1 00:00:00,680 --> 00:00:06,360 In this episode of American Greed, brazen con man John Bravado welcomes 2 00:00:06,360 --> 00:00:12,140 investors into BBC Equities, a real estate fund that some insiders call the 3 00:00:12,140 --> 00:00:13,760 Billionaire Boys Club. 4 00:00:14,180 --> 00:00:19,640 I got to tell you that, and this is a bold statement, we'll back it up, not 5 00:00:19,640 --> 00:00:21,280 of our clients ever lost a dollar. 6 00:00:21,880 --> 00:00:26,940 Bravado's Bravado guarantees investors he can make them rich with no risk to 7 00:00:26,940 --> 00:00:27,940 their life savings. 8 00:00:28,410 --> 00:00:31,930 The philosophy that we have and what we use is very simple. Never put your 9 00:00:31,930 --> 00:00:32,970 principal dollars at risk. 10 00:00:33,490 --> 00:00:35,530 Never put your principal dollars at risk. 11 00:00:36,250 --> 00:00:42,150 He brings in over $50 million, saying that all the other financial pros are 12 00:00:42,150 --> 00:00:44,150 crooks. But he's different. 13 00:00:44,570 --> 00:00:47,570 We believe if we can make the investor money, we deserve to make money. And if 14 00:00:47,570 --> 00:00:49,010 we can't, we don't deserve to get paid. 15 00:00:49,330 --> 00:00:54,630 But when the billionaire boys club crumbles, investors learn that Bravada 16 00:00:54,630 --> 00:00:57,450 regrets about doing exactly what his book title says. 17 00:00:58,709 --> 00:01:00,490 Stealing the wealth of America. 18 00:01:01,390 --> 00:01:07,150 There's not anything that I have done that I look at and say, God damn, I wish 19 00:01:07,150 --> 00:01:08,150 didn't do that again. 20 00:01:08,490 --> 00:01:13,770 And many victims are left wishing they'd listen to one piece of this con man's 21 00:01:13,770 --> 00:01:14,770 advice. 22 00:01:15,090 --> 00:01:17,130 I don't want you to believe anything that I say. 23 00:01:18,090 --> 00:01:20,750 What you must do is say, prove it to me. 24 00:01:38,350 --> 00:01:43,690 In the suburbs outside Detroit, Michigan, con man John Bravada has been 25 00:01:43,690 --> 00:01:48,010 an investment scam that has brought in more than $50 million. 26 00:01:49,190 --> 00:01:55,330 In 2011, with the feds closing in, he's working out a possible escape plan. 27 00:01:56,310 --> 00:02:01,190 Mail fraud and wire fraud, if those are the charges, don't even carry criminal 28 00:02:01,190 --> 00:02:03,150 jail time in Italy. 29 00:02:03,630 --> 00:02:08,100 There's never been a case in Italy that they can find where... Italy actually 30 00:02:08,100 --> 00:02:12,360 allowed an extradition in a case that's greater punishment than their own. 31 00:02:14,420 --> 00:02:20,240 Thinking he can avoid justice overseas, Bravada rents an apartment in Milan and 32 00:02:20,240 --> 00:02:24,040 begins researching how to become an Italian citizen. 33 00:02:25,220 --> 00:02:29,280 To the FBI, his actions mean only one thing. 34 00:02:30,000 --> 00:02:34,300 I truly believe John Bravada was looking to go to Italy and never return. 35 00:02:44,460 --> 00:02:50,280 John Bravada grew up modestly, raised alone by his widowed mother in 36 00:02:50,300 --> 00:02:51,300 Michigan. 37 00:02:52,080 --> 00:02:57,600 Though he says he dreams of working for the CIA, he never finishes college. 38 00:03:00,100 --> 00:03:06,360 In his 20s, Bravada works as a cop in his hometown, noting on his application 39 00:03:06,360 --> 00:03:09,640 that he likes being in the middle of attention. 40 00:03:10,960 --> 00:03:15,280 Though he will later claim to work for the Drug Enforcement Agency, it's out on 41 00:03:15,280 --> 00:03:20,160 patrol in Kalamazoo that he first gets a view of the good life. 42 00:03:21,140 --> 00:03:25,380 John, while he was working in law enforcement, while he was driving 43 00:03:25,380 --> 00:03:30,220 would observe some of the nicer communities, nicer homes that he would 44 00:03:30,920 --> 00:03:34,620 And that was the type of lifestyle that he wanted to have for himself and his 45 00:03:34,620 --> 00:03:35,620 family. 46 00:03:36,690 --> 00:03:41,470 Bravada gets his shot at riches when he hands in his badge and begins selling 47 00:03:41,470 --> 00:03:46,530 life insurance, first for John Hancock and later at New York Life. 48 00:03:47,390 --> 00:03:54,190 He was a solid salesman, and his book of business grew appreciably in 49 00:03:54,190 --> 00:03:57,030 not a long period of time. 50 00:03:58,510 --> 00:04:01,290 But Bravada sets his sights higher. 51 00:04:02,930 --> 00:04:05,090 Eventually, he moves to Brighton, Michigan. 52 00:04:05,560 --> 00:04:08,600 a small town about 40 miles northwest of Detroit. 53 00:04:10,960 --> 00:04:17,660 It's here, in 2003, that John opens the Bravada Financial Group, running it out 54 00:04:17,660 --> 00:04:20,660 of this unassuming building on a busy commercial strip. 55 00:04:21,700 --> 00:04:27,420 Three years later, he launches BBC Equities, a real estate investment fund. 56 00:04:28,400 --> 00:04:31,400 Bravada partners with Richard R .J. 57 00:04:31,620 --> 00:04:35,460 Trabulsi. who he had previously hired at New York Life. 58 00:04:36,380 --> 00:04:42,660 To R .J., Mr. Bravado was a father figure, and he was a young, 59 00:04:42,660 --> 00:04:46,280 individual who looked up to John Bravado. 60 00:04:46,840 --> 00:04:48,980 John pulled all the strings at BBC. 61 00:04:49,380 --> 00:04:53,840 He was the figure that was larger than life. He projected himself as larger 62 00:04:53,840 --> 00:04:55,700 life, and I think R .J. bought into that. 63 00:05:00,780 --> 00:05:07,320 From the very start, Bravada is out in front, making the right impression the 64 00:05:07,320 --> 00:05:09,040 moment he walks in the door. 65 00:05:09,900 --> 00:05:14,500 When you first look at John Bravada, John comes across as very polished. 66 00:05:15,520 --> 00:05:21,620 Salt -and -pepper gray hair, mustache, custom suit, cusslings, monogrammed 67 00:05:21,620 --> 00:05:22,620 shirts. 68 00:05:23,120 --> 00:05:24,640 He's a huge guy. 69 00:05:25,400 --> 00:05:26,420 He's tall. 70 00:05:26,680 --> 00:05:27,720 He's muscular. 71 00:05:28,540 --> 00:05:34,600 He has these form -fitting suits, and he stands out in a crowd. I mean, he 72 00:05:34,600 --> 00:05:36,960 steals all the oxygen in a room. 73 00:05:38,280 --> 00:05:44,980 Driving a $90 ,000 Ferrari, Robata knows the importance of projecting wealth. 