1 00:00:01,260 --> 00:00:07,400 In this episode of American Greed, DePaul Wanakawati enjoys a life of 2 00:00:07,400 --> 00:00:11,040 thanks to his medical glove importing empire. 3 00:00:12,340 --> 00:00:16,720 Now he wants to go bigger, hiring American workers. 4 00:00:17,240 --> 00:00:18,440 175 jobs. 5 00:00:18,780 --> 00:00:20,880 It was like almost the answer to our prayers. 6 00:00:21,120 --> 00:00:26,200 But his enterprise is built on false promises and propped up by an 7 00:00:26,200 --> 00:00:30,400 $230 million of other people's money. 8 00:00:31,130 --> 00:00:35,090 He was a skilled manipulator and a gifted con man, and he would use 9 00:00:35,350 --> 00:00:41,650 rip anything from the headlines to kind of add to his story. And nothing will 10 00:00:41,650 --> 00:00:43,330 stop his compulsion for cash. 11 00:00:43,830 --> 00:00:47,210 Not an FBI raid, not even a jail cell. 12 00:00:47,750 --> 00:00:51,230 The man was still a financial danger when he was locked up in jail. 13 00:00:51,720 --> 00:00:56,780 But when everything looks so real, could the biggest lie he's telling be the one 14 00:00:56,780 --> 00:00:57,860 he tells himself? 15 00:00:58,420 --> 00:01:02,600 If some of the truth came out just as the bad thing that I did, I might have 16 00:01:02,600 --> 00:01:03,600 a better chance. 17 00:01:04,000 --> 00:01:09,280 I think he believed his own BS and somehow felt this was all going to have 18 00:01:09,280 --> 00:01:10,280 happy ending. 19 00:01:30,800 --> 00:01:37,100 you have a prepaid call from DePaul Wanakawati, an inmate at Sacramento 20 00:01:37,100 --> 00:01:38,780 Jail. Hi, Mom. 21 00:01:39,940 --> 00:01:42,740 Hi, DePaul. I'm doing fine. 22 00:01:43,520 --> 00:01:48,100 I got the 20 years, but I only have to serve 10. 23 00:01:48,600 --> 00:01:53,280 On the day of his sentencing for one of the biggest cons Sacramento has ever 24 00:01:53,280 --> 00:01:57,020 seen, DePaul Wanakawati cannot stop lying. 25 00:01:58,220 --> 00:02:00,280 Not even to his elderly mother. 26 00:02:01,740 --> 00:02:06,240 The fact is, he'll be locked up for a minimum of 17 years. 27 00:02:07,020 --> 00:02:09,020 I got only 10 years, okay? 28 00:02:10,039 --> 00:02:13,220 At the end of the day, that's better than nothing. 29 00:02:14,900 --> 00:02:21,440 I kept telling you, even though it says 20 years, I only go for 10 years. 30 00:02:21,620 --> 00:02:23,440 How many times do you want me to tell you that? 31 00:02:24,140 --> 00:02:27,700 Earlier this afternoon, he faced a courtroom of victims. 32 00:02:28,080 --> 00:02:32,760 Their tales of heartache and struggle are now being widely reported. 33 00:02:52,570 --> 00:02:54,650 I did what I had to do. 34 00:02:55,270 --> 00:02:56,810 I did what I had to do. 35 00:03:00,510 --> 00:03:06,570 Monica Waddy comes to the U .S. in the late 1960s in a tale that begins more 36 00:03:06,570 --> 00:03:09,470 American dream than American greed. 37 00:03:10,090 --> 00:03:16,850 And his story was he grew up poor in Sri Lanka, dirt floors, 38 00:03:16,890 --> 00:03:23,810 and through tennis was able to overcome his impoverished 39 00:03:23,810 --> 00:03:27,230 childhood, get a scholarship to an American college. 40 00:03:28,370 --> 00:03:34,010 He comes to the U .S. as a junior tennis champion from Sri Lanka, playing on the 41 00:03:34,010 --> 00:03:36,070 team at Georgia Southern University. 42 00:03:38,450 --> 00:03:43,930 After college, he takes a trip west and falls in love with Sacramento, 43 00:03:44,310 --> 00:03:45,310 California. 44 00:03:46,800 --> 00:03:50,460 When he initially came to Sacramento, he was working as a pro, a tennis pro. But 45 00:03:50,460 --> 00:03:54,500 on the side, he had a business, and that was actually selling latex gloves, 46 00:03:54,560 --> 00:03:59,700 rubber gloves, to various tattoo shops, dentists. And, yeah, he did that out of 47 00:03:59,700 --> 00:04:00,700 the back of his car. 48 00:04:02,020 --> 00:04:08,000 In 1988, Wanakawati and his American wife Betsy found International 49 00:04:08,000 --> 00:04:11,720 Manufacturing Group, a medical supply company. 50 00:04:13,560 --> 00:04:16,120 IMG imports medical gloves from Malaysia. 51 00:04:16,730 --> 00:04:20,329 and sometimes goes by the brand name Rely Aid. 52 00:04:24,050 --> 00:04:28,790 Dr. James Oates is a retired dentist who lives in Paso Robles, California. 53 00:04:29,890 --> 00:04:33,850 He builds his practice over many years in suburban Sacramento. 54 00:04:34,450 --> 00:04:39,850 Dr. Oates meets DePaul Wanakawati in the late 1990s when he begins purchasing 55 00:04:39,850 --> 00:04:41,130 supplies from him. 56 00:04:41,640 --> 00:04:46,720 He was an exhibitor at the California Dental Association's scientific 57 00:04:46,920 --> 00:04:53,880 and seeing him in that venue gave credibility to his product 58 00:04:53,880 --> 00:04:59,780 line. But Wanakawati claims his biggest moneymaker isn't retail customers like 59 00:04:59,780 --> 00:05:02,100 Oates. It's government deals. 60 00:05:02,480 --> 00:05:07,300 The most lucrative, he says, is his contract with the U .S. Department of 61 00:05:07,300 --> 00:05:08,300 Veterans Affairs. 62 00:05:09,070 --> 00:05:14,510 He indicated to investors that because of his unique position of being a 63 00:05:14,510 --> 00:05:21,030 minority -type business, he had access to government contracts upwards to 64 00:05:21,030 --> 00:05:22,710 $150 million per year. 65 00:05:24,070 --> 00:05:27,330 However, Wanakawati has a cash flow problem. 66 00:05:28,050 --> 00:05:34,010 He says the factories in Asia need a guarantee of payment, but the VA won't 67 00:05:34,010 --> 00:05:35,110 him until he delivers. 68 00:05:35,490 --> 00:05:36,650 In essence... 69 00:05:37,040 --> 00:05:39,200 He needs collateral for his orders. 70 00:05:40,120 --> 00:05:45,640 So Wanakawati turns to friends and clients to help him import shipping 71 00:05:45,640 --> 00:05:47,760 containers of gloves from Malaysia. 72 00:05:48,720 --> 00:05:54,400 Although they often consider themselves investors, they are actually private 73 00:05:54,400 --> 00:05:55,400 lenders. 