1 00:00:00,360 --> 00:00:06,660 In this episode of American Greed, in Detroit's troubled public schools, 2 00:00:06,660 --> 00:00:09,860 gold in pencils, paper, and desks. 3 00:00:10,220 --> 00:00:15,760 Especially for people like Norman Shy, who know how to rig the system, 4 00:00:15,760 --> 00:00:20,980 millions. Norman Shy was living lavishly, even by the standards of most 5 00:00:20,980 --> 00:00:24,580 people. Swimming pools, a two -story library. 6 00:00:24,940 --> 00:00:28,060 Some irony there, a two -story library from a guy who... 7 00:00:28,410 --> 00:00:30,530 Steals from school kids who can't afford books. 8 00:00:30,930 --> 00:00:37,450 And later, in an online invasion, romance scammers are stealing millions 9 00:00:37,450 --> 00:00:41,870 dollars from unsuspecting Americans posing as U .S. soldiers. 10 00:00:42,510 --> 00:00:47,050 You would never expect somebody from the military to scam you. 11 00:00:47,470 --> 00:00:49,330 I thought we were going to get married. 12 00:00:50,050 --> 00:00:53,990 It's a perfect scam for the criminals. They prey on those emotions. 13 00:00:54,680 --> 00:00:58,420 They build the trust, and within a week, two weeks, they're asking for money. 14 00:00:58,940 --> 00:01:05,220 And then one victim turns the tables and cashes in on the scam for a lovely 15 00:01:05,220 --> 00:01:06,220 profit. 16 00:01:22,870 --> 00:01:29,750 In 2016, outside the Detroit Criminal Courthouse, the legal walk of shame 17 00:01:29,750 --> 00:01:32,250 has an unthinkable cast of characters. 18 00:01:35,150 --> 00:01:41,850 Not murderers or drug dealers, but public school officials charged 19 00:01:41,850 --> 00:01:45,470 with stealing funds that were supposed to go to students. 20 00:01:47,250 --> 00:01:51,670 Do you have any apology to give to anybody? I have nothing to say, thank 21 00:01:51,950 --> 00:01:56,930 After all this area has been through, after all the smacks to the head this 22 00:01:56,930 --> 00:02:01,670 has taken, and here's another. It's one of those things that make you think, did 23 00:02:01,670 --> 00:02:02,910 this have to be Detroit? 24 00:02:03,530 --> 00:02:07,590 Because it really does paint the whole area. It's like people roll their eyes. 25 00:02:07,690 --> 00:02:09,690 Oh, that's just Detroit again. 26 00:02:10,990 --> 00:02:13,190 It wasn't supposed to go this way. 27 00:02:14,030 --> 00:02:19,130 Just a short time ago, public school principals were seen as the last best 28 00:02:19,520 --> 00:02:21,080 to turn around Detroit schools. 29 00:02:21,980 --> 00:02:24,840 Some were even lauded on national television. 30 00:02:26,320 --> 00:02:30,080 There's an amazing school in Detroit that's getting national attention right 31 00:02:30,080 --> 00:02:32,360 at Spain Elementary School in Detroit. 32 00:02:32,660 --> 00:02:38,440 Spain Elementary's principal, Ron Alexander, goes on the Ellen DeGeneres 33 00:02:38,440 --> 00:02:40,420 tell the world of his school's plight. 34 00:02:41,480 --> 00:02:44,780 Holes in the ceiling let rain pour into the classrooms. 35 00:02:45,680 --> 00:02:47,640 Mold covers the gym floor. 36 00:02:48,970 --> 00:02:51,290 Alexander pleads to Ellen for help. 37 00:02:51,850 --> 00:02:54,170 And it pays off in a big way. 38 00:02:54,970 --> 00:02:55,970 Goodbye! 39 00:02:56,650 --> 00:02:58,550 Half a million dollars big. 40 00:02:59,570 --> 00:03:05,030 In collaboration with Lowe's, it's the largest gift her show has ever bestowed. 41 00:03:05,070 --> 00:03:06,750 I remember we interviewed him. 42 00:03:07,280 --> 00:03:11,780 When it happened, and I think he stood up and actually physically danced behind 43 00:03:11,780 --> 00:03:15,760 his desk because he was so happy. He couldn't believe that somebody would be 44 00:03:15,760 --> 00:03:18,820 that generous and help out his school, and it was a school that absolutely 45 00:03:18,820 --> 00:03:20,060 needed that money. 46 00:03:21,600 --> 00:03:27,420 Other principals throughout the Detroit public school system are seen as 47 00:03:27,420 --> 00:03:28,420 saviors. 48 00:03:33,760 --> 00:03:38,060 Principal Ronnie Sims attracts a film crew to document his groundbreaking 49 00:03:38,060 --> 00:03:42,360 program for fifth -grade boys called the Gentleman's Club. 50 00:03:42,660 --> 00:03:48,620 The Gentleman's Club, my definition would be a life -altering experience 51 00:03:48,620 --> 00:03:54,360 that would help the boys become respectful men 52 00:03:54,360 --> 00:03:57,240 in their family and community. 53 00:03:57,720 --> 00:03:58,720 Wake up, everybody. 54 00:03:59,560 --> 00:04:02,600 Principals are like the mothers and fathers to a lot of these kids. 55 00:04:03,130 --> 00:04:04,089 They got hugs. 56 00:04:04,090 --> 00:04:06,430 All the principals knew the kids by first name. 57 00:04:06,670 --> 00:04:10,930 So the kids trusted the principal. The parents trusted the principal. 58 00:04:11,670 --> 00:04:13,630 But money is always tight. 59 00:04:14,090 --> 00:04:17,649 And principals say they are painfully hamstrung. 60 00:04:17,970 --> 00:04:24,350 With the system that we have now, my hands are tied to many degrees as far as 61 00:04:24,350 --> 00:04:27,150 getting access to the funds. 62 00:04:27,950 --> 00:04:32,950 They would make requests for funds for supplies or programs or whatever they 63 00:04:32,950 --> 00:04:36,990 needed, and it would either not be there or it would fall on deaf ears. 64 00:04:38,550 --> 00:04:43,510 Despite appearances, Detroit public schools actually do have a billion 65 00:04:43,510 --> 00:04:46,810 budget serving more than 47 ,000 students. 66 00:04:47,650 --> 00:04:51,950 And a lot of that is federal money and state money, but what that tells you is 67 00:04:51,950 --> 00:04:54,230 that this is a district that does a lot of business. 68 00:04:54,910 --> 00:04:57,130 And I think people saw that. 69 00:04:57,740 --> 00:04:59,580 as an opportunity to make money. 70 00:05:02,820 --> 00:05:08,300 Norman Shai grows up in northwest Detroit and attends Detroit Public 71 00:05:08,860 --> 00:05:15,120 He's a local guy made good, founding a school supply company named Allstate 72 00:05:15,120 --> 00:05:16,120 Sales. 73 00:05:17,680 --> 00:05:21,060 The Detroit school system is one of Shai's biggest clients. 74 00:05:22,140 --> 00:05:26,200 He seemed generous, philanthropist, is what I could... 