74 00:05:45,560 --> 00:05:50,480 John Robata's thing was that... This is the only industry where people will 75 00:05:50,480 --> 00:05:55,000 drive up in their Mercedes or their BMWs and hand over all their money to their 76 00:05:55,000 --> 00:05:58,120 financial advisor who rents an apartment and drives a Yugo. 77 00:05:59,120 --> 00:06:03,740 The point that he was making was that that's crazy and you should invest with 78 00:06:03,740 --> 00:06:07,460 someone like me because that would guarantee that their investment would be 79 00:06:07,460 --> 00:06:09,180 successful as his was. 80 00:06:10,690 --> 00:06:13,570 So what's the secret of his success? 81 00:06:14,190 --> 00:06:19,150 Not long after starting BBC Equities, Bravada is at the Ritz -Carlton Hotel 82 00:06:19,150 --> 00:06:22,490 giving a presentation to a few dozen people. 83 00:06:22,790 --> 00:06:28,370 At first, it's not even obvious that Bravada is actually selling anything. 84 00:06:29,110 --> 00:06:32,850 A John Bravada sales pitch would last almost exactly an hour. 85 00:06:33,420 --> 00:06:37,360 He never mentioned BBC equities for the first 50 minutes. What he did for the 86 00:06:37,360 --> 00:06:41,840 first 50 minutes was instill terror in the audience about the dangers of 87 00:06:41,840 --> 00:06:46,240 investing. For most people out in this room, you sat and watched your wealth 88 00:06:46,240 --> 00:06:47,240 disappear. 89 00:06:47,420 --> 00:06:54,080 And you did it because your financial planners, the media, said do what? 90 00:06:54,580 --> 00:06:59,100 Stay still. By the end of that 50 minutes, you were terrified and you 91 00:06:59,100 --> 00:07:00,500 know what to do with your money? 92 00:07:01,140 --> 00:07:02,460 The last 10 minutes? 93 00:07:03,140 --> 00:07:06,900 Basically, it was John Bravada saying, I alone can help you. 94 00:07:07,700 --> 00:07:13,220 I got to tell you that, and this is a bold statement, we'll back it up. Not 95 00:07:13,220 --> 00:07:14,900 of our clients ever lost a dollar. 96 00:07:16,080 --> 00:07:22,480 The way Bravada can help is by offering investors a piece of his so -called real 97 00:07:22,480 --> 00:07:23,480 estate empire. 98 00:07:23,880 --> 00:07:28,580 Flipping through slides, Bravada shows off properties where tenants are paying 99 00:07:28,580 --> 00:07:32,080 rent and generating big bucks for his investors. 100 00:07:32,800 --> 00:07:37,040 He made it sound like his company had already acquired a huge real estate 101 00:07:37,040 --> 00:07:42,200 portfolio that was already cash flowing. And he couldn't get to the bank fast 102 00:07:42,200 --> 00:07:44,180 enough because they were producing so much cash. 103 00:07:45,740 --> 00:07:51,820 In this pitch, recorded later, Rabada hits upon a point he hammers home time 104 00:07:51,820 --> 00:07:52,820 time again. 105 00:07:53,180 --> 00:07:57,860 BBC equities is not only lucrative, it's also safe. 106 00:07:58,700 --> 00:07:59,740 Number one rule. 107 00:08:00,250 --> 00:08:03,250 my money and principal of my dollars must be guaranteed. 108 00:08:04,030 --> 00:08:07,130 I cannot risk losing my principal dollars. 109 00:08:07,930 --> 00:08:13,170 Rule number two, I must get as high of interest rate I can get on my money 110 00:08:13,170 --> 00:08:15,130 without violating rule number one. 111 00:08:17,130 --> 00:08:21,470 Bravado says his fund is structured with safety in mind. 112 00:08:22,030 --> 00:08:23,830 At BBC Equities... 113 00:08:24,220 --> 00:08:25,620 Our fund's set up a little bit different. 114 00:08:25,940 --> 00:08:29,300 BBC Equity guarantees principal dollars of money that goes into the fund. It's 115 00:08:29,300 --> 00:08:32,360 backed by CDs at a bank, Comerica Bank. They're a trust company. 116 00:08:32,740 --> 00:08:33,940 So principal's guaranteed. 117 00:08:37,080 --> 00:08:42,480 Bravada claims that for every investor dollar stored safely at Comerica, the 118 00:08:42,480 --> 00:08:45,940 bank will lend him $2 to make real estate purchases. 119 00:08:47,040 --> 00:08:52,840 A six -year -old investor who has a modest nest egg, the notion of it being 120 00:08:52,840 --> 00:08:57,910 protected, and kept safe in a certificate of deposit, but with the 121 00:08:57,910 --> 00:09:01,230 large interest rate that you couldn't normally get in a certificate of 122 00:09:01,430 --> 00:09:06,650 and on top of a large fixed interest rate, a profit dividend, that was 123 00:09:06,750 --> 00:09:08,490 That was the best of all possible worlds. 124 00:09:09,270 --> 00:09:15,150 On top of this guaranteed protection, Rabada promises investors between 8 % 125 00:09:15,150 --> 00:09:18,870 12 % interest, as well as potential dividends. 126 00:09:19,710 --> 00:09:22,530 You get 12 % as fixed, it's guaranteed, it's paid quarterly. 127 00:09:23,080 --> 00:09:25,820 That money can be reinvested or taken out, whatever you decide to do. 128 00:09:26,180 --> 00:09:30,020 Last year, we did pay a dividend. Our dividend was a 10 % dividend, which 129 00:09:30,020 --> 00:09:33,100 our stockholders or our investors saw a 22 % rate of return. 130 00:09:34,280 --> 00:09:39,520 Roboto lets investors know that the way he gets paid is different than most fund 131 00:09:39,520 --> 00:09:40,520 managers. 132 00:09:41,000 --> 00:09:46,720 Here's the deal I made. I went out to my people and said, I don't want a salary 133 00:09:46,720 --> 00:09:47,720 from BBC Industries. 134 00:09:48,680 --> 00:09:50,680 I don't want to get paid off management. 135 00:09:51,790 --> 00:09:55,250 What I want to get paid off, if I can do what I say I'm going to do for this 136 00:09:55,250 --> 00:09:57,830 fund, that is create profit, which is the dividend. 137 00:09:58,430 --> 00:09:59,730 I deserve to get paid. 138 00:10:00,130 --> 00:10:02,610 But if I can't do that, I don't deserve to get a paycheck. 139 00:10:03,330 --> 00:10:05,130 And that's how this fund works. 140 00:10:07,390 --> 00:10:08,890 Investors like what they hear. 141 00:10:09,290 --> 00:10:13,970 And right away, his former insurance clients, friends, neighbors, and even 142 00:10:13,970 --> 00:10:16,250 family begin to sign up. 143 00:10:17,070 --> 00:10:18,070 I think. 