quick business idea, and that was kind 329 00:22:36,970 --> 00:22:38,970 his M .O. 330 00:22:39,270 --> 00:22:45,330 Paul Seglia goes from corrupt kid to full -on felon at 24 when he pleads 331 00:22:45,330 --> 00:22:49,330 to possessing psilocybin, also known as magic mushrooms. 332 00:22:49,890 --> 00:22:54,550 Seglia spends the next 10 years on probation, but he can't seem to stay out 333 00:22:54,550 --> 00:22:55,550 trouble. 334 00:22:56,330 --> 00:23:02,030 In 2005 in Florida, he pleads no contest to trespassing. 335 00:23:03,230 --> 00:23:08,170 A sheriff claims he was giving potential buyers a tour of property in an orange 336 00:23:08,170 --> 00:23:11,170 grove, land he didn't own. 337 00:23:13,570 --> 00:23:18,490 Seglia eventually makes his way back to Wellsville, where he marries a hometown 338 00:23:18,490 --> 00:23:20,130 girl and starts a family. 339 00:23:20,430 --> 00:23:24,610 In between big ideas, he gets by as a landlord. 340 00:23:25,150 --> 00:23:29,790 One of his houses was a couple houses down from where I lived, and he did the 341 00:23:29,790 --> 00:23:32,910 bare minimum to get that house livable. 342 00:23:34,190 --> 00:23:40,050 His ability to do some work, you know, kind of kept him going while he was 343 00:23:40,050 --> 00:23:43,330 trying different businesses to make the big dollar. 344 00:23:43,810 --> 00:23:48,990 His quest for a payday continues in 2009 when Segalia launches Allegheny 345 00:23:48,990 --> 00:23:53,310 Pellets. The company intends to make and sell wood pellets. 346 00:23:53,660 --> 00:23:56,100 a common home heating fuel in upstate New York. 347 00:23:56,360 --> 00:24:02,420 He accepts roughly $200 ,000 in prepaid orders, largely from Internet customers. 348 00:24:02,900 --> 00:24:08,160 This is where you put the pellets in. The wood pellets themselves, it's just 349 00:24:08,160 --> 00:24:12,140 compressed sawdust and wood chips, and it's really quite small. 350 00:24:12,860 --> 00:24:18,500 Rhiannon Sisson of Sisson's Chainsaws and Stoves in nearby Bolivar learns from 351 00:24:18,500 --> 00:24:21,780 her customers that there's a new player on the pellet scene. 352 00:24:22,140 --> 00:24:25,220 We started getting into that time of year and, you know, it's getting more 353 00:24:25,220 --> 00:24:27,760 difficult to get the wood pellet fuel itself. 354 00:24:28,340 --> 00:24:33,420 And then we hear about this, you know, gentleman who is pre -selling for these 355 00:24:33,420 --> 00:24:37,320 pellets. We're thinking, how does he have these pellets? We were kind of 356 00:24:37,320 --> 00:24:40,380 questioning it, but we thought, you know, maybe he knows something that we 357 00:24:40,380 --> 00:24:44,560 know. But in September of that year, Seglia has bad news. 358 00:24:45,160 --> 00:24:49,920 He tells his customers their pellets won't arrive on time, but he doesn't 359 00:24:49,920 --> 00:24:55,910 refunds. Paul sent out a letter saying that he had layoff, so they were behind 360 00:24:55,910 --> 00:25:01,030 on orders. But, you know, when I visited him and saw the operation, it was Paul. 361 00:25:01,270 --> 00:25:04,050 I'm not sure who his employees were. 362 00:25:05,670 --> 00:25:11,570 In December 2009, the New York Attorney General shuts down Allegheny Pellets and 363 00:25:11,570 --> 00:25:13,450 accuses Seglia of fraud. 364 00:25:14,770 --> 00:25:19,570 Although the case is later settled, the way Paul Seglia tells it... 365 00:25:19,900 --> 00:25:22,560 This legal woe leads to his good fortune. 366 00:25:23,340 --> 00:25:27,180 During his legal proceedings with the Attorney General, he was going through 367 00:25:27,180 --> 00:25:28,800 some paperwork and some old folders. 