74 00:05:56,040 --> 00:06:01,440 DePaul's explanation as to why he needed my money versus a bank was that the 75 00:06:01,440 --> 00:06:07,640 bank interest rates on very short -term high money, loans was 76 00:06:07,640 --> 00:06:13,900 prohibited. Mr. Wanakawati represented to investors that he earned 30 to 40 77 00:06:13,900 --> 00:06:16,120 percent profit on his government contracts. 78 00:06:16,420 --> 00:06:21,540 From that, he told investors that they could receive a share of those profits 79 00:06:21,540 --> 00:06:26,120 anywhere from 10 to upwards and more than 20 percent. 80 00:06:28,020 --> 00:06:32,460 Wanakawati encourages his lenders to roll their investments. 81 00:06:33,800 --> 00:06:38,400 When rolling, investors like Oates still receive their interest payments, but 82 00:06:38,400 --> 00:06:42,700 leave their principal with him to help finance the next shipping container from 83 00:06:42,700 --> 00:06:49,360 Malaysia. Over the years, Dr. Oates rolls several of his loans and says he 84 00:06:49,360 --> 00:06:51,320 Wanakawati nearly $1 million. 85 00:06:52,360 --> 00:06:57,120 Oates says his interest payments come like clockwork and says sometimes 86 00:06:57,120 --> 00:07:01,400 Wanakawati even pays him back big chunks of principal early. 87 00:07:02,330 --> 00:07:08,210 occasionally DePaul would say, I don't need that glove investment, so I'll 88 00:07:08,210 --> 00:07:14,050 you a check. So it added a degree of confidence when he would write me a 89 00:07:14,050 --> 00:07:15,830 to repay my investment. 90 00:07:17,770 --> 00:07:21,550 Wanakawati keeps an open -door policy with his private lenders. 91 00:07:22,090 --> 00:07:26,410 There were numerous investors who we spoke to who actually went down to his 92 00:07:26,410 --> 00:07:30,730 business and wanted to see, feel, and touch the facility. 93 00:07:31,790 --> 00:07:33,230 I could talk to his secretary. 94 00:07:33,550 --> 00:07:36,610 I could see the warehouse full of product. 95 00:07:37,430 --> 00:07:39,070 I was proud to be a part of it. 96 00:07:39,930 --> 00:07:45,410 What's more, many of Wanakawati's lenders consider him a close personal 97 00:07:46,210 --> 00:07:51,170 He would give me tickets to the Kings games in Sacramento, and we just had a 98 00:07:51,170 --> 00:07:56,090 really good, close relationship. Every Christmas, we would exchange Christmas 99 00:07:56,090 --> 00:08:00,490 baskets. He was the kind of guy who would remember if you're... 100 00:08:00,920 --> 00:08:03,980 If you had kids, you'd remember your kids' names. You'd know what sports they 101 00:08:03,980 --> 00:08:05,740 played. He has this gigantic smile. 102 00:08:06,900 --> 00:08:11,320 He is a hugger. He wants to get to know you and shake your hand as soon as you 103 00:08:11,320 --> 00:08:12,219 come into the room. 104 00:08:12,220 --> 00:08:16,160 And by the mid -2000s, Wanakawati has reason to smile. 105 00:08:16,680 --> 00:08:22,640 He's got a hit product on his hands, the Aloe Touch Fitted Glove. I feel less 106 00:08:22,640 --> 00:08:26,320 fatigue in my hands when I use them, and my hands feel smoother. It's a great 107 00:08:26,320 --> 00:08:27,320 combination. 108 00:08:27,799 --> 00:08:33,260 Business seems so good that before long, Wanakawati decides to take it to the 109 00:08:33,260 --> 00:08:34,260 next level. 110 00:08:35,900 --> 00:08:39,400 Eventually, he started telling investors, we'll cut out the middleman. 111 00:08:39,400 --> 00:08:43,059 out the manufacturer. Let's bring manufacturing to California. 112 00:08:43,700 --> 00:08:48,160 Let's put it here where we can control it and make an even greater profit. 113 00:08:49,600 --> 00:08:51,420 Next on American Greed. 114 00:08:51,740 --> 00:08:57,500 Wanakawati brings hope to a town on hard times with a pitch of creating 175 115 00:08:57,500 --> 00:08:59,200 new jobs. 116 00:08:59,480 --> 00:09:04,060 It was like almost the answer to our prayer that he, you know, was talking 117 00:09:04,060 --> 00:09:06,360 that he would use local people. 118 00:09:23,880 --> 00:09:27,100 We all wake up and this nightmare will be just a total dream. 119 00:09:28,380 --> 00:09:30,140 But unfortunately, it's not. 120 00:09:30,480 --> 00:09:33,580 It's gonna be a reality until it gets done, you know? 121 00:09:34,860 --> 00:09:38,680 But you gotta keep your hope alive. If you don't keep hope alive, then 122 00:09:38,680 --> 00:09:39,680 gonna happen, you know? 123 00:09:49,720 --> 00:09:51,500 Forty miles north of Sacramento, 124 00:09:52,410 --> 00:09:57,750 DePaul Wanakawati purchases a shuttered garage door factory in Yuba County. 125 00:09:58,970 --> 00:10:05,010 It's located in the small town of Olivehurst, home to about 14 ,000 126 00:10:05,150 --> 00:10:07,750 including Mary Jane Griego. 127 00:10:09,010 --> 00:10:12,690 Griego owns the local gathering spot, Duke's Diner. 128 00:10:12,910 --> 00:10:18,930 She's lived here since childhood and says that back then, Olivehurst had a 129 00:10:18,930 --> 00:10:19,930 thriving economy. 130 00:10:20,590 --> 00:10:24,570 We had everything here. You know, we had, you know, the canneries. It was all 131 00:10:24,570 --> 00:10:29,250 based around ag and natural resources. We had the trailer factories. We had the 132 00:10:29,250 --> 00:10:30,250 lumber mills. 133 00:10:31,490 --> 00:10:36,110 That started to vanish around the 70s. 134 00:10:36,350 --> 00:10:41,090 Then two major floods devastate the town in the 80s and 90s. 135 00:10:41,590 --> 00:10:45,450 And since that time, Olivehurst has struggled to recover. 136 00:10:45,750 --> 00:10:48,890 In our mall, we have the mall here in the South County. 137 00:10:49,710 --> 00:10:52,390 57 very prosperous businesses. 138 00:10:52,930 --> 00:10:55,490 Not one of them came back. They all left. 139 00:10:55,770 --> 00:10:58,750 Those opportunities that were there left with them. 140 00:10:59,050 --> 00:11:04,850 Griego, who also works as a Yuba County supervisor, meets with Wanakawati and 141 00:11:04,850 --> 00:11:07,450 other county officials in early 2012. 142 00:11:08,830 --> 00:11:14,930 He shares his plans to turn the old facility into a booming new medical 143 00:11:14,930 --> 00:11:19,220 factory. It was like almost the answer to our prayers, you know, when we look 144 00:11:19,220 --> 00:11:23,720 the amount of unemployment that we have in this community, that he, you know, 145 00:11:23,720 --> 00:11:27,180 was talking about the number of people that would be working and that he would 146 00:11:27,180 --> 00:11:28,780 use local people. 