144 00:10:18,120 --> 00:10:22,500 The thing that hooked most investors was his promise that their nest egg would 145 00:10:22,500 --> 00:10:25,840 be safe. No matter what, you will not lose your principal dollars. 146 00:10:26,160 --> 00:10:31,120 And to a lot of these older investors, that was everything to them. 147 00:10:33,840 --> 00:10:38,720 If they have doubts, many seem reassured by Bravado's claims about his law 148 00:10:38,720 --> 00:10:39,780 enforcement days. 149 00:10:40,430 --> 00:10:43,550 My dream was to get in the CIA. I worked for the Drug Enforcement Agency for 150 00:10:43,550 --> 00:10:47,910 about three years. I think what that does, that builds trust amongst the 151 00:10:47,910 --> 00:10:49,590 that he wanted to have invest with his company. 152 00:10:50,550 --> 00:10:53,970 Others are hooked by Bravado's verbal jujitsu. 153 00:10:54,950 --> 00:10:59,050 He said things like, don't ever trust a word I'm saying. 154 00:10:59,290 --> 00:11:01,250 I don't want you to believe anything that I say. 155 00:11:01,830 --> 00:11:04,330 I want you to research it yourself. 156 00:11:04,710 --> 00:11:07,030 What you must do is say, prove it to me. 157 00:11:07,550 --> 00:11:12,550 Well, ironically, if somebody tells you don't trust anything I'm saying, it 158 00:11:12,550 --> 00:11:13,550 engenders credibility. 159 00:11:15,630 --> 00:11:22,010 Between May 2006 and February 2007, BBC Equities received $3 160 00:11:22,010 --> 00:11:24,730 .2 million from investors. 161 00:11:25,250 --> 00:11:27,590 And things are just getting started. 162 00:11:30,440 --> 00:11:36,360 Terry Makowski comes to Bravada's office in late 2007, seeking a job as a 163 00:11:36,360 --> 00:11:37,360 marketing coordinator. 164 00:11:38,300 --> 00:11:43,440 He's interviewed by one of John Bravada's employees, his son, a recent 165 00:11:43,440 --> 00:11:45,640 school grad named Antonio. 166 00:11:46,890 --> 00:11:52,470 He was asking the slighted questions for the typical interview, you know, where 167 00:11:52,470 --> 00:11:54,410 do you see yourself in five years, ten years? 168 00:11:54,690 --> 00:11:58,710 And so I asked him, I said, well, where do you see yourself by the time you're 169 00:11:58,710 --> 00:12:01,390 30? And he said, I see myself being a billionaire. 170 00:12:02,970 --> 00:12:07,750 Amazed by Antonio's pluck, Makowski then meets the head honcho. 171 00:12:09,240 --> 00:12:14,360 John was interesting. He was very nice. He's very charismatic. I mean, he really 172 00:12:14,360 --> 00:12:16,200 puts you at ease when you meet him. 173 00:12:16,520 --> 00:12:21,540 And John had this way of when you're talking to him, like you're the only 174 00:12:21,540 --> 00:12:22,540 in the room. 175 00:12:30,860 --> 00:12:34,980 So this is the location, one of the locations that we held a seminar at, 176 00:12:35,000 --> 00:12:38,620 actually several, Outback Steakhouse in Canton on Ford Road. 177 00:12:40,520 --> 00:12:45,360 Working with a marketing company, she sends invites to Bravada's preferred 178 00:12:45,360 --> 00:12:46,360 audience. 179 00:12:47,140 --> 00:12:51,320 He said he wanted the 55 to 80 -year -olds because they were going into 180 00:12:51,320 --> 00:12:56,160 retirement or have been in retirement and have access to lump sums of cash. 181 00:12:59,000 --> 00:13:00,880 Next on American Greed. 182 00:13:01,380 --> 00:13:07,560 After luring retirees with the promise of a free meal, John Bravada gets them 183 00:13:07,560 --> 00:13:08,800 fork over millions. 184 00:13:09,500 --> 00:13:11,020 He could have sold these people anything. 185 00:13:11,740 --> 00:13:15,020 He was a good salesman. Yeah, he could have sold them anything. 186 00:13:28,590 --> 00:13:34,090 John Bravada has a pitch that seems custom -tailored to his retirement -aged 187 00:13:34,090 --> 00:13:35,090 audience. 188 00:13:35,230 --> 00:13:39,910 I believe that your principal dollar is your life. 189 00:13:40,450 --> 00:13:44,030 You must not, you cannot rip your personal dollar. 190 00:13:44,930 --> 00:13:48,530 Okay? Because you can't afford to lose $34 ,000 and get it back. 191 00:13:49,110 --> 00:13:50,770 It took your whole life to build it. 192 00:13:51,270 --> 00:13:58,090 As Bravada brings in more and more money, he hires others to make the pitch 193 00:13:58,090 --> 00:14:00,710 following the script he's perfected. 194 00:14:01,290 --> 00:14:06,670 One of the first to take the job is John's son, Antonio, who tries his 195 00:14:06,670 --> 00:14:08,790 to follow his dad's lead. 196 00:14:09,590 --> 00:14:12,750 Last year we did pay a dividend. Our dividend was a 10 % dividend. 197 00:14:13,070 --> 00:14:15,710 For 2007, we paid a 10 % dividend. 198 00:14:15,990 --> 00:14:19,710 Which means our stockholders or our investors saw a 22 % rate of return. 199 00:14:20,050 --> 00:14:24,010 If you had your money last year for 2007, you would have made 22%. 200 00:14:26,569 --> 00:14:31,270 Antonio, in turn, helps bring in other pitchmen, including his former football 201 00:14:31,270 --> 00:14:33,150 coach, Jeff Minock. 202 00:14:34,210 --> 00:14:36,850 I said, I don't know nothing about the financial business. 203 00:14:37,470 --> 00:14:41,470 And they go, oh, don't worry. We'll teach you everything you need to know. 204 00:14:42,070 --> 00:14:44,630 We'll give you a script. You've got to memorize the script. 205 00:14:45,130 --> 00:14:49,990 And they said, we'll have agents with you so you don't have to sell anything. 206 00:14:50,190 --> 00:14:51,570 You just have to do the presentation. 207 00:14:53,160 --> 00:14:57,840 For the bravadas, it seems that knowing what you're talking about is less 208 00:14:57,840 --> 00:15:00,340 important than looking like you do. 209 00:15:00,820 --> 00:15:04,340 The day they hired me, they asked me if I had any suits. 210 00:15:04,660 --> 00:15:08,540 And I said, I got one. I said, I can get married and buried. 211 00:15:09,440 --> 00:15:16,340 And they took me down to a men's clothing store where they make custom 212 00:15:16,340 --> 00:15:19,160 suits. And they bought me two suits. 213 00:15:19,400 --> 00:15:21,720 As a matter of fact, the suit I'm wearing right now. 214 00:15:23,330 --> 00:15:25,390 the Bravada bought formula. 215 00:15:27,130 --> 00:15:32,590 Once he's been made to look the part, Minock is ready to get out there and 216 00:15:32,590 --> 00:15:33,590 pitching. 