75 00:05:26,480 --> 00:05:27,560 Almost have called him. 76 00:05:28,040 --> 00:05:32,680 At one time, we gave him an award as one of the top 100 suppliers for the 77 00:05:32,680 --> 00:05:33,680 district. 78 00:05:34,680 --> 00:05:36,260 It's a lucrative business. 79 00:05:37,280 --> 00:05:42,320 And Shai makes a point to give back to the struggling school district that 80 00:05:42,320 --> 00:05:44,460 make him the success he is today. 81 00:05:45,340 --> 00:05:48,820 Norman Shai provided blinds to some schools. 82 00:05:49,960 --> 00:05:54,860 He sponsored field trips for students, furniture. 83 00:05:55,980 --> 00:06:00,280 and provided several school supplies that he claimed were free to the school. 84 00:06:01,240 --> 00:06:07,020 And then, in 2009, there's a big change that will alter the course of Norman 85 00:06:07,020 --> 00:06:11,020 Shai's life and the lives of several principals he deals with. 86 00:06:11,820 --> 00:06:16,720 The Michigan State Legislature installs an emergency manager who becomes 87 00:06:16,720 --> 00:06:20,420 responsible for all financial decisions in the district. 88 00:06:21,020 --> 00:06:23,900 The hope is this person will turn the ship around. 89 00:06:24,180 --> 00:06:28,220 In part, by decentralizing the vast bureaucracy. 90 00:06:28,880 --> 00:06:32,840 The building principals had to run daily business. They needed school supplies. 91 00:06:32,960 --> 00:06:33,939 They needed food. 92 00:06:33,940 --> 00:06:39,760 So what that meant was that the ability or the right to sign for invoices was 93 00:06:39,760 --> 00:06:42,160 now delegated to principals at the building level. 94 00:06:43,040 --> 00:06:47,820 Before, vendors were chosen by the district, but now each principal has the 95 00:06:47,820 --> 00:06:51,720 ability to choose their own vendors and find the best deals for Detroit Public 96 00:06:51,720 --> 00:06:53,320 Schools, or DPS. 97 00:06:54,090 --> 00:06:58,810 You had principals that were kings and queens on their own island, so to speak, 98 00:06:58,830 --> 00:07:04,410 and they could, through their own individual signature, sign off on the 99 00:07:04,410 --> 00:07:10,210 and expenditures of DPS money, again, tax dollars, for all sorts of 100 00:07:10,210 --> 00:07:13,590 materials, and the vendors would provide those materials. 101 00:07:14,830 --> 00:07:19,290 With Norman Shye's history of working with the district, principals naturally 102 00:07:19,290 --> 00:07:22,130 choose him for many of their supply needs. 103 00:07:22,960 --> 00:07:27,260 He would go out to the schools, meet with the principals, sit with them and 104 00:07:27,260 --> 00:07:31,820 allow them to look through the catalog and make the orders with him. 105 00:07:32,160 --> 00:07:34,680 He delivered his orders in person. 106 00:07:35,800 --> 00:07:40,780 His business spread like wildfire by word of mouth. Some principals that 107 00:07:40,780 --> 00:07:46,040 with him told other principals about him, you know, so he reached out. 108 00:07:47,400 --> 00:07:51,020 Shai also offers a product his competitors do not. 109 00:07:51,400 --> 00:07:54,760 a specialty item called raised line paper. 110 00:07:56,420 --> 00:08:02,860 It has a braille -like texture and supposedly helps special needs students 111 00:08:02,860 --> 00:08:03,860 to write. 112 00:08:05,480 --> 00:08:10,560 Raised line paper is an unlikely springboard into a multi -million dollar 113 00:08:11,640 --> 00:08:15,720 But give Norman Shy an A -plus for creativity. 114 00:08:18,220 --> 00:08:24,760 Next on American Greed, see how Norman Shy is making paper and turning it into 115 00:08:24,760 --> 00:08:27,100 cold, hard, fraudulent cash. 116 00:08:41,080 --> 00:08:46,320 In Detroit, principals have been given wide latitude to run their public 117 00:08:46,320 --> 00:08:47,360 like a business. 118 00:08:47,910 --> 00:08:52,390 In theory, it reduces bureaucracy and increases accountability. 119 00:08:53,010 --> 00:08:56,890 But in practice, it makes the schools ripe for fraud. 120 00:08:57,590 --> 00:09:02,290 It really goes to show how weak the financial controls were because the 121 00:09:02,290 --> 00:09:03,910 principals could sign off on anything. 122 00:09:04,190 --> 00:09:07,830 And it was expected that they would be truthful and do the right thing. 123 00:09:08,850 --> 00:09:13,270 Norman Shy comes up with a plan to take advantage of the principal's new 124 00:09:13,270 --> 00:09:14,270 authority. 125 00:09:15,560 --> 00:09:21,360 He submits inflated invoices, billing schools for far more than he actually 126 00:09:21,360 --> 00:09:25,620 delivers. The school principals become his partners in crime. 127 00:09:26,580 --> 00:09:30,340 I mean, the whole scheme worked like this. You know, I'll pat your back, you 128 00:09:30,340 --> 00:09:35,500 mine. How about I order $10 ,000 worth of paper, I'm only going to deliver 129 00:09:35,500 --> 00:09:38,380 eight, and then you and I will split the difference. 130 00:09:39,160 --> 00:09:43,220 It was a simple, you know, turn your head the other way when stuff doesn't 131 00:09:43,220 --> 00:09:44,920 up. That was the key to it all. 132 00:09:45,610 --> 00:09:50,170 Shai's raised -line paper is the ideal vehicle for his fraud. 133 00:09:50,930 --> 00:09:56,470 It's consumed quickly and constantly refreshed, making audits more 134 00:09:57,070 --> 00:10:02,790 And when he submits bills, Shai is strategically vague about how much he 135 00:10:02,790 --> 00:10:03,790 delivered. 136 00:10:03,990 --> 00:10:05,710 There's no reflection of size. 137 00:10:06,730 --> 00:10:10,390 Quantity of 40, we don't know what a quantity of 40 is. Like, is it a REMA 138 00:10:10,390 --> 00:10:14,810 paper? Is it a stack of 12 pages? You know, so I think without necessarily 139 00:10:14,810 --> 00:10:19,230 seeing the goods, someone wouldn't necessarily know, have a concept of what 140 00:10:19,230 --> 00:10:20,630 being or should be delivered. 141 00:10:23,370 --> 00:10:28,430 Shai's bogus invoices siphon money from the district and divert it into the 142 00:10:28,430 --> 00:10:30,670 conspirators' personal bank accounts. 143 00:10:33,420 --> 00:10:38,560 Once the principal's ordered from Norman Shy, he kept detailed records, a 144 00:10:38,560 --> 00:10:44,720 meticulously kept ledger of the amount of money that he was paid by DPS, and he 145 00:10:44,720 --> 00:10:47,340 would give a percentage to each principal. 