368 00:25:29,680 --> 00:25:33,480 He told me he was looking for anyone who had owed him money over the years, and 369 00:25:33,480 --> 00:25:36,820 that's when he found his contract with Mark Zuckerberg. 370 00:25:37,500 --> 00:25:42,480 Back in 2003, Zuckerberg is a Harvard freshman majoring in psychology. 371 00:25:43,620 --> 00:25:47,820 Seglia is 29, and working on his latest big idea, 372 00:25:48,590 --> 00:25:49,590 Street Facts. 373 00:25:49,950 --> 00:25:55,270 The company plans to photograph, measure, and map intersections, and then 374 00:25:55,270 --> 00:25:58,970 access to its database to insurance companies investigating accidents. 375 00:25:59,890 --> 00:26:05,090 Seglia posts an ad on Craigslist looking for a coder, and Zuckerberg responds. 376 00:26:07,250 --> 00:26:13,170 In April 2003, Seglia meets the 18 -year -old freshman in Boston, and the two 377 00:26:13,170 --> 00:26:16,690 sign a contract for Zuckerberg to work on Street Facts. 378 00:26:17,210 --> 00:26:18,550 That much they agree on. 379 00:26:18,990 --> 00:26:24,490 But Paul Seglia's attorney, Joseph Alioto, says in addition to the coding 380 00:26:24,490 --> 00:26:28,990 for Street Facts, Zuckerberg pitches Seglia on his own little idea. 381 00:26:29,290 --> 00:26:31,210 He calls it the Facebook. 382 00:26:31,690 --> 00:26:34,970 I just figured it would be really cool if there was some website where I could 383 00:26:34,970 --> 00:26:37,010 go to that would tell me... 384 00:26:37,360 --> 00:26:39,720 a bunch of information about my friends and the people around me. 385 00:26:39,940 --> 00:26:45,920 Alioto says Seglia invests $1 ,000 in Zuckerberg's pet project, a good one, 386 00:26:45,920 --> 00:26:47,900 perhaps with limited potential. 387 00:26:48,380 --> 00:26:53,440 Mr. Seglia thought that this was something confined to the college and 388 00:26:53,440 --> 00:26:57,940 selling, basically, or attempting to sell things like mugs and sweatshirts 389 00:26:57,940 --> 00:26:58,940 things like that. 390 00:26:59,260 --> 00:27:05,740 And so he made that particular agreement, but without knowledge of what 391 00:27:05,740 --> 00:27:06,740 turn out to be. 392 00:27:06,970 --> 00:27:12,370 So after allegedly stumbling upon the old contract, Paul Seglia filed suit. 393 00:27:12,710 --> 00:27:16,470 Seglia remembered this kid who he had done work with when he was a college 394 00:27:16,470 --> 00:27:20,110 freshman and decided now that Facebook was worth billions, he was going to go 395 00:27:20,110 --> 00:27:21,110 after some of that money. 396 00:27:22,230 --> 00:27:27,390 CNBC senior correspondent Julia Boorstin notes that Seglia isn't the first 397 00:27:27,390 --> 00:27:29,030 person to stake a claim to Facebook. 398 00:27:29,690 --> 00:27:32,910 In 2009, Zuckerberg settled with Eduardo Saverin. 399 00:27:33,150 --> 00:27:37,890 Saverin was a fellow student of Zuckerberg's at Harvard. He also was a 400 00:27:37,890 --> 00:27:38,890 -founder of Facebook. 401 00:27:39,030 --> 00:27:44,010 The issue there was that Saverin said that Zuckerberg had unfairly diluted his 402 00:27:44,010 --> 00:27:45,010 stake in the company. 403 00:27:45,650 --> 00:27:49,470 The Winklevoss twins' suit against Mark Zuckerberg became very famous in a 404 00:27:49,470 --> 00:27:51,330 Hollywood movie called The Social Network. 405 00:27:51,610 --> 00:27:55,810 We were shocked to see our idea being presented as thefacebook .com. 406 00:27:56,220 --> 00:28:00,600 That suit was settled by Zuckerberg giving the Winklevoss twins $20 million 407 00:28:00,600 --> 00:28:03,720 cash and 1 .25 million Facebook shares. 