217 00:15:34,150 --> 00:15:38,470 John Bravada used to have us talk a little bit about BBC equities. 218 00:15:38,710 --> 00:15:45,250 He didn't want us to talk a lot about it. Just talking about the 8 % return 219 00:15:45,250 --> 00:15:50,630 that your principal was safe and your money would go into a CD at Comerica 220 00:15:52,880 --> 00:15:57,260 Terry Welsh gets the invite to a bravado seminar in 2008. 221 00:15:57,920 --> 00:16:03,180 A workplace safety trainer from Lansing, Michigan, Welsh eats his free meal, 222 00:16:03,380 --> 00:16:06,340 listens to the pitch, and likes what he hears. 223 00:16:07,260 --> 00:16:11,680 There was probably two things. The first thing was the fact that they said that 224 00:16:11,680 --> 00:16:15,980 they were guaranteeing that the investors would not lose money. 225 00:16:16,840 --> 00:16:22,500 The second thing was it sounded like they had a very, very timely business 226 00:16:22,500 --> 00:16:24,700 strategy that could be very profitable. 227 00:16:26,120 --> 00:16:28,960 Welsh says he'd like to hear more. 228 00:16:29,460 --> 00:16:35,500 And a few weeks later, Antonio Bravada visits him and his wife Janice at their 229 00:16:35,500 --> 00:16:36,500 home. 230 00:16:37,000 --> 00:16:41,720 Yeah, that was him in the picture, absolutely. And I remember when he sat 231 00:16:41,720 --> 00:16:45,160 in that chair. I still remember him just sitting. 232 00:16:46,030 --> 00:16:49,650 there and talking to us like he was a friend. We had a face -to -face 233 00:16:49,650 --> 00:16:51,070 conversation with him. 234 00:16:51,410 --> 00:16:58,150 And also I remember him having on a really fancy ring, a very, very nice 235 00:16:58,330 --> 00:17:03,310 And when we looked out the window, he had an extremely expensive car. 236 00:17:05,650 --> 00:17:09,970 Antonio lures the Welsh family with promises of an 8 % return. 237 00:17:10,810 --> 00:17:12,750 But Terry still has questions. 238 00:17:13,740 --> 00:17:19,160 He sends Tony a document asking him to confirm a number of promises he's made 239 00:17:19,160 --> 00:17:21,380 about BBC equities. 240 00:17:21,780 --> 00:17:26,200 It says, please fax back confirmation that the following statements regarding 241 00:17:26,200 --> 00:17:32,680 BBC equities are accurate. First, in 2007, BBC equities earned 242 00:17:32,680 --> 00:17:36,520 net distributable profits exceeding $50 million. 243 00:17:37,240 --> 00:17:41,600 Tony even noted there, says not exact, but close. 244 00:17:42,540 --> 00:17:49,040 In 2007, BBC Equities LLC purchased real estate exceeding $500 million 245 00:17:49,040 --> 00:17:50,900 in value. 246 00:17:51,280 --> 00:17:54,900 That figure was something Tony gave me previously. 247 00:17:55,320 --> 00:17:59,060 And he said on here, he says, not exact, but close. 248 00:17:59,960 --> 00:18:05,760 Let's go back to this. After receiving this signed assurance, Welsh and his 249 00:18:05,760 --> 00:18:11,220 clean out their IRAs and invest $41 ,000 in late June 2008. 250 00:18:14,160 --> 00:18:18,480 By this point, Bravada has brought in nearly $25 million. 251 00:18:20,860 --> 00:18:27,580 Many of his employees buy into BBC equities, including pitchman Jeff 252 00:18:27,580 --> 00:18:30,680 marketing coordinator Terry Makowski. 253 00:18:31,960 --> 00:18:35,760 I was excited about it. I'm like, wow, this is a really great opportunity. 254 00:18:36,440 --> 00:18:39,580 And I was really hopeful. I gave him the benefit of the doubt. 255 00:18:41,400 --> 00:18:42,400 Coming up. 256 00:18:42,730 --> 00:18:46,650 The truth behind BBC equities begins to emerge. 257 00:18:47,490 --> 00:18:51,290 If you say you're going to do something with investors' money, you better do it. 258 00:18:51,410 --> 00:18:54,610 If you say you're going to do one thing and do another, that's wrong. 259 00:19:08,080 --> 00:19:13,900 All across Michigan, investors in BBC Equities are thrilled to see their money 260 00:19:13,900 --> 00:19:14,900 grow. 261 00:19:15,120 --> 00:19:20,240 There were a lot of investors who told us and who testified that they were so 262 00:19:20,240 --> 00:19:23,980 delighted with BBC Equities that they told their friends and their friends 263 00:19:23,980 --> 00:19:24,980 an investment. 264 00:19:25,980 --> 00:19:31,520 Investors have been led to believe that their interest is generated by Bravada's 265 00:19:31,520 --> 00:19:32,520 real estate empire. 266 00:19:33,200 --> 00:19:35,300 But this is hardly the case. 267 00:19:36,209 --> 00:19:41,350 BBC's real estate empire, in truth, was a couple of dozen homes and some 268 00:19:41,350 --> 00:19:43,590 dilapidated car washes, mostly in Ohio. 269 00:19:46,690 --> 00:19:49,910 How then does Bravada keep sending out checks? 270 00:19:50,890 --> 00:19:56,550 While making big promises, he offers investors that thinly veiled warning. 271 00:19:57,570 --> 00:19:59,730 I don't want you to believe anything that I say. 272 00:20:00,370 --> 00:20:03,130 What you must do is say, prove it to me. 273 00:20:04,910 --> 00:20:10,330 Buried deep inside investor paperwork that some people receive is an 274 00:20:11,890 --> 00:20:17,790 BBC Equities is using investors' funds to make payments to other investors, not 275 00:20:17,790 --> 00:20:20,910 storing it safely at Comerica Bank, as he promised. 276 00:20:22,210 --> 00:20:25,730 And that is hardly Bravada's only lie. 277 00:20:26,710 --> 00:20:32,270 John Bravada was not in the DEA. He was never a federal agent. 278 00:20:33,320 --> 00:20:37,580 He was a public safety officer at the Kalamazoo Police Department for a little 279 00:20:37,580 --> 00:20:42,920 over a year, and he was fired from that job when they found that he had lied on 280 00:20:42,920 --> 00:20:43,920 his initial application. 281 00:20:44,760 --> 00:20:48,520 His lies don't stop there. 282 00:20:49,220 --> 00:20:52,920 Throughout the scheme, Rabada has made a simple promise. 283 00:20:54,380 --> 00:20:57,080 So the first thing is that our fund is set up a little different. We don't 284 00:20:57,080 --> 00:20:59,820 charge fees to our investors. I think we're the only fund that I know of that 285 00:20:59,820 --> 00:21:02,920 doesn't do that. We have a philosophy that says if we don't make money, you 286 00:21:02,920 --> 00:21:06,140 don't make money. So we have to make money for our investors in order to make 287 00:21:06,140 --> 00:21:07,140 that happen. 