146 00:10:49,040 --> 00:10:54,660 Shy's kickbacks to the principals are generous, some as high as 40 to 60 147 00:10:54,660 --> 00:10:59,900 percent. They would call Norman Shy and say, hey, Norm, what's my balance? 148 00:11:00,100 --> 00:11:02,480 And he would tell them, your balance is $5 ,000. 149 00:11:03,240 --> 00:11:04,099 What do you need? 150 00:11:04,100 --> 00:11:08,140 And they would say, I'd like free $500 gift cards. 151 00:11:09,280 --> 00:11:14,120 Sometimes, instead of gift cards, the principals request cash or even 152 00:11:14,120 --> 00:11:15,720 improvements on their homes. 153 00:11:16,420 --> 00:11:23,180 To me, as bad as Norman Shy was, the principals were almost worse because 154 00:11:23,180 --> 00:11:27,120 they're the ones who had to look these kids in the eye every day. 155 00:11:27,920 --> 00:11:31,900 These little kids who are looking up to their role models, saying, gosh, maybe 156 00:11:31,900 --> 00:11:33,640 that's what I want to be when I grow up. 157 00:11:34,000 --> 00:11:38,500 And the principal is staring them right in the eye and taking payoffs. 158 00:11:39,360 --> 00:11:44,660 To keep things legitimate, Shai asks principals to request gift cards on 159 00:11:44,660 --> 00:11:47,320 official school letterhead for tax purposes. 160 00:11:49,260 --> 00:11:53,800 He plans to write off the cards as gifts or business expenses. 161 00:11:55,470 --> 00:11:59,090 Shai is brazenly doubling down on fraud. 162 00:12:00,610 --> 00:12:07,510 He was trying to legitimize kickbacks as business expenses, thereby reducing his 163 00:12:07,510 --> 00:12:11,010 tax doing only, which is tax evasion. 164 00:12:12,010 --> 00:12:17,970 With his scheme in place, he turns paper into profits and is able to enjoy a 165 00:12:17,970 --> 00:12:19,870 life of luxurious amenities. 166 00:12:21,040 --> 00:12:25,580 Until we went out to his house in Farmington Hills, I had no idea he was 167 00:12:25,580 --> 00:12:26,580 filthy rich. 168 00:12:27,860 --> 00:12:31,440 Every night, Norman Shy comes home to this. 169 00:12:33,320 --> 00:12:39,320 An 11 ,000 -square -foot mansion in Farmington Hills, equipped with nine 170 00:12:39,320 --> 00:12:44,620 bathrooms, four kitchens, and its very own movie theater. 171 00:12:48,090 --> 00:12:53,630 Millions of dollars intended for Detroit school children is instead poured into 172 00:12:53,630 --> 00:12:55,490 the house that Greed built. 173 00:12:56,730 --> 00:13:01,610 Norman Shy was living lavishly even by the standards of most wealthy people. 174 00:13:01,990 --> 00:13:04,470 Swimming pools, a two -story library. 175 00:13:04,850 --> 00:13:09,410 Some irony there, a two -story library from a guy who steals from school kids 176 00:13:09,410 --> 00:13:10,410 who can't afford books. 177 00:13:11,520 --> 00:13:17,160 Next on American Greed. Former Detroit school's principal accused by the feds 178 00:13:17,160 --> 00:13:21,860 taking tens of thousands of dollars in kickbacks. When a public school scandal 179 00:13:21,860 --> 00:13:25,800 hits the news, will it threaten to expose Norman Shy? 180 00:13:26,320 --> 00:13:29,500 They squeezed her and then she started singing like a bird. 181 00:13:29,720 --> 00:13:32,740 So we knew another shoe was going to drop. 182 00:13:44,720 --> 00:13:51,100 In 2015, a story breaks about an invoicing fraud involving another school 183 00:13:51,100 --> 00:13:52,520 district in Detroit. 184 00:13:52,900 --> 00:13:55,140 Her name, Kenyetta Wilburn Snap. 185 00:13:55,340 --> 00:13:59,640 The indictment today says Snap pulled in almost $60 ,000 in a bribery and 186 00:13:59,640 --> 00:14:00,640 kickback scheme. 187 00:14:01,000 --> 00:14:06,320 Somebody did an audit, and they found the discrepancy in the school supplies. 188 00:14:06,520 --> 00:14:08,680 And that's how the whole thing started coming down. 189 00:14:11,440 --> 00:14:16,500 We received information from an internal audit that a principal named Kenyetta 190 00:14:16,500 --> 00:14:21,660 Snap was possibly engaged in fraud with a vendor named Norman Shy. 191 00:14:23,960 --> 00:14:30,820 We conducted an interview, and Norman Shy very much admitted his involvement 192 00:14:30,820 --> 00:14:37,160 with Kenyetta Snap and alluded to additional business with the Detroit 193 00:14:37,160 --> 00:14:38,160 Schools. 194 00:14:39,530 --> 00:14:42,770 Investigators obtain a search warrant for Norman Shy's home. 195 00:14:43,550 --> 00:14:48,970 Inside, they find folders documenting 13 Detroit public schools he was doing 196 00:14:48,970 --> 00:14:49,970 business with. 197 00:14:51,130 --> 00:14:56,690 And inside each folder, invoices and handwritten ledgers laying out a running 198 00:14:56,690 --> 00:15:00,450 balance for each school official's personal account with Shy. 199 00:15:01,310 --> 00:15:05,730 And those files were really the motherlode. I mean, they were the 200 00:15:07,370 --> 00:15:08,950 Shy knows he's caught. 201 00:15:09,310 --> 00:15:13,850 He agrees to hand over voice and text messages from the principals he was 202 00:15:13,850 --> 00:15:15,050 working with to the FBI. 203 00:15:17,510 --> 00:15:22,970 Like this one from Josette Buendia, a principal at Bennett Elementary on 204 00:15:22,970 --> 00:15:24,670 Detroit's southwest side. 205 00:15:39,120 --> 00:15:42,980 Shy also agrees to wear a hidden camera while he meets with principals. 206 00:15:44,600 --> 00:15:47,960 In this video, he calls on Buendia at her office. 207 00:15:48,340 --> 00:15:53,760 She has been with the district for 16 years and the principal at Bennett since 208 00:15:53,760 --> 00:15:55,820 2010. Good morning. 209 00:15:56,060 --> 00:15:57,820 Norman Shy to see Ms. Buendia. 210 00:15:58,520 --> 00:15:59,520 Hey, 211 00:16:01,860 --> 00:16:04,880 Norm, how are you? Happy New Year to you. Happy New Year to you, too. 212 00:16:05,680 --> 00:16:06,680 Look. 213 00:16:07,770 --> 00:16:14,270 Being an elementary principal is like having 500 members of your own personal 214 00:16:14,270 --> 00:16:15,270 admiration society. 215 00:16:15,450 --> 00:16:17,190 Because they all think I'm wonderful. 216 00:16:17,570 --> 00:16:19,130 Well, tell me something. Aren't you wonderful? 