147 00:11:29,100 --> 00:11:32,600 That kind of gets you going, you know, you think, oh my goodness, finally. 148 00:11:33,360 --> 00:11:39,940 He tells Yuba County the plant will cost $30 million and bring 175 new 149 00:11:39,940 --> 00:11:40,940 jobs. 150 00:11:42,080 --> 00:11:45,920 He asks county leaders to keep the project quiet at first. 151 00:11:46,220 --> 00:11:51,200 But when word gets out in Olivehurst, the locals' hopes soar. 152 00:11:51,460 --> 00:11:52,880 People were really needing jobs. 153 00:11:53,380 --> 00:11:56,600 So they come into the restaurant and they say, you know, my brother needs a 154 00:11:56,600 --> 00:12:01,000 or my husband needs a job or my son needs a job. Can you put in a good word 155 00:12:01,000 --> 00:12:04,280 me? It was exciting to say, yeah, I would put a good word in for you. 156 00:12:08,010 --> 00:12:11,350 Wanakawati looks for funding from commercial lenders. 157 00:12:11,850 --> 00:12:18,790 He gets a $4 .5 million line of credit from San Jose -based Bridge Bank and 158 00:12:18,790 --> 00:12:22,490 nearly $7 million from Key Equipment Finance. 159 00:12:23,950 --> 00:12:30,530 Wanakawati also turns once again to private lenders, people like Ron Ashley, 160 00:12:30,530 --> 00:12:32,490 has done well as a cosmetic dentist. 161 00:12:33,050 --> 00:12:36,370 He had products. He gave me a few samples. 162 00:12:37,610 --> 00:12:38,610 Real stuff. 163 00:12:38,690 --> 00:12:42,990 You know, as a dentist, I bought lots of latex gloves, but had begun to buy 164 00:12:42,990 --> 00:12:43,990 nitrile. 165 00:12:45,190 --> 00:12:50,990 And that's when he started telling me about this other venture that was his 166 00:12:50,990 --> 00:12:54,990 love of life, was that he wanted to create the first nitrile glove factory 167 00:12:54,990 --> 00:12:55,990 the United States. 168 00:12:57,170 --> 00:13:00,190 Ashley understands having a passion project. 169 00:13:00,550 --> 00:13:05,570 He owns apartments across the West, having invested his dental income into 170 00:13:05,570 --> 00:13:07,930 estate. where he makes his fortune. 171 00:13:08,270 --> 00:13:13,570 For 20 years, from 88 to 08, I did both the apartment business and also 172 00:13:13,570 --> 00:13:18,870 dentistry. My wife and I started with one complex, and now we've grown it to 173 00:13:18,870 --> 00:13:21,450 where we're about 4 ,000 units. 174 00:13:21,790 --> 00:13:24,270 As a dentist with a latex allergy himself, 175 00:13:25,050 --> 00:13:27,130 Ashley is intrigued by the project. 176 00:13:28,150 --> 00:13:30,810 Wanakawati invites him to Olivehurst. 177 00:13:33,740 --> 00:13:39,420 I went to the factory with him. He had plans, kind of like a flow chart of how 178 00:13:39,420 --> 00:13:44,320 it was going to be built and what the machinery looked like and how it would 179 00:13:44,320 --> 00:13:45,800 work. It was very impressive. 180 00:13:49,700 --> 00:13:53,900 There had been a lot of recent electrical work done with a lot of heavy 181 00:13:53,900 --> 00:13:58,740 power cables and conduits and all that kind of stuff that was obviously fresh 182 00:13:58,740 --> 00:13:59,719 and new. 183 00:13:59,720 --> 00:14:05,180 Ashley decides to lend Wanakawati money to purchase and ship the assembly line 184 00:14:05,180 --> 00:14:09,920 equipment. He had all the things down pat that you need to convince somebody 185 00:14:09,920 --> 00:14:13,640 that you're for real. He had a real business location, some real business 186 00:14:13,640 --> 00:14:16,080 records, real contract with the VA. 187 00:14:16,480 --> 00:14:20,080 Before long, Ashley decides to become a partner. 188 00:14:20,800 --> 00:14:27,640 I had sold some apartments, and when I made a decision to invest some 189 00:14:27,640 --> 00:14:28,680 money in the glove factory, 190 00:14:29,450 --> 00:14:34,510 It was a very serious investment. When I started initially, I bought 10%, and I 191 00:14:34,510 --> 00:14:39,890 finally made my way up to 50%. The Ashleys make a series of investments and 192 00:14:39,890 --> 00:14:46,410 loans totaling $22 million, even borrowing some of it to help Wanakawati. 193 00:14:46,410 --> 00:14:49,390 over six months, a fast friendship forms. 194 00:14:49,910 --> 00:14:52,890 He's extremely friendly and acts very sincere. 195 00:14:54,480 --> 00:14:59,020 We play tennis together. We vacation as he and his wife vacation with me and my 196 00:14:59,020 --> 00:15:00,020 wife. 197 00:15:01,180 --> 00:15:06,840 By 2013, DePaul Wanakawati appears as successful as ever. 198 00:15:07,740 --> 00:15:13,020 He lives in a comfortable middle -class home, owns numerous properties around 199 00:15:13,020 --> 00:15:19,700 Sacramento, and has donated at least $25 ,000 to his daughter's private Catholic 200 00:15:19,700 --> 00:15:20,700 high school. 201 00:15:21,740 --> 00:15:27,920 He owns a private jet and three vacation homes, including this $3 million house 202 00:15:27,920 --> 00:15:28,920 in Hawaii. 203 00:15:33,160 --> 00:15:38,960 And he also owns his city's professional tennis team, Sacramento Capitals. 204 00:15:39,540 --> 00:15:43,080 I think there was a personal connection to the tennis team, but it's also part 205 00:15:43,080 --> 00:15:45,200 of the way he would bring people around. 206 00:15:46,220 --> 00:15:50,640 Another thing he would do... I think, to earn trust and demonstrate credibility 207 00:15:50,640 --> 00:15:51,860 to the individual investors. 208 00:15:52,520 --> 00:15:57,620 If you would take him to Hawaii for an all expenses paid trip for a week to his 209 00:15:57,620 --> 00:16:00,580 house in Hawaii, he would fly them out there on his private jet. And people 210 00:16:00,580 --> 00:16:03,860 start to believe that, yeah, this guy is who he claims to be. 211 00:16:04,780 --> 00:16:08,840 But cracks are beginning to show in his warm, confident facade. 212 00:16:10,660 --> 00:16:14,440 Next on American Greed, late payments and a lawsuit. 213 00:16:15,130 --> 00:16:16,810 lead to a federal investigation. 214 00:16:17,670 --> 00:16:22,750 They were peppering me with questions, sucking information out of me. It was 215 00:16:22,750 --> 00:16:23,830 pretty intense. 