288 00:21:08,000 --> 00:21:13,280 In truth, however, Rabada pays millions in sales commissions and finder's fees 289 00:21:13,280 --> 00:21:19,540 to his employees, who jokingly refer to BBC Equities as the Billionaire Boys 290 00:21:19,540 --> 00:21:20,540 Club. 291 00:21:20,840 --> 00:21:27,080 One of these salesmen, Bravado's son, Antonio, shows off his newfound wealth 292 00:21:27,080 --> 00:21:28,700 this not -so -subtle video. 293 00:21:31,660 --> 00:21:34,780 Not bad for a fresh -faced youngster. 294 00:21:35,780 --> 00:21:40,580 And Antonio is not even the guy at the top of BBC equities. 295 00:21:41,640 --> 00:21:45,840 John Bravado was the first person to belly up to the trough. He was getting 296 00:21:45,840 --> 00:21:47,120 before anybody else. 297 00:21:47,530 --> 00:21:52,530 and getting paid a lot right from the get -go. In 2007, he decided he should 298 00:21:52,530 --> 00:21:54,890 start collecting a salary of $1 .2 million. 299 00:21:56,190 --> 00:21:59,870 Now, understand, BBC Equities was never profitable. 300 00:22:00,070 --> 00:22:02,730 Not in 2007, not in 2008, never. 301 00:22:04,410 --> 00:22:09,890 Over the years, Bravada pockets more than $7 million worth of investor funds 302 00:22:09,890 --> 00:22:11,750 he's promised to keep safe. 303 00:22:13,410 --> 00:22:16,550 The money that he told people he would protect, he was spending. 304 00:22:17,160 --> 00:22:22,240 on himself to finance his lifestyle and to project an image of success so that 305 00:22:22,240 --> 00:22:23,800 he could get more investment dollars. 306 00:22:24,820 --> 00:22:31,120 Days after bringing in his first investors, Rabada shells out $90 ,000 307 00:22:31,120 --> 00:22:32,120 Ferrari. 308 00:22:32,540 --> 00:22:36,720 Later, he buys an $85 ,000 Maserati for his wife. 309 00:22:37,280 --> 00:22:43,040 And statements from his black Amex card are a catalog of greed gone wild. 310 00:22:43,680 --> 00:22:49,060 Featuring enormous charges at the finest establishments for food, clothes, 311 00:22:49,600 --> 00:22:54,220 cruises, travel, and anti -aging treatments. 312 00:22:56,240 --> 00:23:02,100 According to employee Terry Makowski, Bravada is not shy about sharing his 313 00:23:02,100 --> 00:23:03,100 spending habits. 314 00:23:04,400 --> 00:23:10,240 He was driving his Ferrari in the summertime and driving his Cadillac 315 00:23:10,240 --> 00:23:16,460 in the winter and, you know, talked very freely about, you know, oh, I have $500 316 00:23:16,460 --> 00:23:22,960 shoes and, you know, a $1 ,000 shirt and a $3 ,000 suit, and I went on a $25 317 00:23:22,960 --> 00:23:27,940 ,000 hunting trip. I mean, he dropped price tags on everything. 318 00:23:29,840 --> 00:23:34,320 Bravada lives in an impressive $1 .2 million home. 319 00:23:34,620 --> 00:23:36,400 But it's not enough. 320 00:23:36,700 --> 00:23:42,400 He begins building a 22 ,000 square foot lakefront mansion. 321 00:23:43,140 --> 00:23:48,560 Though it's never completed, an architect's animation shows that Bravada 322 00:23:48,560 --> 00:23:53,980 planning a palace of greed built on the backs of his hardworking investors. 323 00:23:56,140 --> 00:24:02,790 In a call to American greed, Bravada insists there's nothing wrong with any 324 00:24:02,790 --> 00:24:06,250 this. I was worth a lot of money before I started this company. 325 00:24:06,490 --> 00:24:09,910 So prior to me starting this company, I lived in a million -dollar house. I 326 00:24:09,910 --> 00:24:10,910 drove a Ferrari. 327 00:24:11,150 --> 00:24:16,570 I had a vacation home in Naples, Florida with an $8 million home before I 328 00:24:16,570 --> 00:24:17,570 started this company. 329 00:24:17,910 --> 00:24:23,610 So the fact that in 2009 I'm going to now build a new home and have a new 330 00:24:23,690 --> 00:24:24,870 it was my money. 331 00:24:25,260 --> 00:24:28,620 So I had a right to buy a house that I want to buy or a car that I want to buy. 332 00:24:28,620 --> 00:24:29,940 It didn't come from investors' money. 333 00:24:31,560 --> 00:24:36,460 But court records show Bravado was nearly broke when he started BBC 334 00:24:36,760 --> 00:24:43,080 And then almost all the money he brought in from 2006 to 2009 came from his 335 00:24:43,080 --> 00:24:44,080 investors. 336 00:24:44,960 --> 00:24:51,520 Up next, the economy takes a tumble and Bravado's real estate empire 337 00:24:51,520 --> 00:24:53,120 comes crashing down. 338 00:24:54,190 --> 00:24:58,570 He wanted to live that high life, and he just got carried away. He thought he'd 339 00:24:58,570 --> 00:25:02,570 hit an artesian wall of money, and when it ran dry, he was in deep trouble. 340 00:25:13,070 --> 00:25:19,750 While promising safety, John Bravada has paid himself millions 341 00:25:19,750 --> 00:25:23,210 and frittered away millions more on... 342 00:25:23,520 --> 00:25:27,500 Properties that include several shabby car washes and parking lots. 343 00:25:27,840 --> 00:25:33,320 In August 2008, he hires a real estate consultant to help refinance some of 344 00:25:33,320 --> 00:25:34,320 these investments. 345 00:25:34,980 --> 00:25:40,820 After taking a close look at Bravada's so -called empire, this expert hits him 346 00:25:40,820 --> 00:25:42,440 with a hard dose of reality. 347 00:25:43,260 --> 00:25:46,780 This portfolio is hemorrhaging money. 348 00:25:47,420 --> 00:25:49,300 All of these properties are underwater. 349 00:25:49,620 --> 00:25:53,560 You might as well just mail the keys back to the bank. They are worthless. 350 00:25:53,780 --> 00:25:55,020 They're less than worthless. 351 00:25:57,260 --> 00:26:02,460 John Bravada looked at the consultants and said, this is a bad report. We're 352 00:26:02,460 --> 00:26:03,460 screwed. 353 00:26:05,020 --> 00:26:07,400 And things are only getting worse. 354 00:26:08,300 --> 00:26:13,120 We begin our coverage tonight of what's been called the worst financial crisis 355 00:26:13,120 --> 00:26:14,480 in modern times. 356 00:26:14,820 --> 00:26:21,400 As the world economy goes into freefall in September 2008, John Bravada needs to 357 00:26:21,400 --> 00:26:24,920 keep nervous investors from asking for their money back. 358 00:26:25,800 --> 00:26:28,980 August of 2008, Bravada is given this report. 