217 00:16:19,370 --> 00:16:21,430 Oh, well, of course. Clearly. 218 00:16:22,290 --> 00:16:27,530 In this one meeting, Wendia takes $3 ,000 in gift cards. 219 00:16:27,890 --> 00:16:29,050 Here's your cards. Okay. 220 00:16:29,450 --> 00:16:34,530 It's just a portion of her prize for signing off on Shai's inflated invoices. 221 00:16:36,300 --> 00:16:40,500 Cheyenne Buendia may think that the gift cards are a clever way to launder 222 00:16:40,500 --> 00:16:47,180 money, but the cards leave an electronic trail that the FBI easily follows. 223 00:16:48,720 --> 00:16:55,020 We were able to learn that she made a number of personal expenditures. 224 00:16:55,260 --> 00:17:01,320 They ranged from gasoline purchases, fast food, massages. 225 00:17:01,780 --> 00:17:03,840 These expenditures were definitely... 226 00:17:04,410 --> 00:17:08,650 personal in nature and weren't for the school children of Bennett Elementary 227 00:17:08,650 --> 00:17:13,670 School. You were stealing from kids and you were reminded of it every time 228 00:17:13,670 --> 00:17:18,490 Norman Shy handed you another bundle of cash or gave you another stack of gift 229 00:17:18,490 --> 00:17:22,950 cards. Oh, hey, I was stealing from kids and it sure was profitable this 230 00:17:22,950 --> 00:17:23,950 quarter. 231 00:17:24,910 --> 00:17:27,329 Word starts to spread about the investigation. 232 00:17:28,460 --> 00:17:35,380 And on March 29, 2016, Norman Shai and 13 school officials are charged. 233 00:17:36,040 --> 00:17:40,520 We're here today to announce bribery charges that were filed this morning 234 00:17:40,520 --> 00:17:41,900 against 14 individuals. 235 00:17:42,140 --> 00:17:46,180 One of them is a vendor for Detroit Public Schools, and the other are all 236 00:17:46,180 --> 00:17:47,560 Detroit Public School officials. 237 00:17:48,880 --> 00:17:52,980 I was sitting in the news conference with the U .S. attorney. They hand you 238 00:17:52,980 --> 00:17:56,620 indictment, and it's got 13 principals whose names you don't recognize. 239 00:17:56,920 --> 00:17:59,220 But then I look at it again, and I go, wait a minute. 240 00:17:59,680 --> 00:18:01,600 That's Spain Elementary. 241 00:18:03,280 --> 00:18:09,520 Ronald Alexander, the very public hero of Spain Elementary, the man who appears 242 00:18:09,520 --> 00:18:16,460 on Ellen pleading for help, has been charged with stealing $23 ,000 from 243 00:18:16,460 --> 00:18:17,460 public schools. 244 00:18:18,350 --> 00:18:25,090 When he asked Ellen for money to fix up the school, at the same time, perhaps 245 00:18:25,090 --> 00:18:28,570 even the next day, he would see Norman Shy and he'd get his kickback or his 246 00:18:28,570 --> 00:18:29,570 bribe. 247 00:18:29,870 --> 00:18:34,650 Remember Ronnie Sims, the do -gooder who planned to turn boys into gentlemen? 248 00:18:35,110 --> 00:18:40,450 Sims is charged with taking almost $60 ,000 from his school and students. 249 00:18:40,730 --> 00:18:45,350 It makes Inspector General Bernadette Cucuzza and many others heartsick. 250 00:18:45,630 --> 00:18:47,410 I look at mainly our young boys. 251 00:18:48,060 --> 00:18:53,120 who look at a male principal and admire that principal and want to be him one 252 00:18:53,120 --> 00:18:54,120 day. 253 00:18:55,160 --> 00:19:02,060 And it just turns around, and the next thing is the same principal on TV as the 254 00:19:02,060 --> 00:19:03,140 fraudster, you know. 255 00:19:04,120 --> 00:19:09,080 But even in the face of the community's ire, some of the principals try to 256 00:19:09,080 --> 00:19:10,480 justify their expenses. 257 00:19:11,400 --> 00:19:13,960 Ms. Buendia told me that she spent a lot of money. 258 00:19:14,830 --> 00:19:20,150 on the schools out of her own pocket, and that she rationalized that it was 259 00:19:20,150 --> 00:19:22,810 to use these gift cards on herself because she was making herself even. 260 00:19:23,430 --> 00:19:28,510 What you have here are common criminals trying to justify to themselves and to 261 00:19:28,510 --> 00:19:30,950 the court that what they did was for the kids. 262 00:19:31,490 --> 00:19:36,290 The judge didn't buy it. I don't buy it. I don't think anybody bought it. You 263 00:19:36,290 --> 00:19:38,670 couldn't buy it, even with Norman Shye's gift cards. 264 00:19:41,670 --> 00:19:47,140 Despite the fraud and bribery allegations, Ellen and Lowe's decide to 265 00:19:47,140 --> 00:19:48,840 with their donation to Spain Elementary. 266 00:19:49,480 --> 00:19:54,360 In a statement to American Greed, Lowe's explains their decision in further 267 00:19:54,360 --> 00:19:59,880 detail, writing, There was still such great need at Spain Elementary School 268 00:19:59,880 --> 00:20:04,200 we kept our commitment to improve the learning environment for the students, 269 00:20:04,200 --> 00:20:09,160 insured funds provided by Lowe's directly benefited the students and 270 00:20:10,640 --> 00:20:12,000 With Norman Shy. 271 00:20:12,720 --> 00:20:14,300 isn't done scheming yet. 272 00:20:15,020 --> 00:20:21,820 Next on American Greed, see what happens when Shy double -crosses the feds. The 273 00:20:21,820 --> 00:20:26,600 first principal involved told us that Shy had tried to warn her about the 274 00:20:26,600 --> 00:20:27,600 federal investigation. 275 00:20:40,300 --> 00:20:46,140 Norman Shy knows he will be heading to prison soon. The question now is, for 276 00:20:46,140 --> 00:20:47,140 long? 277 00:20:48,220 --> 00:20:52,060 He's agreed to be an informant and collect evidence for the FBI. 278 00:20:52,800 --> 00:20:56,000 In exchange, he's hoping for a reduced sentence. 279 00:20:57,660 --> 00:21:01,660 However, Norman Shy tries to cheat the feds. 280 00:21:02,160 --> 00:21:07,640 In interviews with the U .S. Attorney's Office, Three principals admit Shai 281 00:21:07,640 --> 00:21:09,640 warned them about the investigation. 282 00:21:10,360 --> 00:21:15,140 We confronted Norman Shai with the fact that we were aware that he had warned 283 00:21:15,140 --> 00:21:16,580 certain principals. 284 00:21:17,860 --> 00:21:18,880 Shai confessed. 285 00:21:19,540 --> 00:21:24,020 After that, we made a determination not to make a motion for a sentence 286 00:21:24,020 --> 00:21:25,500 reduction for Norman Shai. 287 00:21:26,840 --> 00:21:32,860 In all, Norman Shai bills Detroit public schools for $5 million in school 288 00:21:32,860 --> 00:21:33,860 supplies. 