216 00:16:37,370 --> 00:16:41,670 And this morning when I came down to get breakfast, one guy said, can I call you 217 00:16:41,670 --> 00:16:42,670 Mr. Mogul? 218 00:16:44,080 --> 00:16:45,220 Mr. Mogul. 219 00:16:46,860 --> 00:16:49,820 Can I call you Mr. Mogul? 220 00:16:50,260 --> 00:16:52,720 He said you're constantly on the news. 221 00:16:52,960 --> 00:16:54,220 Constantly on the news. 222 00:16:56,660 --> 00:16:57,340 Sacramento 223 00:16:57,340 --> 00:17:08,020 attorney 224 00:17:08,020 --> 00:17:13,000 Ian Craig represents two of DePaul Wanakawati's largest lenders. 225 00:17:16,359 --> 00:17:21,680 They are prominent home builders who, over several years, lend their friend 226 00:17:21,680 --> 00:17:23,280 than $20 million each. 227 00:17:24,440 --> 00:17:29,740 As their attorney, Craig encourages his clients to formalize their agreements 228 00:17:29,740 --> 00:17:30,800 with Wanakawati. 229 00:17:32,140 --> 00:17:37,040 When I would put documents in front of Mr. Wanakawati, the reluctance to sign 230 00:17:37,040 --> 00:17:38,800 those agreements caused me concern. 231 00:17:39,120 --> 00:17:44,400 My clients come from a different generation, a generation in which a man 232 00:17:44,400 --> 00:17:45,400 good as his word. 233 00:17:45,770 --> 00:17:47,550 They were less concerned than I was. 234 00:17:48,290 --> 00:17:53,470 If they felt comfortable with him, and, you know, I couldn't stand in their way. 235 00:17:54,430 --> 00:17:58,530 In early 2013 comes the moment Craig fears. 236 00:17:59,190 --> 00:18:04,070 Wanakwadi is several months late in making interest payments to his clients. 237 00:18:04,590 --> 00:18:08,050 We started writing letters to Mr. Wanakwadi. 238 00:18:08,700 --> 00:18:09,700 And Mr. 239 00:18:10,020 --> 00:18:14,400 Wanakwadi then would, instead of dealing with me, he would go directly to my 240 00:18:14,400 --> 00:18:18,800 clients and give them, for instance, a letter from the VA saying, hey, my 241 00:18:18,800 --> 00:18:20,320 payment terms have changed. 242 00:18:20,680 --> 00:18:27,020 Well, I used to get paid by the VA in 30 to 60 days. Now it's 90 to 120 days. 243 00:18:28,180 --> 00:18:30,920 Wanakwadi's excuse placates the clients. 244 00:18:31,280 --> 00:18:34,120 But Ian Craig is still suspicious. 245 00:18:35,300 --> 00:18:37,420 Then in the summer of 2013, 246 00:18:38,330 --> 00:18:43,490 Bridge Bank sends one of his clients a subpoena to testify in a deposition. 247 00:18:44,010 --> 00:18:49,550 Bridge Bank is suing DePaul Wanakawati, accusing him of defaulting on his $4 .5 248 00:18:49,550 --> 00:18:52,870 million line of credit. It doesn't make sense to Craig. 249 00:18:53,190 --> 00:18:57,750 If Wanakawati has a contract with the Department of Veterans Affairs worth 250 00:18:57,750 --> 00:19:02,530 than $100 million, he should be able to pay back $4 .5 million. 251 00:19:04,790 --> 00:19:07,270 Alarmed, he meets with a private investigator. 252 00:19:08,010 --> 00:19:12,290 an ex -FBI agent who says he'll reach out to the Bureau. 253 00:19:13,090 --> 00:19:15,630 The next day, Ian Craig gets a call. 254 00:19:16,530 --> 00:19:22,730 Don't tell your clients. Don't tell anyone. We just need you to show up. We 255 00:19:22,730 --> 00:19:27,950 you to bring the documents that you have that are relevant to this, and we're 256 00:19:27,950 --> 00:19:29,090 going to sit down and talk about this. 257 00:19:31,180 --> 00:19:36,600 The following day, he sits down with FBI Special Agent Paul Artley and IRS 258 00:19:36,600 --> 00:19:39,760 Criminal Investigation Special Agent Stephen Delaney. 259 00:19:40,600 --> 00:19:46,380 They were peppering me with questions, sucking information out of me. And I was 260 00:19:46,380 --> 00:19:48,620 in that office for probably five or six hours. 261 00:19:49,060 --> 00:19:51,360 And it was pretty intense. 262 00:19:55,140 --> 00:19:59,460 Agents Artley and Delaney begin by contacting the Department of Veterans 263 00:19:59,460 --> 00:20:00,460 Affairs. 264 00:20:01,350 --> 00:20:05,170 We have two individuals that haven't been paid millions of dollars in 265 00:20:05,170 --> 00:20:06,510 over the last couple of months. 266 00:20:06,970 --> 00:20:12,470 That's all we know at that point. He's shown them a VA contract for hundreds of 267 00:20:12,470 --> 00:20:13,470 millions of dollars. 268 00:20:14,110 --> 00:20:18,590 Well, we have to then try to figure out with the VA if that contract actually 269 00:20:18,590 --> 00:20:22,350 exists. And if it does exist, does it exist for $125 million? 270 00:20:22,770 --> 00:20:25,870 The feds learned he has a contract, all right. 271 00:20:26,410 --> 00:20:31,650 They reviewed it and then told me that, in fact, it was a $25 ,000 per year 272 00:20:31,650 --> 00:20:37,990 contract. $25 ,000 a year is just 0 .02 % of the 273 00:20:37,990 --> 00:20:41,210 $125 million he has shown his lenders. 274 00:20:42,990 --> 00:20:48,510 And remember Wanakawati's excuse that the VA changed its payment terms? 275 00:20:49,650 --> 00:20:52,930 Investigators discovered that Wanakawati's letter from the VA... 276 00:20:53,370 --> 00:20:55,690 is signed by a former employee. 277 00:20:56,370 --> 00:21:01,390 In fact, that individual had worked for the VA, but had worked there five years 278 00:21:01,390 --> 00:21:06,250 earlier. So in effect, it was a fraudulent letter that he was providing 279 00:21:06,250 --> 00:21:07,250 investors. 280 00:21:07,390 --> 00:21:11,730 And the deceit involving Veterans Affairs doesn't stop there. 281 00:21:13,070 --> 00:21:19,010 Back in 2011, to secure his $4 .5 million line of credit from Bridge Bank, 282 00:21:19,470 --> 00:21:21,910 Wanakawati sets up a conference call. 283 00:21:22,380 --> 00:21:24,060 with his contact at the VA. 284 00:21:24,980 --> 00:21:29,780 At the time, the voice on the line says Wanakawati is a valued vendor. 285 00:21:30,460 --> 00:21:32,720 Bridge Bank approves the financing. 286 00:21:34,340 --> 00:21:40,980 But in 2013, when the agents run the rep's name by the VA, they've never 287 00:21:40,980 --> 00:21:41,980 of him. 288 00:21:42,060 --> 00:21:44,740 Is anything this man says true? 289 00:21:46,360 --> 00:21:49,640 Investigators strongly suspect Wanakawati is running a scam. 290 00:21:50,350 --> 00:21:52,150 likely a pyramid scheme. 