359 00:26:29,200 --> 00:26:32,600 It says the property portfolio is worthless. 360 00:26:32,880 --> 00:26:37,600 What does he do? He sends out a letter to all of his investors. 361 00:26:37,950 --> 00:26:40,270 in September of 2008, one month later. 362 00:26:40,770 --> 00:26:44,530 And he writes, there might be a crisis on Wall Street, but there's no crisis at 363 00:26:44,530 --> 00:26:45,530 BBC Equities. 364 00:26:45,890 --> 00:26:50,630 He says, we are sitting on cash, and our portfolio position is strong. 365 00:26:51,530 --> 00:26:52,670 None of that was true. 366 00:26:55,030 --> 00:26:59,410 Bravada needs to do more than just tell his investors everything is okay. 367 00:27:00,090 --> 00:27:04,530 He needs to bring in new investors so he can keep paying out interest. 368 00:27:05,230 --> 00:27:09,540 To do this, He tweaks his pitch to fit the times. 369 00:27:10,360 --> 00:27:13,740 In the Depression, the richest people that came out of the Depression were 370 00:27:13,740 --> 00:27:14,740 that bought real estate. 371 00:27:14,800 --> 00:27:15,960 It'll be the same today. 372 00:27:16,720 --> 00:27:18,540 So how do you participate in it? 373 00:27:19,600 --> 00:27:23,940 His answer, of course, is by investing with DBC Equities. 374 00:27:25,240 --> 00:27:27,740 It's an outstanding opportunity to buy real estate today. 375 00:27:28,060 --> 00:27:31,360 Outstanding opportunity to buy real estate today. The greatest wealth 376 00:27:31,360 --> 00:27:34,860 in our history is taking place today. The problem is most people in this room 377 00:27:34,860 --> 00:27:35,860 out there in the public. 378 00:27:36,090 --> 00:27:38,790 don't know about it, or don't know how to take advantage of it. 379 00:27:39,810 --> 00:27:45,910 While rejiggering what he says, Bravada also embarks on a new marketing blitz to 380 00:27:45,910 --> 00:27:50,410 carry his message out of local restaurants to a nationwide audience. 381 00:27:51,790 --> 00:27:55,610 I'm Tiffany Tift reporting for America's premier experts. Today we are in 382 00:27:55,610 --> 00:28:01,270 Orlando for a very special event. We are honoring America's top 20 experts, and 383 00:28:01,270 --> 00:28:04,810 today we have with us John Bravada, who is an expert in financial services. 384 00:28:05,170 --> 00:28:08,770 How are you doing today? Thank you very much. Thanks for having us. So you guys 385 00:28:08,770 --> 00:28:14,510 kind of do a lot of everything, right? It may seem like Bravada is being asked 386 00:28:14,510 --> 00:28:17,730 about his company by a top -notch journalist. 387 00:28:18,520 --> 00:28:23,660 But this is actually one of two new paid ads Bravada uses to sing the same old 388 00:28:23,660 --> 00:28:28,000 song. We get to put our philosophy to our investors. And the philosophy is 389 00:28:28,000 --> 00:28:32,200 it's safety first of your principal. Never put the principal at risk. And 390 00:28:32,200 --> 00:28:35,040 it's get the highest rate of return that we can get on it. Now, how we do that 391 00:28:35,040 --> 00:28:39,540 is this. At BBC Equities, we secure your principal dollars. That is unheard of 392 00:28:39,540 --> 00:28:40,780 in the marketplace today. 393 00:28:41,720 --> 00:28:44,420 Bravada also pays to appear in Forbes magazine. 394 00:28:45,210 --> 00:28:50,050 where he's pictured on a private jet and claims his net worth may soon exceed 395 00:28:50,050 --> 00:28:52,550 $250 million. 396 00:28:53,470 --> 00:28:59,910 He presented those to investors as these media outlets choosing him because of 397 00:28:59,910 --> 00:29:04,090 his success and profiling him because of what he's achieved, when in fact they 398 00:29:04,090 --> 00:29:07,630 were paid for by Bravada using investor dollars. 399 00:29:08,590 --> 00:29:12,430 And this isn't Bravada's last piece of self -promotion. 400 00:29:13,210 --> 00:29:18,810 The man who once told investors not to trust him uses $25 ,000 of their dollars 401 00:29:18,810 --> 00:29:20,350 to hire a ghostwriter. 402 00:29:20,870 --> 00:29:26,230 In return, he gets his name on a book that once again seems like a warning. 403 00:29:26,570 --> 00:29:30,070 It's titled The Stealing of Wealth in America. 404 00:29:34,230 --> 00:29:40,110 By 2009, John Bravada has stolen enough wealth To move from his old office 405 00:29:40,110 --> 00:29:44,230 building to the 17th floor of a shining golden tower. 406 00:29:45,530 --> 00:29:48,290 But the fun can't last forever. 407 00:29:49,070 --> 00:29:54,290 By mid -2009, BBC Equities was in a death spiral. 408 00:29:54,570 --> 00:30:01,510 It had $128 million of debt obligations on its real estate. It had 409 00:30:01,510 --> 00:30:04,810 $45 million of investor obligations. 410 00:30:05,010 --> 00:30:06,550 And on top of that... 411 00:30:06,750 --> 00:30:13,650 it needed to find a way to pay 10 % to 12 % guaranteed interest annually 412 00:30:13,650 --> 00:30:14,670 to its investors. 413 00:30:16,570 --> 00:30:19,630 It was too much, and the money was drying up. 414 00:30:21,930 --> 00:30:27,250 In March 2009, the state of Michigan ordered BBC Equities to cease 415 00:30:28,590 --> 00:30:33,510 And before long, the U .S. Securities and Exchange Commission begins looking 416 00:30:33,510 --> 00:30:35,390 into Bravado's company as well. 417 00:30:36,120 --> 00:30:42,820 We had heard a report that an investor had tried to get out her $300 ,000 418 00:30:42,820 --> 00:30:48,120 -plus investment in 2009, and no one was getting back to her, and she was 419 00:30:48,120 --> 00:30:49,600 becoming increasingly concerned. 420 00:30:50,140 --> 00:30:56,240 Based on that, the SEC began an investigation into the finances of BBC 421 00:30:57,400 --> 00:31:00,600 But Bravada isn't about to throw in the towel. 422 00:31:02,640 --> 00:31:03,640 Coming up. 423 00:31:04,010 --> 00:31:10,190 As BBC equities crumbles, John Bravada continues to tell investors the same old 424 00:31:10,190 --> 00:31:16,890 lies. I am a big believer that real estate today, there's been no better 425 00:31:16,890 --> 00:31:21,150 invest than today. The greatest wealth transfer in history has taken place 426 00:31:21,150 --> 00:31:23,630 before our eyes, and it's happening in the real estate industry. 