289 00:21:34,780 --> 00:21:37,780 $2 .7 million of that is fraudulent. 290 00:21:38,060 --> 00:21:39,860 Mr. Shy, you have anything to say? 291 00:21:40,620 --> 00:21:41,620 No comment. 292 00:21:42,940 --> 00:21:46,600 $2 .7 million goes to the principals and Norman Shy. 293 00:21:46,860 --> 00:21:50,880 The principals only get $908 ,000. Norman Shy gets the rest. 294 00:21:52,260 --> 00:21:56,720 Shy pleads guilty, and the 74 -year -old is sentenced to five years in prison. 295 00:21:56,820 --> 00:22:00,340 He is also ordered to pay $2 .7 million in restitution. 296 00:22:01,100 --> 00:22:06,180 Eleven of the twelve principals and an administrator also plead guilty to 297 00:22:06,180 --> 00:22:07,180 conspiracy. 298 00:22:07,300 --> 00:22:09,620 Mr. Alexander, was this a just sentence? 299 00:22:10,800 --> 00:22:15,300 Principal Ronald Alexander of Spain Elementary gets one year in prison. 300 00:22:17,100 --> 00:22:20,040 Ronnie Sims is sentenced to 15 months. 301 00:22:22,600 --> 00:22:27,560 Josette Buendia takes her case to trial and is found guilty by a jury. 302 00:22:28,020 --> 00:22:30,420 She is sentenced to two years in prison. 303 00:22:31,020 --> 00:22:35,480 in order to pay more than $45 ,000 in restitution. 304 00:22:37,080 --> 00:22:38,560 Maybe it's classic greed. 305 00:22:38,800 --> 00:22:41,540 Maybe it's the classic no one will ever notice. 306 00:22:42,480 --> 00:22:47,220 Figuring, what the heck, there's a big slush pile of money out there, and I can 307 00:22:47,220 --> 00:22:48,520 take a little bit of it anyway. 308 00:22:49,860 --> 00:22:51,740 You're getting kids who need a hand up. 309 00:22:52,440 --> 00:22:57,480 And instead, Norman Shy and his co -conspirators gave him a smack across 310 00:22:57,480 --> 00:22:58,480 face. 311 00:23:04,650 --> 00:23:09,210 More than one million Americans serve in active duty in the U .S. military, 312 00:23:09,530 --> 00:23:12,670 fighting for freedom at home and abroad. 313 00:23:13,250 --> 00:23:17,690 For many, U .S. troops are held with great respect and admiration. 314 00:23:20,990 --> 00:23:25,630 Amy Bouchat is a reporter and editor for Military .com. 315 00:23:26,170 --> 00:23:29,230 I think that there's also something to be said for a man in uniform. 316 00:23:29,920 --> 00:23:34,640 I mean, everybody loves a man in uniform, right? And so military members 317 00:23:34,640 --> 00:23:35,640 typically very fit. 318 00:23:35,820 --> 00:23:38,380 So uniform, fit, handsome. 319 00:23:38,600 --> 00:23:44,420 But according to her husband, a major in the Alaska National Guard, crooks have 320 00:23:44,420 --> 00:23:45,420 another idea. 321 00:23:47,380 --> 00:23:51,760 Americans love American soldiers because American soldiers protect them. So how 322 00:23:51,760 --> 00:23:54,820 can I use that to exploit people and take from them? 323 00:23:58,510 --> 00:24:05,430 In the age of catfishing, it's easy for con artists to assume the identity of 324 00:24:05,430 --> 00:24:06,329 a hero. 325 00:24:06,330 --> 00:24:12,210 And it's even easier for these false heroes to trick victims into handing 326 00:24:12,210 --> 00:24:14,710 their wallets in the name of love. 327 00:24:16,070 --> 00:24:21,990 I don't think people realize the enormity of the scam that's going on on 328 00:24:21,990 --> 00:24:22,990 basis. 329 00:24:23,340 --> 00:24:27,140 Every day they're out there trolling the Internet looking for unsuspecting 330 00:24:27,140 --> 00:24:30,960 victims. They're throwing in the fishing line and looking for someone who's 331 00:24:30,960 --> 00:24:35,720 vulnerable and is open to a relationship. And once they snag them, 332 00:24:35,720 --> 00:24:37,920 them in and they take millions of dollars. 333 00:24:40,700 --> 00:24:44,880 I'm a hopeless romantic, so I thought maybe I would meet my husband online. 334 00:24:47,120 --> 00:24:50,860 Lilo Schuster is a chiropractic physician living in Illinois. 335 00:24:53,280 --> 00:24:58,180 In 2009, she goes on Match .com looking for someone special. 336 00:25:00,020 --> 00:25:04,320 My dating history would be I would go out with somebody for, I don't know, 337 00:25:04,320 --> 00:25:08,660 months, six months, and I could not date somebody for two years, three years, 338 00:25:08,740 --> 00:25:12,200 and so my heart was really hurting. I was really sad. I was desperate. 339 00:25:12,620 --> 00:25:14,960 I was pretty just kind of fed up. 340 00:25:15,340 --> 00:25:19,120 For years, Lilo yearns to start a family of her own. 341 00:25:19,390 --> 00:25:24,930 At one point, even spending $20 ,000 on artificial insemination. But 342 00:25:24,930 --> 00:25:26,910 unfortunately, with no results. 343 00:25:27,330 --> 00:25:28,870 I actually prayed to God. 344 00:25:29,090 --> 00:25:34,310 And I said, will you please send me a widow with a child? Because I love 345 00:25:34,310 --> 00:25:38,870 children. And by the time I'm 45, I thought, well, I probably won't have 346 00:25:38,870 --> 00:25:39,870 children of my own. 347 00:25:41,130 --> 00:25:45,910 Miraculously, the next morning, she checks her computer and her prayers have 348 00:25:45,910 --> 00:25:46,910 been answered. 349 00:25:47,760 --> 00:25:54,080 I can't believe that I had this email from my widow, and he has a child, and 350 00:25:54,080 --> 00:26:00,280 he's in Afghanistan, and he's fighting the terrorists, and he's a pilot, 351 00:26:00,360 --> 00:26:04,440 and I thought my prayers had been answered. 352 00:26:04,820 --> 00:26:08,520 His name, he says, is Officer Adam Smith. 353 00:26:09,040 --> 00:26:13,500 We started to email back and forth, and he sent me attractive pictures saying 354 00:26:13,500 --> 00:26:15,700 kind things and how... 355 00:26:16,000 --> 00:26:20,660 beautiful that i am and by the end of the year he wants to be able to come 356 00:26:20,660 --> 00:26:25,520 and we can create a family together so these kinds of things that i wanted to 357 00:26:25,520 --> 00:26:32,420 hear and it felt really nice actually officer smith tells lilo his wife died 358 00:26:32,420 --> 00:26:38,300 tragically not long ago and he's left with a sick daughter to care for i love 359 00:26:38,300 --> 00:26:44,240 children i always wanted them and not having my own that certainly was a way 360 00:26:44,240 --> 00:26:45,240 connect 361 00:26:45,770 --> 00:26:50,390 But within a few weeks of their relationship, a problem comes up with 362 00:26:50,390 --> 00:26:56,070 daughter. His daughter, who was in the United Kingdom with his mom, was going 363 00:26:56,070 --> 00:26:57,970 school, and they were going to go on a school trip. 364 00:26:58,630 --> 00:27:04,250 He asks for her help to pay for the trip, and he would, of course, pay her 365 00:27:05,970 --> 00:27:12,110 Lilo devotedly goes to Western Union, where she wires $2 ,700 to the UK. 366 00:27:13,050 --> 00:27:14,170 At this point... 