408 00:28:04,040 --> 00:28:08,000 But Borsten says Seglia's claim is very different. 409 00:28:08,300 --> 00:28:12,480 It was seven years after he said he and Mark Zuckerberg had done business 410 00:28:12,480 --> 00:28:16,180 together. By then, Facebook was worth $23 billion. 411 00:28:16,780 --> 00:28:21,720 To prove his claim, Seglia submits to the court a photocopy of a two -page 412 00:28:21,720 --> 00:28:22,720 contract. 413 00:28:23,210 --> 00:28:28,950 He says it's all spelled out in black and white. He rightfully owns 50 % of 414 00:28:28,950 --> 00:28:29,950 Facebook. 415 00:28:30,790 --> 00:28:32,430 Next on American Greed. 416 00:28:32,730 --> 00:28:36,210 Mark Zuckerberg's signature is on the contract. 417 00:28:37,210 --> 00:28:39,050 It just kind of gave you goosebumps. 418 00:28:39,630 --> 00:28:41,950 Want inside information from the show? 419 00:28:42,350 --> 00:28:44,330 Join the Greed social network. 420 00:28:44,650 --> 00:28:47,270 Like us on American Greed's Facebook page. 421 00:28:48,210 --> 00:28:49,410 We'll be right back. 422 00:28:57,390 --> 00:29:02,990 In July 2010, at a court hearing in Buffalo, ownership of Facebook is on the 423 00:29:02,990 --> 00:29:06,290 line. The company is worth $23 billion. 424 00:29:07,910 --> 00:29:12,630 Entrepreneur Paul Seglia claims he owns half of the social media company, and he 425 00:29:12,630 --> 00:29:16,730 produces this work -for -hire contract to try to prove it. 426 00:29:17,030 --> 00:29:19,250 A Facebook attorney tells the judge, 427 00:29:20,070 --> 00:29:22,850 Our client entered a contract with Seglia. 428 00:29:23,070 --> 00:29:26,990 Whether he signed this piece of paper, we are unsure at this point. 429 00:29:27,240 --> 00:29:32,180 Days later, in an interview with Diane Sawyer, Mark Zuckerberg is asked about 430 00:29:32,180 --> 00:29:34,500 his lawyer's unsure statement. 431 00:29:35,080 --> 00:29:39,020 If we said that we were unsure, I think that was likely taken out of context 432 00:29:39,020 --> 00:29:42,820 because I think we were quite sure that we did not sign a contract that says 433 00:29:42,820 --> 00:29:45,400 that they have any right to ownership over Facebook. 434 00:29:46,480 --> 00:29:51,320 The very next day, Paul Seglia fires back at Zuckerberg on, of all places, 435 00:29:51,480 --> 00:29:52,480 Facebook. 436 00:29:52,960 --> 00:29:54,000 He writes... 437 00:29:54,430 --> 00:30:00,010 Saw Mark on Diane Sawyer last night. He says, we are quite sure we didn't sign. 438 00:30:00,210 --> 00:30:04,010 It seemed pretty hard for him to get that out without choking up. 439 00:30:06,830 --> 00:30:10,790 Two days after the interview, Facebook issues this written statement. 440 00:30:12,590 --> 00:30:17,430 Mark has made it clear that Sekulia's claims are absurd, and we strongly 441 00:30:17,430 --> 00:30:19,390 the contract is forged. 442 00:30:21,390 --> 00:30:26,010 By April 2011, Facebook's value has swelled to $65 billion. 443 00:30:27,190 --> 00:30:29,690 Paul Seglia ups the ante. 444 00:30:29,970 --> 00:30:34,490 To bolster his assertion that his investment is real, he submits to the 445 00:30:34,490 --> 00:30:37,050 what looks like email excerpts. 446 00:30:37,330 --> 00:30:41,890 They claim to be back and forth with him and Zuckerberg. In one of the messages 447 00:30:41,890 --> 00:30:48,310 dated July 2003, Mark Zuckerberg purportedly asked Seglia for permission 448 00:30:48,310 --> 00:30:50,470 the coding work he's done for Street Facts. 449 00:30:50,940 --> 00:30:51,940 On Facebook. 