427 00:31:25,150 --> 00:31:27,690 Would you fall for John Bravada's lies? 428 00:31:28,150 --> 00:31:32,870 Take a closer look at his pitch at AmericanGreed .CNBC .com. 429 00:31:35,080 --> 00:31:37,000 Want inside information from the show? 430 00:31:37,260 --> 00:31:39,580 Join the Greed social network. 431 00:31:40,020 --> 00:31:42,280 Like us on American Greed's Facebook page. 432 00:31:42,740 --> 00:31:43,920 We'll be right back. 433 00:31:52,840 --> 00:31:59,720 By June 2009, it's becoming increasingly clear that something is very wrong at 434 00:31:59,720 --> 00:32:01,160 BBC Equities. 435 00:32:02,520 --> 00:32:08,000 Despite his current problems, the guy in charge is hardly slowing down. 436 00:32:08,780 --> 00:32:14,160 John Bravado hastily convened conference calls where he doubled down on the lies 437 00:32:14,160 --> 00:32:15,620 and said everything is going great. 438 00:32:15,980 --> 00:32:21,520 I am a big believer that real estate today, there's been no better time to 439 00:32:21,520 --> 00:32:22,520 invest than today. 440 00:32:22,940 --> 00:32:27,220 We have a bunch of new irons in the fire. We're actually going to be 441 00:32:27,220 --> 00:32:29,680 out into new and fantastic opportunities. 442 00:32:30,520 --> 00:32:35,160 The benefit of you investing in a company like ours is that you have other 443 00:32:35,160 --> 00:32:39,020 people and experts that are finding opportunities like this to help invest 444 00:32:39,020 --> 00:32:41,500 dollars in areas that you may not even think of. 445 00:32:41,960 --> 00:32:45,160 Stay with us. Things are going to be fantastic. They're going to get even 446 00:32:45,160 --> 00:32:46,160 better. 447 00:32:47,100 --> 00:32:53,180 Bravada launches a new fund called Phoenix Venture Capital, a name that 448 00:32:53,180 --> 00:32:57,080 be one more admission of what Bravada is really up to. 449 00:32:58,180 --> 00:33:03,900 It's ironic, again, because the image of a phoenix is a bird emerging from the 450 00:33:03,900 --> 00:33:08,580 ashes, right? Well, that was very apt. The ashes were BBC equities. 451 00:33:09,000 --> 00:33:13,540 And he decided phoenix, the story behind phoenix was going to keep them 452 00:33:13,540 --> 00:33:17,100 interested and more importantly, keep them from trying to redeem their money 453 00:33:17,100 --> 00:33:20,200 because BBC equities didn't have enough to give back to investors. 454 00:33:22,020 --> 00:33:27,720 Terry Welsh is one of those people who doesn't yet know that all his family's 455 00:33:27,720 --> 00:33:28,720 money is gone. 456 00:33:29,480 --> 00:33:34,680 He hears about Phoenix from Antonio Bravado in the summer of 2009. 457 00:33:35,500 --> 00:33:41,360 He said that this was an opportunity to take the money that was in the original 458 00:33:41,360 --> 00:33:42,940 BBC Equities account. 459 00:33:43,800 --> 00:33:47,260 put it into an account where they would be doing similar things but take 460 00:33:47,260 --> 00:33:54,140 advantage of what they expected to be as a public offering, and 461 00:33:54,140 --> 00:34:00,160 that those funds hopefully would go through a literal doubling in their 462 00:34:00,160 --> 00:34:02,720 in the process of going public. 463 00:34:04,060 --> 00:34:06,560 But there will be no IPO. 464 00:34:08,300 --> 00:34:13,800 In July, the SEC obtains a court order shutting down Rivada and BBC Equities. 465 00:34:14,860 --> 00:34:21,500 The company has now raised more than $50 million, but investigators find there's 466 00:34:21,500 --> 00:34:22,940 almost nothing left. 467 00:34:23,679 --> 00:34:29,139 In late July 2009, the SEC went into court to shut down BBC Equities. 468 00:34:29,639 --> 00:34:35,000 We took a look at BBC Equities' books and records, and what did they have in 469 00:34:35,000 --> 00:34:37,000 bank? $22 ,000. 470 00:34:38,960 --> 00:34:43,719 The SEC's civil lawsuit isn't the only heat Bravada is feeling. 471 00:34:44,020 --> 00:34:46,380 So creating wealth and preserving assets. 472 00:34:47,040 --> 00:34:49,260 What's John trying to get at with that? 473 00:34:50,000 --> 00:34:52,940 Soon, a criminal investigation gets underway. 474 00:34:53,620 --> 00:34:59,900 Led at first by FBI agent Eric Newberg and later by agent Kelly Cease. This 475 00:34:59,900 --> 00:35:04,860 website right here talks about... Before long, the feds have an ace up their 476 00:35:04,860 --> 00:35:05,860 sleeve. 477 00:35:06,640 --> 00:35:11,720 Realizing he could be headed to prison, Bravada's young partner, R .J. Trabulsi, 478 00:35:11,840 --> 00:35:16,660 begins working with the FBI, recording phone conversations with his boss. 479 00:35:18,660 --> 00:35:25,000 In one of these calls, Bravada reveals that he may have found a way out of his 480 00:35:25,000 --> 00:35:26,000 current troubles. 481 00:35:27,500 --> 00:35:32,400 Mail fraud and wire fraud, if those are the charges, don't even carry criminal 482 00:35:32,400 --> 00:35:34,360 jail time in Italy. 483 00:35:35,040 --> 00:35:39,340 There's never been a case in Italy that they can find where Italy actually 484 00:35:39,340 --> 00:35:43,620 allowed an extradition in a case that's greater punishment than their own. 485 00:35:44,940 --> 00:35:47,560 Bravada isn't just talking, though. 486 00:35:49,140 --> 00:35:54,620 In February 2011, he purchases a ticket to head to Milan, Italy. 487 00:35:55,120 --> 00:36:00,100 When the feds get word of his plans, they act quickly to stop him. 488 00:36:00,940 --> 00:36:02,620 When we found out that... 489 00:36:02,970 --> 00:36:04,530 John Bravado was leaving for Italy. 490 00:36:05,090 --> 00:36:09,350 We wanted to make sure that he didn't leave the country because we were under 491 00:36:09,350 --> 00:36:11,230 the impression with him that he might not come back. 492 00:36:11,630 --> 00:36:15,410 So we did a complaint in order to get the arrest warrant. 493 00:36:15,970 --> 00:36:20,790 We planned to arrest him before he got on his flight, which was scheduled for a 494 00:36:20,790 --> 00:36:24,450 Tuesday, but he ended up leaving on a Sunday. 495 00:36:25,970 --> 00:36:30,070 All of a sudden, RJ called me and said, John's already left. 496 00:36:32,680 --> 00:36:33,780 Gosh darn it moment. 497 00:36:35,840 --> 00:36:40,640 In Milan, Bravada rents an apartment, starts applying to become an Italian 498 00:36:40,640 --> 00:36:44,580 citizen, opens a bank account, and gets to work. 499 00:36:45,240 --> 00:36:48,200 John Bravada thought he could start a new fund. 500 00:36:48,540 --> 00:36:53,120 I assume that it was going to be the same type of fund that he wanted to 501 00:36:53,120 --> 00:36:54,120 in the United States. 