367 00:27:14,520 --> 00:27:17,980 She has known him online for only four weeks. 368 00:27:18,360 --> 00:27:23,980 You feel like you're contributing to your relationship, that you're helping 369 00:27:23,980 --> 00:27:29,780 daughter be able to go on a trip that he couldn't provide for her. But, you 370 00:27:29,780 --> 00:27:32,100 know, he'll pay me back is what he had said. 371 00:27:35,220 --> 00:27:41,420 That same year in Colorado, a 38 -year -old single mother and hairdresser named 372 00:27:41,420 --> 00:27:44,660 Tracy Vassar has a very similar experience. 373 00:27:45,860 --> 00:27:50,580 As she later tells investigators in an interview at her home, Vassar meets a 374 00:27:50,580 --> 00:27:54,820 person online claiming his name is Captain Jeffrey Lawrence. 375 00:27:55,860 --> 00:28:00,400 And he was like, oh, I have a son, and he was supposed to be in Afghanistan. 376 00:28:00,960 --> 00:28:06,200 And he's like, I have a son, and his name is Paul, and I'm widowed, my wife 377 00:28:06,200 --> 00:28:10,080 dead, and someone watches after him because I have no family. 378 00:28:12,400 --> 00:28:18,260 In the same fashion, shortly after they start their online romance, her new beau 379 00:28:18,260 --> 00:28:19,260 has a problem. 380 00:28:19,620 --> 00:28:22,180 His son is in desperate need of cash. 381 00:28:23,560 --> 00:28:28,460 And then he was like, oh, he doesn't have any money. Could you send some 382 00:28:29,800 --> 00:28:34,140 In reality, neither of these women are talking to an officer in Afghanistan. 383 00:28:35,500 --> 00:28:39,100 And their stories have an all -too -common theme. 384 00:28:39,620 --> 00:28:40,680 The MO is all the same. 385 00:28:41,200 --> 00:28:44,440 I'm a single father. My wife, I'm a widower. 386 00:28:45,080 --> 00:28:48,940 I'm raising a five -year -old girl. And they play on the emotions of the 387 00:28:48,940 --> 00:28:49,940 victims. 388 00:28:50,300 --> 00:28:54,420 I didn't feel that it was a scam from the beginning. I felt that there was 389 00:28:54,420 --> 00:28:55,500 something that was off. 390 00:28:55,920 --> 00:28:57,380 I didn't know what it was. 391 00:28:58,500 --> 00:29:02,860 I speak to hundreds of victims, and it's hard for them to believe that they're 392 00:29:02,860 --> 00:29:03,639 being scammed. 393 00:29:03,640 --> 00:29:07,540 Someone is playing on your emotions, and they're making millions of dollars off 394 00:29:07,540 --> 00:29:09,200 of unsuspecting victims. 395 00:29:11,480 --> 00:29:18,320 Next, in a greedy twist, one victim changes the game and starts working with 396 00:29:18,320 --> 00:29:19,320 the crook. 397 00:29:28,500 --> 00:29:34,280 In Brighton, Colorado, 38 -year -old single mom Tracy Vassar is living the 398 00:29:34,280 --> 00:29:39,980 dream, quite literally, because her new love is all just a fantasy. 399 00:29:42,220 --> 00:29:48,420 As her first relationship fades, Tracy is introduced to a new online romantic 400 00:29:48,420 --> 00:29:50,580 interest named Kels Klein. 401 00:29:51,240 --> 00:29:56,900 He claims to be a sergeant stationed in Afghanistan and knows Captain Lawrence. 402 00:29:57,300 --> 00:29:59,900 Klein and Tracy hit it off immediately. 403 00:30:00,500 --> 00:30:02,340 Mr. Klein, at least in the beginning. 404 00:30:03,050 --> 00:30:09,050 made Tracy believe that he loved her. And they, at some point, were exchanging 405 00:30:09,050 --> 00:30:13,090 -mails, expressing their love for each other and wanting to be together in the 406 00:30:13,090 --> 00:30:14,090 future. 407 00:30:14,450 --> 00:30:17,090 Tracy is then asked for a favor. 408 00:30:17,670 --> 00:30:22,650 He was like, I need an agent to, like, pick up money. And I'm like, what? 409 00:30:24,070 --> 00:30:29,610 Sometimes the fraudsters then flip or turn these original victims. 410 00:30:30,270 --> 00:30:35,830 into mules themselves to take in money from other victims and open bank 411 00:30:35,830 --> 00:30:38,770 and then transfer yet more money. 412 00:30:39,450 --> 00:30:44,870 Sergeant Kels Klein tells Tracy Vassar she'll be transferring money from people 413 00:30:44,870 --> 00:30:49,470 all over the world to Nigeria for a charity fund for U .S. soldiers. 414 00:30:49,890 --> 00:30:52,690 She'll be acting as an agent for the government. 415 00:30:53,590 --> 00:30:57,810 It gives an air of legitimacy to the intended victim. 416 00:30:59,050 --> 00:31:01,990 Well, I'm not wiring the money overseas. I'm not sending it to Nigeria. 417 00:31:02,130 --> 00:31:06,590 Everybody knows that's a fraud. I'm sending it to this woman named Tracy 418 00:31:06,590 --> 00:31:11,610 that I've been told in this letter with military letterhead that she's the 419 00:31:11,610 --> 00:31:12,610 agent. 420 00:31:12,930 --> 00:31:18,310 In exchange for her help, Kells offers Tracy a small percentage of the money 421 00:31:18,310 --> 00:31:20,330 is transferring to help cover fees. 422 00:31:21,810 --> 00:31:23,970 One transaction leads to many. 423 00:31:24,540 --> 00:31:29,100 And Tracy starts taking in thousands of dollars from women all over the world 424 00:31:29,100 --> 00:31:33,760 and sends it to various places dictated by Sergeant Klein. 425 00:31:34,880 --> 00:31:37,760 They reached out via IM message. 426 00:31:38,380 --> 00:31:43,820 She would be instructed on when to collect it and directions of where it 427 00:31:43,820 --> 00:31:45,080 go, who it had to be sent to. 428 00:31:45,340 --> 00:31:51,680 In her correspondence with Klein, Tracy starts negotiating for a bigger cut of 429 00:31:51,680 --> 00:31:52,680 the profit. 