450 00:30:52,240 --> 00:30:57,380 It reads, I've been tweaking the search engine today and I'm pleased with its 451 00:30:57,380 --> 00:31:01,840 results. I'd like to use it for the Harvard site. I think it will really 452 00:31:01,840 --> 00:31:02,940 people find each other. 453 00:31:03,220 --> 00:31:07,960 Even if they spell names incorrectly, would it be agreeable with you if I 454 00:31:07,960 --> 00:31:09,020 the source code? 455 00:31:09,500 --> 00:31:10,500 Thanks. 456 00:31:11,500 --> 00:31:13,900 In another one, dated January 2004, 457 00:31:14,680 --> 00:31:19,460 Seglia appears to berate Zuckerberg for supposedly missing Facebook's launch 458 00:31:19,460 --> 00:31:20,460 deadline. 459 00:31:21,640 --> 00:31:26,120 He writes, I'm starting to think you just blew that money mark. You know 460 00:31:26,120 --> 00:31:29,860 perfectly well that you can't just take a person's investment and then spend it 461 00:31:29,860 --> 00:31:33,500 on women and beer or whatever you do up there in Harvard. 462 00:31:34,080 --> 00:31:38,240 Everyone was really interested to see these emails, but there was no evidence 463 00:31:38,240 --> 00:31:39,460 that they were actually real. 464 00:31:40,100 --> 00:31:45,900 In June 2011, an attorney for Facebook in Zuckerberg asked the court for 465 00:31:45,900 --> 00:31:49,620 permission to run scientific tests on the paper contract. 466 00:31:50,360 --> 00:31:53,060 and to search through Seglia's electronic media. 467 00:31:53,560 --> 00:31:59,400 There is no question on this earth that he never signed a contract with Paul 468 00:31:59,400 --> 00:32:02,500 Seglia that had anything to do with Facebook, period. 469 00:32:02,840 --> 00:32:09,060 If, however, when he manufactured, doctored, cut and pasted a bogus 470 00:32:09,060 --> 00:32:14,280 document to make it appear as if this was a Facebook contract, but then 471 00:32:14,280 --> 00:32:19,350 concocted... Bogus emails, which he did, those are emails that were caged over 472 00:32:19,350 --> 00:32:21,030 because he's committing a fraud on the court. 473 00:32:22,550 --> 00:32:27,710 The magistrate judge approves testing on the paper contract and also signs off 474 00:32:27,710 --> 00:32:29,710 on a digital forensics investigation. 475 00:32:31,330 --> 00:32:35,890 Zeglia is ordered to turn over his email passwords and all electronic devices. 476 00:32:37,670 --> 00:32:41,050 The case quickly becomes a tale of dueling experts. 477 00:32:42,280 --> 00:32:47,200 Mark Zuckerberg, Facebook, and their experts declined to speak to American 478 00:32:47,200 --> 00:32:48,200 Greed. 479 00:32:48,480 --> 00:32:54,160 So American Greed asked Chicago -based ProTech International to independently 480 00:32:54,160 --> 00:32:57,420 review and explain the findings of Facebook's experts. 481 00:32:58,800 --> 00:33:03,240 The ProTech team includes the founder of the Illinois Attorney General's High 482 00:33:03,240 --> 00:33:09,060 Tech Crimes Unit, as well as a former FBI digital forensics investigator and a 483 00:33:09,060 --> 00:33:10,400 former FBI agent. 484 00:33:11,040 --> 00:33:14,160 Mark Zuckerberg's team did a very good job, very thorough. 485 00:33:14,520 --> 00:33:19,440 They threw everything at it from investigative side to every type of 486 00:33:19,440 --> 00:33:21,800 examiner, linguistics, to look at the emails. 487 00:33:22,920 --> 00:33:26,520 Facebook's experts point out the spacing between the columns. 488 00:33:26,800 --> 00:33:29,360 It's quite different from page one to page two. 489 00:33:30,100 --> 00:33:35,520 The paragraph spacing on page one is messy, but on page two is neat. 490 00:33:36,280 --> 00:33:39,760 And pages one and two use different fonts. 