291 00:21:52,990 --> 00:21:55,410 They know he's been lying to his lenders. 292 00:21:55,890 --> 00:21:58,330 Now they need it on the record. 293 00:21:59,990 --> 00:22:02,590 Next on American Greed, setting a trap. 294 00:22:02,890 --> 00:22:07,270 I never could have imagined in a million years that I'd be working for the feds 295 00:22:07,270 --> 00:22:09,650 as a confidential informant. 296 00:22:22,920 --> 00:22:28,520 pushing it. He says there's a lot of stuff that these guys are not talking 297 00:22:28,520 --> 00:22:31,600 about. They're just hung up on this VA contract. 298 00:22:31,880 --> 00:22:36,040 He said, Paul, you have other businesses going on. It's crazy. He says, I don't 299 00:22:36,040 --> 00:22:37,040 get this. 300 00:22:41,420 --> 00:22:44,220 Sacramento, California, autumn 2013. 301 00:22:48,140 --> 00:22:53,560 FBI and IRS agents have been digging deep into DePaul Wanakawati's business, 302 00:22:53,940 --> 00:22:57,780 International Manufacturing Group, or IMG. 303 00:22:59,460 --> 00:23:05,000 Although he does import medical gloves from overseas, the feds suspect it has 304 00:23:05,000 --> 00:23:08,960 largely become a charade to convince lenders to keep coughing up cash. 305 00:23:10,040 --> 00:23:16,260 Then he pays them back, using other lenders' money. A classic, if well 306 00:23:16,260 --> 00:23:17,340 -disguised, con. 307 00:23:17,980 --> 00:23:22,600 He was able to mask the underlying scheme through a legitimate business 308 00:23:22,600 --> 00:23:27,200 enterprise. They need to catch Wanakawati in his own web of lies. 309 00:23:27,780 --> 00:23:33,400 So they asked Ian Craig, the attorney for two of his largest investors, to 310 00:23:33,400 --> 00:23:34,319 a wire. 311 00:23:34,320 --> 00:23:39,360 I felt that he had committed fraud on my client. 312 00:23:39,600 --> 00:23:46,580 I did not like this person, but I had to pretend and fake a relationship 313 00:23:46,580 --> 00:23:47,579 with him. 314 00:23:47,580 --> 00:23:50,780 Essentially, I had the con, the con man. 315 00:23:51,260 --> 00:23:55,840 Craig convinces Wanakawati to put him in touch with his contact at the 316 00:23:55,840 --> 00:23:57,400 Department of Veterans Affairs. 317 00:23:58,140 --> 00:23:59,660 I said, hi, Mr. Williams. 318 00:24:00,120 --> 00:24:01,260 What's your first name? 319 00:24:02,100 --> 00:24:03,460 Um, Fran. 320 00:24:04,320 --> 00:24:07,500 Okay, Fran Williams. Where are you calling from? 321 00:24:08,440 --> 00:24:10,940 Um, Langley, Virginia. 322 00:24:11,700 --> 00:24:14,940 I thought to myself, I don't think Langley, Virginia is where the... 323 00:24:15,150 --> 00:24:17,030 I thought that was the CIA headquarters. 324 00:24:17,390 --> 00:24:21,570 And I started asking him some fairly pointed questions. How much is the 325 00:24:21,570 --> 00:24:24,350 contract? He recites $100 to $150 million. 326 00:24:25,450 --> 00:24:27,230 What's going on with the payment terms? 327 00:24:28,970 --> 00:24:33,090 We've just been delayed a little bit, whatever his excuse was. 328 00:24:33,310 --> 00:24:37,190 When I started pressing him for a little bit more, all of a sudden, he had to 329 00:24:37,190 --> 00:24:38,190 get off the phone. 330 00:24:38,510 --> 00:24:43,550 And some of those key things that we needed were representations made by Mr. 331 00:24:43,670 --> 00:24:47,310 Wanakowati in a conversation so that we could have that evidence. 332 00:24:47,530 --> 00:24:49,130 He did a fabulous job. 333 00:24:51,090 --> 00:24:56,630 As the criminal investigation heats up, Wanakowati's pro tennis team, the 334 00:24:56,630 --> 00:25:00,590 Sacramento Capitals, announces a move to Las Vegas. 335 00:25:02,150 --> 00:25:07,250 The FBI and IRS need to nail Wanakowati before he skips town, too. 336 00:25:07,900 --> 00:25:10,760 but they'll need more evidence before they can arrest him. 337 00:25:15,220 --> 00:25:22,000 On February 12, 2014, at 6 a .m., with cert warrants in hand, they 338 00:25:22,000 --> 00:25:26,640 strike, raiding his home, business, and the Olivehurst facility. 339 00:25:28,560 --> 00:25:34,720 At the IMG warehouse in West Sacramento, an employee admits to playing the so 340 00:25:34,720 --> 00:25:39,000 -called... VA rep on the bogus conference call with Bridge Bank. 341 00:25:40,440 --> 00:25:45,800 He confesses that Wanakawati had bribed him with a hundred bucks and a bottle of 342 00:25:45,800 --> 00:25:46,800 wine. 343 00:25:47,140 --> 00:25:53,380 He verified that, yeah, DePaul had handed him a script that morning, and 344 00:25:53,380 --> 00:25:54,840 both got on a conference call. 345 00:25:55,140 --> 00:25:58,480 Because I was a new employee, I just wanted to make my boss happy. 346 00:25:58,680 --> 00:26:02,900 He had no clue what he was involved with, and when the agents described... 347 00:26:05,020 --> 00:26:09,800 What they were investigating, the guy just went white. I mean, just almost, 348 00:26:09,800 --> 00:26:10,920 know, he was stunned. 349 00:26:12,760 --> 00:26:16,860 Agent Delaney also corners Wanakawati's chief financial officer. 350 00:26:17,140 --> 00:26:21,180 He wants to see the books on the supposed VA contract. 351 00:26:21,820 --> 00:26:27,120 She tells him she knows nothing about the VA business because Wanakawati alone 352 00:26:27,120 --> 00:26:28,800 manages that division. 353 00:26:29,640 --> 00:26:33,800 He keeps its books and money separate from the rest of the company. 354 00:26:34,430 --> 00:26:39,270 She never sees an invoice and doesn't even know where its bank account is 355 00:26:39,950 --> 00:26:44,890 She accounts for the VA business each month by simply writing down whatever 356 00:26:44,890 --> 00:26:46,970 numbers Wanakowati tells her to. 357 00:26:47,430 --> 00:26:51,730 And then she adds that to the overall company income statement. 358 00:26:52,070 --> 00:26:55,310 The way it's handled, you won't have any paperwork. There's no expenses 359 00:26:55,310 --> 00:26:59,210 associated with it. I give you the entries every month. You post them. 360 00:26:59,830 --> 00:27:01,150 She asks no questions. 361 00:27:02,060 --> 00:27:07,480 But she has been keeping track of those manual income entries, which she turns 362 00:27:07,480 --> 00:27:09,020 over to the IRS agent. 