430 00:31:53,450 --> 00:31:58,630 One message states, I can't do this for free, especially since I'm the one 431 00:31:58,630 --> 00:31:59,730 taking all the risk. 432 00:32:01,110 --> 00:32:05,650 Soon, she is opening bank account after bank account in an effort to hide the 433 00:32:05,650 --> 00:32:10,170 large amounts of money she is receiving and then immediately sending out. 434 00:32:11,070 --> 00:32:15,470 Numerous bank accounts at numerous banks all around the state because various 435 00:32:15,470 --> 00:32:19,520 banks. Or money remitter would get wise and move her down the road. So she'd 436 00:32:19,520 --> 00:32:22,880 have to come up with different names or excuses for people to accept that money. 437 00:32:22,980 --> 00:32:27,120 And all the while, taking some for yourself and pushing that money back to 438 00:32:27,120 --> 00:32:30,340 Nigerian. Her involvement became so extensive. 439 00:32:30,600 --> 00:32:37,020 And when she was wiring amounts in the tens of thousands of dollars, told us 440 00:32:37,020 --> 00:32:40,580 that she didn't believe that this was something that was legitimate. She knew 441 00:32:40,580 --> 00:32:41,580 what she was doing. 442 00:32:42,830 --> 00:32:48,410 It becomes so lucrative for Tracy, she even brings her own 71 -year -old 443 00:32:48,530 --> 00:32:50,490 Karen, into the scam as well. 444 00:32:51,090 --> 00:32:55,990 She involved her mother in collecting that money, and we even believe she 445 00:32:55,990 --> 00:33:00,550 recruited family members to in fact assist with this because it did get 446 00:33:00,550 --> 00:33:01,550 busy. 447 00:33:01,930 --> 00:33:06,310 But then the Brighton, Colorado Police Department gets a call from a woman in 448 00:33:06,310 --> 00:33:07,310 North Carolina. 449 00:33:07,740 --> 00:33:14,440 She said a military agent named Tracy Vassar, $2 ,000, but now believes 450 00:33:14,440 --> 00:33:15,600 it was a scam. 451 00:33:15,940 --> 00:33:20,840 Authorities look into the allegations and find enough evidence to support her 452 00:33:20,840 --> 00:33:21,840 claim. 453 00:33:22,820 --> 00:33:26,980 When the local authorities contacted Tracy Vassar, they explained to her that 454 00:33:26,980 --> 00:33:32,960 she was assisting fraudsters, in this case Nigerians, using her as a money 455 00:33:33,060 --> 00:33:36,460 And they explained to her that was a crime and to basically stop. 456 00:33:36,890 --> 00:33:37,890 helping the bad guys. 457 00:33:38,690 --> 00:33:44,710 Police hope that with their warning, Tracy will cease her illegal activity, 458 00:33:44,710 --> 00:33:46,430 they continue to monitor her. 459 00:33:48,490 --> 00:33:55,310 Back in Illinois, Lilo Schuster has already sent $2 ,700 to a person 460 00:33:55,310 --> 00:34:00,110 to be Officer Adam Smith, a man she thinks she's dating online. 461 00:34:00,710 --> 00:34:02,250 I thought we were going to get married. 462 00:34:03,470 --> 00:34:08,750 But a few weeks after sending the initial money, Officer Smith raises the 463 00:34:08,750 --> 00:34:12,530 and asks for even more cash via e -mail. 464 00:34:12,969 --> 00:34:19,590 When I questioned him the second time, then they berated me. You must not love 465 00:34:19,590 --> 00:34:21,909 me. You must not want our future together. 466 00:34:22,610 --> 00:34:26,130 I acquiesced, and I started to wire money. 467 00:34:26,989 --> 00:34:32,650 Lilo sends over a string of payments that total nearly $23 ,000 to Smith. 468 00:34:33,480 --> 00:34:38,500 But when she tells him she can't send any more, she suddenly stops hearing 469 00:34:38,500 --> 00:34:39,500 him. 470 00:34:39,540 --> 00:34:45,280 I just knew something was wrong because I wasn't getting any communication, and 471 00:34:45,280 --> 00:34:49,300 so I googled romance scams, and I found a website. 472 00:34:50,040 --> 00:34:55,440 And I couldn't believe it because you're reading word for word, this is exactly 473 00:34:55,440 --> 00:34:56,480 what happened to me. 474 00:34:57,280 --> 00:35:00,800 And that's when I knew, uh -oh, I just got scammed. 475 00:35:02,740 --> 00:35:07,080 Lilo contacts law enforcement and cuts off all communication. 476 00:35:08,500 --> 00:35:13,340 I was pretty upset because I felt so excited that I thought that I had met 477 00:35:13,340 --> 00:35:18,940 somebody. You realize it had nothing to do with me. It was only for my money. 478 00:35:19,280 --> 00:35:22,980 I was really embarrassed that I could let this happen to me. 479 00:35:23,300 --> 00:35:29,860 As Lilo tries to come to grips with her loss, Tracy Vassar continues to rake in 480 00:35:29,860 --> 00:35:30,860 profits. 481 00:35:31,910 --> 00:35:38,030 Next on American Greed, Amy Bouchard gets an alarming message about her 482 00:35:38,250 --> 00:35:42,810 I got a Facebook message from a woman telling me my husband had found her on 483 00:35:42,810 --> 00:35:46,590 Tinder and that he had tried to scam her out of money. 484 00:35:57,870 --> 00:36:01,370 Hello, everybody. You are listening to Davin's Den. 485 00:36:01,570 --> 00:36:07,550 To fight greedy scammers, comedian David Rosenblatt hosts a radio program on 486 00:36:07,550 --> 00:36:10,970 iHeartRadio that focuses on fraud. 487 00:36:11,430 --> 00:36:15,950 Big show tonight on the show. We like to reveal what the scammers are saying 488 00:36:15,950 --> 00:36:16,950 about you. 489 00:36:17,350 --> 00:36:22,390 Victims of catfishing scams contact the show to express their sobering stories 490 00:36:22,390 --> 00:36:25,230 of love and financial loss. 491 00:36:26,120 --> 00:36:30,000 But there is another layer to this romance fraud that few recognize. 492 00:36:30,780 --> 00:36:36,360 I think when a lot of people look at these online scams, they focus on the 493 00:36:36,360 --> 00:36:40,840 person who was duped. But there's another side of it. There's the person 494 00:36:40,840 --> 00:36:42,520 picture was taken. 495 00:36:44,380 --> 00:36:47,300 Amy Bouchard knows this all too well. 496 00:36:47,960 --> 00:36:52,360 Her husband, Luke Bouchard, is a major in the Alaska National Guard. 497 00:36:53,190 --> 00:36:57,590 I got a Facebook message from a woman telling me my husband had found her on 498 00:36:57,590 --> 00:37:01,950 Tinder and that he had tried to scam her out of some money. 