491 00:33:41,450 --> 00:33:47,430 Perhaps most peculiar, the word Facebook is mentioned three times on page one of 492 00:33:47,430 --> 00:33:51,370 the work -for -hire contract, but never appears on page two. 493 00:33:52,470 --> 00:33:56,970 Zuckerberg's legal team suspects Segley may have faked a new page one to go with 494 00:33:56,970 --> 00:33:59,910 the real page two from the Street Facts Project. 495 00:34:01,170 --> 00:34:05,970 Everything's very expensive and time -consuming, and Mark Zuckerberg threw 496 00:34:05,970 --> 00:34:07,570 everything at it, like he should. 497 00:34:08,300 --> 00:34:13,120 However, Seglia's team chalks all that up to the sloppiness of a layman 498 00:34:13,120 --> 00:34:18,780 preparing his own contract. They say their own expert findings prove the 499 00:34:18,780 --> 00:34:19,780 contract is authentic. 500 00:34:20,280 --> 00:34:24,920 One, that the signatures and the initials were Mr. Zuckerberg's. 501 00:34:25,820 --> 00:34:32,139 Two, that the first page and Mr. Zuckerberg's initials match the 502 00:34:32,139 --> 00:34:34,400 indentations on the second page. 503 00:34:34,980 --> 00:34:36,580 That the paper... 504 00:34:36,969 --> 00:34:39,110 came from the same mill and the same run. 505 00:34:39,850 --> 00:34:44,630 That even the staples shows the documents were originally together. 506 00:34:46,429 --> 00:34:51,590 Facebook's digital experts report scouring Seglia's email accounts and 507 00:34:51,590 --> 00:34:54,170 finding any of those supposed emails. 508 00:34:54,630 --> 00:34:59,710 They claim those messages only turn up in Microsoft Word documents, which show 509 00:34:59,710 --> 00:35:01,450 evidence of data tampering. 510 00:35:02,450 --> 00:35:07,410 Facebook and Zuckerberg's experts believe they are entirely bogus, the 511 00:35:07,410 --> 00:35:08,890 of Seglia's imagination. 512 00:35:09,510 --> 00:35:14,750 Any time you have inconsistencies, it casts doubt onto, well, are these 513 00:35:14,750 --> 00:35:18,670 authentic or not? And you kind of start with one thing, and then if you start 514 00:35:18,670 --> 00:35:21,830 finding more, then the evidence kind of builds up, and you kind of can come to 515 00:35:21,830 --> 00:35:23,770 that conclusion that something's been manipulated. 516 00:35:26,060 --> 00:35:31,900 Next on American Greed, a smoking gun discovery and Paul Seglia under arrest. 517 00:35:41,080 --> 00:35:47,440 In July 2011, while examining a hard drive from Seglia's parents' home, 518 00:35:47,700 --> 00:35:53,100 Facebook and Zuckerberg's digital forensics experts say they find a 519 00:35:53,580 --> 00:35:59,060 Inside a sent items folder, the experts discover two e -mails sent back in 2004 520 00:35:59,060 --> 00:36:02,560 to an attorney in Chicago from his mother viewer's account. 521 00:36:02,960 --> 00:36:08,300 The first has the subject line, page one of two for street facts contract with 522 00:36:08,300 --> 00:36:10,720 Mark. The body of the message is signed Paul. 523 00:36:11,160 --> 00:36:15,680 Attached to each message is a low -resolution scanned image of a contract, 524 00:36:15,680 --> 00:36:16,980 doesn't mention Facebook. 525 00:36:17,440 --> 00:36:21,460 Sent items are usually really important for our examinations. 526 00:36:23,360 --> 00:36:24,780 People forget is there. 527 00:36:25,280 --> 00:36:29,680 Facebook and Zuckerberg get a court order to search the e -mail server at 528 00:36:29,680 --> 00:36:30,680 attorney's office. 529 00:36:30,860 --> 00:36:36,520 There they find the same exact e -mails and contract, still there seven years 530 00:36:36,520 --> 00:36:42,000 later. When you can find evidence in independent parties or in independent 531 00:36:42,000 --> 00:36:46,100 places that corroborate your version of events, that makes it very powerful. 