363 00:27:09,400 --> 00:27:16,020 I think we could go back to around 2002. You start to see the financial 364 00:27:16,020 --> 00:27:18,800 statements being adjusted upward. 365 00:27:19,340 --> 00:27:22,360 By the time we finish 2013, 366 00:27:23,120 --> 00:27:27,480 he's up in the $150 to $175 million in sales. 367 00:27:29,360 --> 00:27:35,140 Over in Wanakawati's South Sacramento home, FBI Special Agent Paul Artley and 368 00:27:35,140 --> 00:27:38,840 his team find a treasure trove of fraudulent documents. 369 00:27:40,040 --> 00:27:45,220 Mr. Wanakawati did the old -fashioned cut -and -paste job. So we found 370 00:27:45,220 --> 00:27:49,360 statements that were cut -and -pasted. We found invoices. We found all manner 371 00:27:49,360 --> 00:27:53,640 documents. I don't think that Paul Wanakawati ever used a computer. 372 00:27:54,760 --> 00:28:00,240 Okay, and here he is running one of the largest Ponzi schemes we've ever seen in 373 00:28:00,240 --> 00:28:05,640 the Eastern District of California, and he's using a photocopy machine and a 374 00:28:05,640 --> 00:28:10,080 pair of scissors to cut and paste documents and put them together, and 375 00:28:10,080 --> 00:28:16,160 working. You get a call from Paul, and he's saying, we found a lot, because 376 00:28:16,160 --> 00:28:19,160 tracking with everything that we're seeing from our victims, from their 377 00:28:19,160 --> 00:28:23,540 statements, and I'm almost thinking it can't be, it doesn't get any better than 378 00:28:23,540 --> 00:28:24,540 this. 379 00:28:24,780 --> 00:28:30,520 Meanwhile, the Olivehurst manufacturing facility astounds for the opposite 380 00:28:30,520 --> 00:28:31,520 reason. 381 00:28:31,880 --> 00:28:34,940 The only thing inside the whole factory was an eyewash machine. 382 00:28:35,140 --> 00:28:37,320 That was it. It was empty other than that. 383 00:28:37,660 --> 00:28:42,500 Mr. Wanakwadi told others that he had actually purchased some equipment in 384 00:28:42,500 --> 00:28:47,620 to put into the factory and provided invoices and other documents 385 00:28:47,620 --> 00:28:51,460 that. But in fact, he didn't purchase any equipment. 386 00:28:53,980 --> 00:28:55,380 The factory was a shell. 387 00:28:57,600 --> 00:28:59,360 Next on American Greed. 388 00:29:00,000 --> 00:29:03,260 From inside a Sacramento County jail, he's on the phone talking with people 389 00:29:03,260 --> 00:29:05,760 attempting to salvage the deal. 390 00:29:06,100 --> 00:29:10,040 And his brazen behavior continues inside the courtroom. 391 00:29:10,600 --> 00:29:15,040 And he starts reading this letter and people's jaws are dropping. 392 00:29:15,780 --> 00:29:21,740 Hear more about becoming an FBI informant at AmericanGreed .CNBC .com. 393 00:29:23,440 --> 00:29:24,440 Feeling greedy? 394 00:29:24,600 --> 00:29:28,620 Want inside information about the show? Join the Greed social network. 395 00:29:28,980 --> 00:29:31,400 Like us on American Greed's Facebook page. 396 00:29:31,840 --> 00:29:32,840 We'll be right back. 397 00:29:39,440 --> 00:29:41,200 Why are you prolonging this? 398 00:29:41,940 --> 00:29:43,060 It's so painful. 399 00:29:43,400 --> 00:29:44,480 I just want it to be over. 400 00:29:44,760 --> 00:29:50,840 I understand that. But if I can get a reduced time, don't you think that's the 401 00:29:50,840 --> 00:29:51,840 best? 402 00:29:52,750 --> 00:29:55,270 He's going for a longer time. He's not going to help anybody. 403 00:29:57,150 --> 00:30:02,030 In Sacramento, the feds are moving as fast as they can through the evidence 404 00:30:02,030 --> 00:30:05,390 they've seized from DePaul Wanakawati's home and business. 405 00:30:06,170 --> 00:30:09,610 They are horrified as the victim list grows. 406 00:30:10,150 --> 00:30:15,350 I thought maybe it was two, three, four, five, a handful of investors that had 407 00:30:15,350 --> 00:30:16,390 been taken by this guy. 408 00:30:17,070 --> 00:30:20,390 But it turns out once we got records, once we started looking through the 409 00:30:20,390 --> 00:30:26,290 document that were at his house, we could see that it was going to be much, 410 00:30:26,290 --> 00:30:27,290 larger. 411 00:30:28,250 --> 00:30:34,010 In fact, the very same day of the raid, Wanakawati meets his investor Ron Ashley 412 00:30:34,010 --> 00:30:40,050 for lunch to discuss what he says are delays at customs with the shipment of 413 00:30:40,050 --> 00:30:42,710 assembly lines for the Olivehurst glove factory. 414 00:30:43,170 --> 00:30:45,730 He said, Ron, I just need one final payment. 415 00:30:46,110 --> 00:30:47,110 And then that's it. 416 00:30:47,250 --> 00:30:52,670 And so that payment was, it's a matter of public record, it was $680 ,000. 417 00:30:53,050 --> 00:30:55,910 And he said, that'll be the last we need. 418 00:30:58,010 --> 00:31:03,470 The FBI had been to his house, and yet he was capable of being reasonably 419 00:31:03,470 --> 00:31:06,830 friendly and straight -faced and smiling and saying, thank you, you've really 420 00:31:06,830 --> 00:31:08,770 helped me accomplish something important. 421 00:31:09,710 --> 00:31:13,630 Ashley believes he owns a 50 % stake in the Olivehurst operation. 422 00:31:14,430 --> 00:31:18,430 In exchange for investing in lending Wanakawati the $22 million. 423 00:31:19,750 --> 00:31:22,310 It's amazing what you learn after it's too late. 424 00:31:27,490 --> 00:31:30,990 The glove grifter shows no signs of stopping. 425 00:31:31,370 --> 00:31:35,570 So within a week, agents Artley and Delaney take him down. 426 00:31:36,070 --> 00:31:42,430 When we actually arrested Mr. Wanakawati, he was very friendly, very 427 00:31:42,430 --> 00:31:45,560 cordial. as if you had known him for years. 428 00:31:46,180 --> 00:31:52,140 And within that, I saw how he was able to manipulate people. 429 00:31:55,060 --> 00:31:57,920 Word of Wanakawati's arrest travels fast. 430 00:31:58,300 --> 00:32:05,080 And within days, the dream of 175 new jobs in Oliver's appears to be 431 00:32:05,080 --> 00:32:10,520 dying. It's the momentum that we were, you know, involved in that 432 00:32:10,520 --> 00:32:12,940 felt so credible. 433 00:32:14,060 --> 00:32:18,240 That, you know, and then to have that yanked out from underneath you, it just 434 00:32:18,240 --> 00:32:20,840 makes you very cautious. 