499 00:37:02,970 --> 00:37:05,250 She was worried that I didn't know and I should know. 500 00:37:06,230 --> 00:37:13,210 Amy looked over at me with a lot of seething anger that she was trying 501 00:37:13,210 --> 00:37:18,590 to hold back and told me what was going on, like this communication that she was 502 00:37:18,590 --> 00:37:20,970 having with this lady over Facebook Messenger at the time. 503 00:37:22,680 --> 00:37:23,880 Completely caught off guard. 504 00:37:24,720 --> 00:37:29,520 I was pretty upset for, I would say, for about 15 minutes. 505 00:37:30,140 --> 00:37:34,700 And then very quickly it became apparent that this was a scam. 506 00:37:34,920 --> 00:37:38,280 She had sent me screenshots with the communications. 507 00:37:38,560 --> 00:37:44,040 And in those screenshots I could see that he was talking to her at times that 508 00:37:44,040 --> 00:37:46,780 know couldn't have been because we were together. 509 00:37:47,640 --> 00:37:52,240 on an island off of Florida without our cell phones. It was not possible. 510 00:37:52,980 --> 00:37:57,480 So when you Google boo shots, here's what you get. 511 00:37:58,480 --> 00:38:05,440 These scammers will steal your information, steal your image, and you 512 00:38:05,440 --> 00:38:10,180 to be able to either come together or grow apart as a couple because of that 513 00:38:10,180 --> 00:38:11,320 we've come together. 514 00:38:11,560 --> 00:38:16,300 So it's been a challenge, but nothing that we couldn't overcome. 515 00:38:21,800 --> 00:38:27,800 Former scam victim turned scammer Tracy Vassar and her mother have been working 516 00:38:27,800 --> 00:38:33,160 with online con artists for months, funneling money from victims to Nigeria. 517 00:38:33,880 --> 00:38:38,240 They knew that what they were doing was wrong when they were contacted by 518 00:38:38,240 --> 00:38:44,040 Brighton Police Department, but they set that aside because this was how they 519 00:38:44,040 --> 00:38:45,040 made money. 520 00:38:45,760 --> 00:38:50,520 Despite being warned by police, the Vassars continue working with the 521 00:38:50,520 --> 00:38:51,520 fraudsters. 522 00:38:51,720 --> 00:38:55,680 She knew what she was doing and knew that the money she was wiring was coming 523 00:38:55,680 --> 00:39:00,960 from innocent women, mostly women, all around the world. 524 00:39:01,200 --> 00:39:05,900 We put together all the amount of money that came in and all the amount of money 525 00:39:05,900 --> 00:39:10,340 that went out. And when you add it up, it was at least $1 .1 million. 526 00:39:12,800 --> 00:39:16,700 Law enforcement executes a search warrant on the Vassar home. 527 00:39:17,360 --> 00:39:20,280 When we entered the home that day, we saw... 528 00:39:20,540 --> 00:39:24,560 Just right out on the counters, a lot of money remitter paperwork and receipts 529 00:39:24,560 --> 00:39:27,940 of money getting repackaged and shipped out. 530 00:39:28,720 --> 00:39:35,720 From 2009 to 2012, an astonishing 374 victims throughout 531 00:39:35,720 --> 00:39:40,740 the United States and from 40 other countries were taken advantage of by the 532 00:39:40,740 --> 00:39:43,080 Vassars and the scammers they worked for. 533 00:39:44,940 --> 00:39:51,660 Tracy Vassar pockets at least $150 ,000 for her role in the scam that cost 534 00:39:51,660 --> 00:39:53,680 victims more than $1 million. 535 00:39:56,060 --> 00:39:59,780 She was very critical in terms of this scam working. 536 00:40:00,180 --> 00:40:04,620 And she's the one who received all the stolen money. Even though she may not 537 00:40:04,620 --> 00:40:08,580 have retained a large percentage of it, she received it. 538 00:40:14,920 --> 00:40:20,020 saw the amount of money that could come in, and she didn't have to do much for 539 00:40:20,020 --> 00:40:21,020 it. 540 00:40:21,460 --> 00:40:27,060 Both Tracy and her mother are arrested, and in a phone call from jail, the two 541 00:40:27,060 --> 00:40:30,420 discuss how they feel about the victims they helped scam. 542 00:40:38,910 --> 00:40:40,590 Oh, well, geez, you poor, poor victim. 543 00:40:40,870 --> 00:40:43,350 Why aren't you accountable for your own actions? 544 00:40:43,690 --> 00:40:44,690 Yeah, whatever. 545 00:40:45,930 --> 00:40:51,890 Tracy Vassar pleads guilty to racketeering and is sentenced to 15 546 00:40:51,890 --> 00:40:56,270 prison in order to pay more than $1 million in restitution. 547 00:40:57,150 --> 00:41:02,730 Her mother, Karen, also pleads guilty to racketeering and is sentenced to 12 548 00:41:02,730 --> 00:41:03,830 years in prison. 549 00:41:04,680 --> 00:41:09,940 Despite her plea in a letter to American Greed, Tracy maintains she is still 550 00:41:09,940 --> 00:41:11,580 just a victim herself. 551 00:41:12,080 --> 00:41:15,360 Her letter states, She 552 00:41:15,360 --> 00:41:22,140 continues on explaining her story 553 00:41:22,140 --> 00:41:23,140 and writes, 554 00:41:23,840 --> 00:41:30,760 Her characterization of herself as 555 00:41:30,760 --> 00:41:32,080 being a victim. 556 00:41:32,990 --> 00:41:36,810 It's a very small part, and it's only at the very beginning of how she probably 557 00:41:36,810 --> 00:41:39,830 got into this, but she ignored that afterwards. 558 00:41:41,030 --> 00:41:46,310 According to the FBI, a troubling number of victims lose millions every year to 559 00:41:46,310 --> 00:41:51,670 these romance scammers, including Lilo Schuster, who hasn't seen any of her 560 00:41:51,670 --> 00:41:54,050 almost $23 ,000 back. 561 00:41:54,990 --> 00:41:59,690 I don't believe in saying, why did this happen to me? I believe in going, you 562 00:41:59,690 --> 00:42:01,630 know what? What did I not do? 563 00:42:02,170 --> 00:42:05,130 There's crappy people out there, and there's great people too. 564 00:42:05,650 --> 00:42:11,370 And when you have a barometer within you at some level where you have to really 565 00:42:11,370 --> 00:42:15,090 listen to that, and I didn't, and I paid the price for that. 566 00:42:15,390 --> 00:42:19,780 Next. When money is no object. They had so much cash in these clinics, they kept 567 00:42:19,780 --> 00:42:22,860 the cash in garbage bags. The object is to get more. 568 00:42:23,300 --> 00:42:26,780 There's not many people who were able to scam as well as he did. Enter the dark 569 00:42:26,780 --> 00:42:29,820 side. American Greed, next on CNBC. 570 00:42:30,500 --> 00:42:32,460 That's a capitalist for you right there.