502 00:36:55,500 --> 00:36:59,540 Bravada will later say he was just there on a business trip. 503 00:37:00,140 --> 00:37:03,480 and had no real intention of moving overseas. 504 00:37:04,000 --> 00:37:05,840 The feds don't buy it. 505 00:37:07,080 --> 00:37:11,660 I don't believe that. I think that he was probably planning to stay in Italy. 506 00:37:12,700 --> 00:37:19,000 I don't know that for sure, but he certainly took a lot of steps for just 507 00:37:19,000 --> 00:37:20,000 on a business trip. 508 00:37:21,060 --> 00:37:27,520 Whatever his true plans are, Robada's visa expires, and he flies back to the U 509 00:37:27,520 --> 00:37:29,080 .S. in May 2011. 510 00:37:30,210 --> 00:37:34,590 Traveling on a round -trip ticket, he plans to return to Italy in less than 511 00:37:34,590 --> 00:37:40,730 months. But when he lands in New York, he discovers that's not happening. 512 00:37:41,310 --> 00:37:45,750 I was not present during the arrest, but I can only imagine that he did not 513 00:37:45,750 --> 00:37:47,390 expect that when he got off the airplane. 514 00:37:48,230 --> 00:37:53,530 I think John had a hard time coming to terms with it, and I think John thought 515 00:37:53,530 --> 00:37:56,470 that he was untouchable and he wouldn't be held accountable. 516 00:37:57,210 --> 00:38:00,870 that he could get back into the U .S. and get back out with nobody knowing. 517 00:38:02,650 --> 00:38:06,890 Coming up, John Bravada remains unrepentant. 518 00:38:07,390 --> 00:38:11,130 That's hard to say what goes on inside John Bravada's mind. 519 00:38:11,670 --> 00:38:14,910 And victims struggle to pick up the pieces. 520 00:38:15,870 --> 00:38:16,870 We were hurt. 521 00:38:17,090 --> 00:38:18,090 We were hurt. 522 00:38:18,530 --> 00:38:19,770 We were hurt by this. 523 00:38:32,340 --> 00:38:38,560 Despite the fact that John Bravada's many lies are caught on tape, he and his 524 00:38:38,560 --> 00:38:42,480 son Antonio decide to go to trial in 2013. 525 00:38:43,400 --> 00:38:48,580 I think John Bravada decided to go to trial because he thinks he is larger 526 00:38:48,580 --> 00:38:55,080 life, thought he could come to trial, take the stand, testify in front of the 527 00:38:55,080 --> 00:38:59,040 jury and convince them of his lies, much like he convinced his investors. 528 00:39:00,270 --> 00:39:05,730 At the end of an eight -week trial, Bravada testifies in his own defense for 529 00:39:05,730 --> 00:39:06,730 four days. 530 00:39:07,390 --> 00:39:12,070 From the outset, though, he gives the jury exactly what he's given his 531 00:39:12,070 --> 00:39:16,090 investors. He lied within the first minute of taking the stand. 532 00:39:16,930 --> 00:39:20,850 He had claimed to graduate from Grand Valley State University with an 533 00:39:20,850 --> 00:39:24,190 associate's degree, and it turns out that Grand Valley State is a four -year 534 00:39:24,190 --> 00:39:26,150 college and doesn't have associate's degrees. 535 00:39:26,630 --> 00:39:27,630 Like? 536 00:39:27,870 --> 00:39:31,510 He did when he was pitching prospective investors. 537 00:39:31,930 --> 00:39:38,410 He did not let the truth stand in the way of a compelling narrative. 538 00:39:39,950 --> 00:39:43,630 But angry investors offered a more compelling narrative. 539 00:39:44,590 --> 00:39:51,390 The jury finds John Bravada guilty on 14 counts of wire fraud and one count of 540 00:39:51,390 --> 00:39:54,850 conspiracy. He gets 20 years in prison. 541 00:39:56,330 --> 00:40:01,350 His son, Antonio, is convicted of conspiracy and gets five years. 542 00:40:02,670 --> 00:40:08,250 A key piece of evidence against him is the facts he sent to Terry Welch when he 543 00:40:08,250 --> 00:40:10,090 put his lies in writing. 544 00:40:10,950 --> 00:40:15,450 I think to some extent, Tony is a victim of his father. 545 00:40:16,130 --> 00:40:18,810 But Tony also jumped in with both feet. 546 00:40:19,830 --> 00:40:22,190 After cooperating with authorities... 547 00:40:22,590 --> 00:40:28,810 R .J. Trabose pleaded guilty to one count of wire fraud and received just 548 00:40:28,810 --> 00:40:30,070 four years in prison. 549 00:40:30,970 --> 00:40:35,370 During the course of his scam, John Bravado made a simple pitch. 550 00:40:35,890 --> 00:40:39,530 Get rich, but always keep your nest eggs safe. 551 00:40:40,590 --> 00:40:44,050 You see, I believe we never put our principle at risk because I can't go 552 00:40:44,050 --> 00:40:45,050 and make it up again. 553 00:40:45,470 --> 00:40:48,970 If I'm retired, how do I go back and make up 30 -40 % of the money that I 554 00:40:48,970 --> 00:40:52,810 lost, that I'm planning on living on, that I sat there and needed in my life? 555 00:40:52,870 --> 00:40:54,930 How do I go back and make that money up again? 556 00:40:55,290 --> 00:40:56,530 I can't go back to work. 557 00:40:58,210 --> 00:41:00,030 Well, don't lose it in the first place. 558 00:41:01,310 --> 00:41:07,950 In the end, over 400 investors gave more than $50 million to the man who 559 00:41:07,950 --> 00:41:11,230 promised them safety, then lived large. 560 00:41:15,450 --> 00:41:19,830 feel badly at all about people buying expensive cars and houses or anything 561 00:41:19,830 --> 00:41:26,170 as long as it's honest profit but this was theft it was theft 562 00:41:26,170 --> 00:41:33,170 and we were stolen from i can see at this point no way 563 00:41:33,170 --> 00:41:37,810 that my wife or i will ever be able to retire at all 564 00:41:37,810 --> 00:41:44,660 with typical bravado Authorities say Bravada has 565 00:41:44,660 --> 00:41:47,440 tried to start a new fund from behind bars. 566 00:41:48,300 --> 00:41:52,900 And in a call to American greed, Bravada says he's not to blame for the 567 00:41:52,900 --> 00:41:56,580 financial ruin left in the wake of the billionaire boys club. 568 00:41:57,240 --> 00:42:02,720 Instead, he points a finger at the salesman who pitched his product, the 569 00:42:02,720 --> 00:42:07,940 investors who misinterpreted his words, and the government who shut him down 570 00:42:07,940 --> 00:42:09,940 before he could hit it big.