435 00:32:21,200 --> 00:32:27,080 Having to explain to the community that this guy was not legitimate, that was a 436 00:32:27,080 --> 00:32:28,080 tough one. 437 00:32:28,500 --> 00:32:33,840 Although he's been jailed on charges of conspiracy, as well as mail wire and 438 00:32:33,840 --> 00:32:38,000 bank fraud, DePaul Wanakawati isn't giving up. 439 00:32:38,800 --> 00:32:43,760 Even from behind bars, he obsesses over capturing more cash. 440 00:32:44,320 --> 00:32:49,020 He was on a recorded line out of the Sacramento County Jail attempting to 441 00:32:49,020 --> 00:32:53,420 salvage a deal with a state -run Chinese corporation. 442 00:32:54,720 --> 00:32:59,860 Months before, they had kind of finalized the deal, signed paperwork, 443 00:32:59,860 --> 00:33:04,920 Chinese corporation was going to give Wanakawati roughly $40 million. 444 00:33:06,160 --> 00:33:10,000 Our estimation was that money would have immediately gone out to pay various 445 00:33:10,000 --> 00:33:11,840 investors that were now asking for money. 446 00:33:13,160 --> 00:33:16,720 The man was still a financial danger when he was locked up in jail. 447 00:33:19,260 --> 00:33:21,060 In March 2014, 448 00:33:21,780 --> 00:33:26,780 DePaul Wanakawati is indicted on charges of bank fraud and making false 449 00:33:26,780 --> 00:33:28,720 statements to a financial institution. 450 00:33:29,720 --> 00:33:31,420 He pleads not guilty. 451 00:33:32,480 --> 00:33:37,060 But after learning all the evidence the government has on him, He changes his 452 00:33:37,060 --> 00:33:38,600 mind and cuts a deal. 453 00:33:39,240 --> 00:33:42,520 He pleads guilty to one count of wire fraud. 454 00:33:45,240 --> 00:33:50,600 Wanakwadi's sentencing is August 7, 2014, at the federal courthouse in 455 00:33:50,600 --> 00:33:51,600 Sacramento. 456 00:33:52,060 --> 00:33:54,300 It was essentially standing room only. 457 00:33:54,940 --> 00:33:58,620 There were a number of victims, and they made up the bulk of the people in the 458 00:33:58,620 --> 00:33:59,620 courtroom. 459 00:33:59,800 --> 00:34:03,320 Wanakwadi stands up in his orange jumpsuit from the county jail. 460 00:34:04,840 --> 00:34:07,200 Juana Kawade interrupts the proceedings. 461 00:34:07,640 --> 00:34:11,860 The judge announces, well, we have a letter here, and he starts reading this 462 00:34:11,860 --> 00:34:14,699 letter, and people's jaws are dropping. 463 00:34:15,400 --> 00:34:21,260 Now, Juana Kawade wants to fire his attorney. He writes, I believe he has 464 00:34:21,260 --> 00:34:24,340 intimidated me into agreeing to the plea agreement. 465 00:34:25,940 --> 00:34:31,199 Never in 20 years have I ever seen that. It was one last chance for him to kind 466 00:34:31,199 --> 00:34:32,199 of control the situation. 467 00:34:33,040 --> 00:34:36,040 So I can imagine that was incredibly difficult for the victims. 468 00:34:36,620 --> 00:34:41,000 The judge apologizes as he postpones the sentencing. 469 00:34:41,239 --> 00:34:45,620 These investors, they had come to just get their pound of flesh, to at least 470 00:34:45,620 --> 00:34:50,360 justice done, to see him sent away for 20 years. 471 00:34:51,199 --> 00:34:54,300 And the whole thing got stopped in its tracks. 472 00:34:55,739 --> 00:34:57,340 Next on American Greed. 473 00:34:58,130 --> 00:35:03,350 Even when he should be down for the count, Wanakawati has a few more jabs to 474 00:35:03,350 --> 00:35:08,410 throw. Who cares what they write in the paper, man? They write good at the time. 475 00:35:19,010 --> 00:35:23,310 If some of the truth came out, I might have had a better chance, you know? 476 00:35:23,690 --> 00:35:25,370 But, you know, the truth never came out. 477 00:35:26,960 --> 00:35:28,900 You know, only the bad things came out. 478 00:35:29,460 --> 00:35:30,800 All the bad things I did. 479 00:35:35,700 --> 00:35:37,060 November 2014. 480 00:35:39,300 --> 00:35:43,900 Three months have passed, and DePaul Wanakawade's guilty plea stands. 481 00:35:44,920 --> 00:35:48,720 He must now face his victims and his punishment. 482 00:35:49,620 --> 00:35:51,460 God bless him. They showed up again. 483 00:35:52,560 --> 00:35:55,640 There was not an empty seat in the courtroom that second time either. 484 00:35:56,090 --> 00:36:02,290 Ron Ashley, the Glove Factory investor who lost nearly $22 million, addresses 485 00:36:02,290 --> 00:36:03,290 the court. 486 00:36:03,550 --> 00:36:07,870 And I looked at him and he would not look at me. He had his face cradled in 487 00:36:07,870 --> 00:36:13,290 hands. So I said, DePaul, you are a sociopath, a person who can rationalize 488 00:36:13,290 --> 00:36:15,330 constant greedy and deceitful behavior. 489 00:36:15,810 --> 00:36:19,350 You have disgraced yourself and disgraced your family in the process. 490 00:36:19,850 --> 00:36:22,670 You are a liar, a serial liar. 491 00:36:22,930 --> 00:36:25,570 DePaul, you are the most evil person I have ever met. 492 00:36:26,030 --> 00:36:27,590 You are truly a scumbag. 493 00:36:28,750 --> 00:36:31,330 His new attorney reads an apology. 494 00:36:31,910 --> 00:36:38,570 And then Judge Troy Nunley sentences DePaul Wanakawati to 20 years in prison, 495 00:36:38,690 --> 00:36:42,550 of which he must serve a minimum of 17. 496 00:36:42,950 --> 00:36:45,850 It was very quiet, very quiet. 497 00:36:46,830 --> 00:36:49,150 And they let him away. 498 00:36:57,130 --> 00:37:00,790 After the tone, please say your first and last name. 499 00:37:01,730 --> 00:37:03,950 DePaul Wanakawati. DePaul Wanakawati. 500 00:37:04,690 --> 00:37:09,710 He calls his daughter afterward and spins a tale that he can make the 501 00:37:09,710 --> 00:37:11,330 magically disappear. 502 00:37:12,210 --> 00:37:13,210 Hi, honey. 503 00:37:14,150 --> 00:37:16,310 Hello. I got it all completed. 504 00:37:17,450 --> 00:37:20,070 Sounds good. I got my 20 -year sentence. 505 00:37:20,690 --> 00:37:24,630 They can't take it away. I'll tell you all the details on Saturday when I see 506 00:37:24,630 --> 00:37:25,630 you, okay? 507 00:37:25,840 --> 00:37:30,840 He also lies to his wife, though she is not so easily fooled. 508 00:37:32,000 --> 00:37:33,000 Hi, honey. 