532 00:36:46,640 --> 00:36:51,100 The smoking gun is a two -page document titled Street Facts. 533 00:36:51,470 --> 00:36:54,990 When the second pages of the street facts and work -for -hire contracts are 534 00:36:54,990 --> 00:36:57,450 overlaid, they are virtually identical. 535 00:36:58,750 --> 00:37:04,390 The street facts contract resolution is poor, so it's hard to read, but it's 536 00:37:04,390 --> 00:37:07,010 clear enough to see there is no mention of Facebook. 537 00:37:08,250 --> 00:37:13,530 Also found among Zeglia's electronic media is this copy of a handwritten note 538 00:37:13,530 --> 00:37:17,350 from the attorney, which appears to corroborate the poor quality. 539 00:37:18,170 --> 00:37:23,840 It says, Please, please fact me the contract, because I can't read the one 540 00:37:23,840 --> 00:37:24,840 earlier. 541 00:37:25,360 --> 00:37:28,920 That matches up perfectly with the Street Facts documents that are found 542 00:37:28,920 --> 00:37:33,740 are low -res, so I think it provides some significant corroboration to the 543 00:37:33,740 --> 00:37:36,360 that the Street Facts contract is the contract. 544 00:37:36,920 --> 00:37:39,700 But Seglia claims he's been hacked. 545 00:37:40,020 --> 00:37:44,860 He says the smoking gun contract is a fake, which may have been planted by 546 00:37:44,860 --> 00:37:45,860 Zuckerberg himself. 547 00:37:48,140 --> 00:37:53,660 Mr. Zuckerberg's lawyers immediately knew that they wanted to get the 548 00:37:53,660 --> 00:37:58,200 computer. And that's what we wanted to also question Mr. Zuckerberg about. 549 00:37:58,500 --> 00:37:59,840 He's an expert hacker. 550 00:38:01,120 --> 00:38:05,540 As the case moves into its second year, Facebook soars higher. 551 00:38:06,540 --> 00:38:08,060 In January 2012, 552 00:38:08,820 --> 00:38:11,620 Mark Zuckerberg becomes Facebook's chairman of the board. 553 00:38:12,120 --> 00:38:16,160 And in May, the company launches its initial public offering. 554 00:38:16,540 --> 00:38:17,600 This is an awesome moment. 555 00:38:18,200 --> 00:38:20,980 Remember, stay focused and keep shipping. 556 00:38:22,380 --> 00:38:25,860 Facebook is now worth $104 billion. 557 00:38:28,080 --> 00:38:31,780 In October, the site marks 1 billion users. 558 00:38:32,600 --> 00:38:35,580 And the man who claims to own half of it is arrested. 559 00:38:37,230 --> 00:38:42,750 Paul Seglia is criminally charged with mail fraud and wire fraud and accused of 560 00:38:42,750 --> 00:38:47,170 manufacturing evidence in his civil case against Facebook and Zuckerberg. 561 00:38:47,690 --> 00:38:52,510 Seglia claims Zuckerberg's lawyers are calling in favors from friends in high 562 00:38:52,510 --> 00:38:54,770 places. What else do you have to say? Anything? 563 00:38:55,510 --> 00:38:59,970 I say I will have a full statement later for an outreach. 564 00:39:00,950 --> 00:39:02,530 Why? Why do you say that? 565 00:39:04,400 --> 00:39:10,140 Charges from the Southern District of New York, where Gibson Dunn, the world's 566 00:39:10,140 --> 00:39:14,620 dirtiest law firm, seems to be able to pull any strings they want to get their 567 00:39:14,620 --> 00:39:17,080 corporate grimy clients out of any situation. 568 00:39:18,600 --> 00:39:20,340 Seglia pleads not guilty. 569 00:39:20,680 --> 00:39:25,800 While he awaits his criminal trial, Seglia must wear a GPS ankle monitor, 570 00:39:26,040 --> 00:39:30,920 surrender his travel documents, and stay near his home in Wellsville, New York. 571 00:39:31,880 --> 00:39:38,040 On March 26, 2013, exactly 1 ,000 days after Paul Seglia first filed suit, 572 00:39:38,400 --> 00:39:44,040 Magistrate Judge Leslie Faccio recommends Seglia's civil case be 573 00:39:45,740 --> 00:39:50,960 During the past three years, Judge Faccio has weighed more than 5 ,000 574 00:39:50,960 --> 00:39:56,320 court filings. He issues a 155 -page report to explain his decision. 575 00:39:57,040 --> 00:40:01,780 In it, he writes that evidence establishes Seglia's work -for -hire 576 00:40:01,820 --> 00:40:04,100 quote, a recently created fabrication. 577 00:40:04,800 --> 00:40:08,980 The judge effectively said the case had no merit because the key evidence had 578 00:40:08,980 --> 00:40:09,980 been forged. 579 00:40:10,040 --> 00:40:14,720 As for the smoking gun discovery, the contract which makes no mention of 580 00:40:14,720 --> 00:40:19,860 Facebook, the judge writes, clear and convincing evidence establishes the 581 00:40:19,860 --> 00:40:21,700 facts document's authenticity. 582 00:40:22,420 --> 00:40:24,940 This was not a case that was dismissed lightly. 583 00:40:25,850 --> 00:40:29,830 The judge really wanted to make sure, by digging deep into the communication 584 00:40:29,830 --> 00:40:34,550 between Seglia and Zuckerberg, that Seglia's claims were false. 585 00:40:35,430 --> 00:40:39,770 However, the criminal case against him for mail fraud and wire fraud moves 586 00:40:39,770 --> 00:40:40,770 forward. 587 00:40:41,230 --> 00:40:47,630 In March 2015, just two months before his trial is set to begin, Paul Seglia 588 00:40:47,630 --> 00:40:49,570 decides to cut and run. 589 00:40:49,950 --> 00:40:54,850 Paul was very smart. He had his cell phone ready. 590 00:40:55,720 --> 00:40:59,480 He took a photo of the bracelet on his ankle. 591 00:41:00,080 --> 00:41:06,560 He then removed it and put it back together and called the authorities to 592 00:41:06,560 --> 00:41:08,700 there was a small problem with the bracelet. 593 00:41:09,000 --> 00:41:13,940 It's on. I'm fine. And then they sent him a photo of the bracelet on his 594 00:41:14,400 --> 00:41:19,340 Instead, Seglia fastens his ankle monitor to a device he's attached to his 595 00:41:19,340 --> 00:41:23,320 ceiling. The idea is to make it look like he's moving about his house. 596 00:41:24,330 --> 00:41:27,670 Seglia rigs it to a timer and hits the road. 597 00:41:27,950 --> 00:41:33,150 Unfortunately for Paul, the timer failed on him, and that's when they realized 598 00:41:33,150 --> 00:41:34,270 something was going on. 599 00:41:34,570 --> 00:41:38,570 A fugitive's task force arrives, and officers force their way inside. 600 00:41:39,170 --> 00:41:43,730 There they find Seglia's malfunctioning machine, motors still rattling, 601 00:41:44,010 --> 00:41:45,290 bracelets still. 602 00:41:46,510 --> 00:41:51,490 The man who took on Facebook has vanished, along with his wife, two 603 00:41:51,630 --> 00:41:52,870 and the family dog. 604 00:41:55,660 --> 00:41:57,740 Paul Seglia is a fugitive. 605 00:41:58,120 --> 00:42:02,780 Although he has surrendered his passports, he has dual citizenship and 606 00:42:02,780 --> 00:42:07,900 Ireland. The U .S. Marshals are offering a $5 ,000 reward for information 607 00:42:07,900 --> 00:42:09,140 leading to his capture. 608 00:42:11,660 --> 00:42:16,900 In Seglia's absence, his legal team petitions the U .S. Supreme Court in 609 00:42:16,900 --> 00:42:22,280 November 2015, asking it to reopen his dismissed civil lawsuit. 610 00:42:23,100 --> 00:42:24,800 But in January 2016, 611 00:42:25,640 --> 00:42:31,980 the justices declined to hear his case, leaving Paul Seglia on the run with no 612 00:42:31,980 --> 00:42:33,840 hope for a Facebook payday.