509 00:37:34,220 --> 00:37:35,620 Well, it went good. 510 00:37:35,880 --> 00:37:39,640 I survived it. I survived it. I'm sure, I'm sure. 511 00:37:40,280 --> 00:37:44,420 With the 20 -year term I got, I only have to spend 10 years. 512 00:37:45,120 --> 00:37:50,620 And the spin continues as he calls his elderly mother. 513 00:37:51,220 --> 00:37:54,380 Who cares what they write in the paper, man? They write books. 514 00:38:05,640 --> 00:38:12,620 I think to some degree he believed, we all know what the word BS means, but 515 00:38:12,620 --> 00:38:18,260 I think he believed his own BS and somehow felt this was all going to have 516 00:38:18,260 --> 00:38:19,260 happy ending. 517 00:38:26,640 --> 00:38:28,460 In January 2016, 518 00:38:29,300 --> 00:38:33,100 DePaul Wanakawati sends a letter to American Greed. 519 00:38:33,380 --> 00:38:38,260 He points a finger at an investor, one of Ian Craig's clients. 520 00:38:38,840 --> 00:38:44,600 He writes, I was a highly paid servant for a rich man whose housing business 521 00:38:44,600 --> 00:38:46,060 crashed in 2008. 522 00:38:47,100 --> 00:38:53,000 He continues, American Greed should focus on who ended up with all the money 523 00:38:53,000 --> 00:38:55,400 from the investors and the real facts. 524 00:38:55,960 --> 00:38:59,500 And nowhere, of course, either in the plea agreement or in that apology, did 525 00:38:59,500 --> 00:39:04,200 try to blame anybody else. And it's now in retrospect. But it doesn't surprise 526 00:39:04,200 --> 00:39:09,560 me that he would try to blame somebody else because he is a sociopath, because 527 00:39:09,560 --> 00:39:14,180 he is evil, and because he probably just can't handle the accountability of it 528 00:39:14,180 --> 00:39:18,660 all. Our evidence from the investigation indicated that Mr. Wanakawati did this 529 00:39:18,660 --> 00:39:19,660 all himself. 530 00:39:19,960 --> 00:39:23,980 There were no other individuals involved who participated with him. 531 00:39:24,700 --> 00:39:27,620 assisted him or knew of his scheme. 532 00:39:28,140 --> 00:39:32,100 Perhaps the weight of his wickedness is too much to bear. 533 00:39:32,640 --> 00:39:38,940 Over 12 years, he takes in more than $230 million from more than 150 534 00:39:38,940 --> 00:39:39,940 and lenders. 535 00:39:40,520 --> 00:39:44,600 Losses stand in excess of $100 million. 536 00:39:47,100 --> 00:39:53,760 Losing $380 ,000 to DePaul is certainly a shock. 537 00:39:54,170 --> 00:39:58,590 You know, I do have cash assets that are in good, solid investments, so, you 538 00:39:58,590 --> 00:40:05,410 know, I'm lucky that way. I don't live an extravagant lifestyle, and so what I 539 00:40:05,410 --> 00:40:07,350 have left has got to last. 540 00:40:08,230 --> 00:40:10,930 The damage extends far beyond the scheme. 541 00:40:12,010 --> 00:40:15,750 His pro tennis team is terminated by its league. 542 00:40:16,150 --> 00:40:18,330 They never played a single match in Las Vegas. 543 00:40:21,090 --> 00:40:22,650 And in Yuba County... 544 00:40:23,050 --> 00:40:28,070 Olive Hurst grieves the loss of those 175 manufacturing jobs. 545 00:40:29,070 --> 00:40:35,970 DePaul was such a big disappointment, but I think the idea 546 00:40:35,970 --> 00:40:41,130 that he had was really good. I just think that, you know, he was there for a 547 00:40:41,130 --> 00:40:45,390 different reason, but I think that maybe one day we'll have that manufacturing 548 00:40:45,390 --> 00:40:50,430 here, and we'll be wise. I mean, we're always optimistically, maybe a little 549 00:40:50,430 --> 00:40:54,900 bit... We're cautiously optimistic now, but we are still optimistic. 550 00:40:55,420 --> 00:40:56,680 Very good. All right. 551 00:40:57,420 --> 00:41:01,240 It's hard to tell with Juana Kawade. Did he ever really intend to build this 552 00:41:01,240 --> 00:41:05,480 factory or didn't he? You just don't know with him. He was a skilled 553 00:41:05,480 --> 00:41:10,260 and a gifted con man, and he would use anything, rip anything from the 554 00:41:10,260 --> 00:41:15,940 to kind of add to his story. Every story that he told had a kernel of truth in 555 00:41:15,940 --> 00:41:18,180 there. You know, yes, he did have a contract with the VA. 556 00:41:19,080 --> 00:41:23,000 It was for $25 ,000, not $120 million. 557 00:41:23,600 --> 00:41:29,820 And there was a facility that he had in Olivehurst, but it wasn't functional, 558 00:41:29,980 --> 00:41:31,460 and there was no equipment in it. 559 00:41:32,000 --> 00:41:34,560 I don't really care what anybody says, Mom. 560 00:41:35,160 --> 00:41:39,900 No, no. I don't care, okay? I don't care what anybody thinks. I don't really 561 00:41:39,900 --> 00:41:42,440 care, okay? I don't want to hear it, okay? 562 00:41:42,660 --> 00:41:43,660 It doesn't matter. 563 00:41:47,630 --> 00:41:53,990 Of the $22 million he entrusts to Wanakawati, Ron Ashley gets only $300 564 00:41:53,990 --> 00:41:55,490 ,000 back. 565 00:41:56,330 --> 00:42:00,810 The money that I lost, my wife and I, we made that money. We started out as poor 566 00:42:00,810 --> 00:42:02,790 people, too. Blue collar, definitely. 567 00:42:03,270 --> 00:42:06,930 I've been pretty successful in life, but I've worked really hard for it. My wife 568 00:42:06,930 --> 00:42:09,210 has been by my side. We've worked hard together. 569 00:42:09,530 --> 00:42:14,590 And it's a great sense of loss. 570 00:42:15,400 --> 00:42:18,400 Some people might really kill themselves in despair. 571 00:42:18,800 --> 00:42:22,440 And some people might drink themselves to death in despair. 572 00:42:23,260 --> 00:42:27,920 Or you pick yourself up, dust yourself off, and just keep going. 573 00:42:28,160 --> 00:42:29,220 And that's what I've done. 574 00:42:30,320 --> 00:42:33,600 The most powerful thing any city has is its people. 575 00:42:33,820 --> 00:42:34,920 Together, we'll rebuild. 576 00:42:35,280 --> 00:42:36,440 Together, we'll reinvent. 577 00:42:36,800 --> 00:42:38,120 Together, we'll hustle. 578 00:42:38,460 --> 00:42:40,300 From executive producer LeBron James. 579 00:42:40,660 --> 00:42:44,080 Cleveland Hustles. Series premiere Wednesday at 10. PNBC. 580 00:42:44,300 --> 00:42:45,300 Get yours. 581 00:42:45,320 --> 00:42:47,700 I'm 100 % in charge. The Prophet. 582 00:42:48,040 --> 00:42:49,480 Season premiere Tuesday at 10.