1 00:00:04,360 --> 00:00:09,720 In this episode of American Greed, he's called the Mormon Madoff. 2 00:00:10,100 --> 00:00:15,220 Sean Merriman is a bishop in the church, the father of four children, and the 3 00:00:15,220 --> 00:00:18,560 head of a thriving investment business, pulling in millions. 4 00:00:19,620 --> 00:00:23,740 Everybody wants to be a part of an exclusive club, so you had to get in 5 00:00:23,840 --> 00:00:26,120 That's why he was able to take advantage of so many people. 6 00:00:26,420 --> 00:00:31,860 But for 15 years, Merriman lives a lie, ripping off his neighbors, members of 7 00:00:31,860 --> 00:00:32,860 his church. 8 00:00:32,960 --> 00:00:34,200 Even his own mother. 9 00:00:34,440 --> 00:00:37,080 He just said, Mom, I have to tell you something very bad. 10 00:00:37,300 --> 00:00:40,220 I said, you took all of our money that we're counting on for retirement? 11 00:00:40,520 --> 00:00:41,840 He said, yes. 12 00:00:42,540 --> 00:00:44,580 Sean Merriman is a scam artist. 13 00:00:44,960 --> 00:00:49,560 And when the truth comes out, dozens of innocent investors will want to make him 14 00:00:49,560 --> 00:00:55,280 pay. I went home and loaded a .45 and had every intent of going down and 15 00:00:55,280 --> 00:00:56,280 him away. 16 00:01:15,050 --> 00:01:21,610 On April 8, 2009, in Aurora, Colorado, just outside of Denver, federal agents 17 00:01:21,610 --> 00:01:26,190 descend on the home of Sean Merriman, who is under investigation for financial 18 00:01:26,190 --> 00:01:27,190 fraud. 19 00:01:27,550 --> 00:01:32,810 Neighbors and reporters watch as agents haul out nearly 1 ,000 big -ticket 20 00:01:32,810 --> 00:01:38,890 items. More than 350 pieces of fine art, including works by Rembrandt and 21 00:01:38,890 --> 00:01:41,170 Picasso. A ski boat. 22 00:01:41,670 --> 00:01:47,030 Motorhome. and seven cars, including an Aston Martin, sports memorabilia, and 23 00:01:47,030 --> 00:01:52,470 taxidermy. It was like a giant yard sale. There was just stuff everywhere. 24 00:01:52,470 --> 00:01:55,710 were boxes, there were trailers with cars on them. 25 00:01:55,990 --> 00:02:00,950 It's an endless stream of luxury items, all bought with money Merriman stole 26 00:02:00,950 --> 00:02:02,150 from his investors. 27 00:02:02,610 --> 00:02:06,570 He was spending the money as fast as it was coming in. The seizure marks the 28 00:02:06,570 --> 00:02:10,229 beginning of the end for Sean Merriman, who has been living a double life. 29 00:02:10,560 --> 00:02:16,780 for 15 years, deceiving his own family, his church, and his investors, 30 00:02:17,220 --> 00:02:19,880 leaving a path of destruction in his wake. 31 00:02:26,480 --> 00:02:31,860 But long before Merriman strikes it rich, he is just a blue -collar kid in a 32 00:02:31,860 --> 00:02:33,320 family of construction workers. 33 00:02:34,620 --> 00:02:36,920 The family is always on the move. 34 00:02:37,440 --> 00:02:40,760 Merriman lives in nine cities in 13 years. 35 00:02:41,160 --> 00:02:45,140 The family moved around a lot. I think they moved to where the jobs were. 36 00:02:46,040 --> 00:02:49,700 Andrea Merriman was married to Sean for nearly 20 years. 37 00:02:50,040 --> 00:02:55,800 She remembers how Sean came from humble beginnings, but always had big plans for 38 00:02:55,800 --> 00:02:56,799 himself. 39 00:02:56,800 --> 00:03:01,640 He just was kind of an entrepreneurial type, even as a kid, you know, raised 40 00:03:01,640 --> 00:03:03,900 rabbits or did photography. 41 00:03:05,100 --> 00:03:07,520 did all kinds of creative things to make money. 42 00:03:08,740 --> 00:03:13,640 As a teen, Merriman finds religion and converts to Mormonism. 43 00:03:13,840 --> 00:03:18,460 He serves an 18 -month mission in the Vietnamese community in Denver. 44 00:03:19,000 --> 00:03:22,160 Day in and day out, he preaches the Book of Mormon. 45 00:03:22,520 --> 00:03:28,000 And then, as his mother Sally recalls, Merriman sets his sights on college. 46 00:03:28,440 --> 00:03:30,980 He liked the nicer, finer things of life. 47 00:03:31,360 --> 00:03:34,160 And he just set it up so that... 48 00:03:34,410 --> 00:03:38,590 he figured the career in finance would give him the way of life he wanted. 49 00:03:39,190 --> 00:03:43,550 Merriman enrolls in Brigham Young University and majors in economics. 50 00:03:44,170 --> 00:03:48,370 In 1987, he meets a classmate, Andrea Christensen. 51 00:03:48,650 --> 00:03:51,770 He was somebody who wanted to do big things. 52 00:03:52,550 --> 00:03:56,690 After a whirlwind romance, Sean and Andrea are married. 53 00:03:57,320 --> 00:04:02,620 We had plans for the future and our whole lives ahead of us, and that was 54 00:04:02,620 --> 00:04:06,040 start on the path to what I thought was going to be the fulfillment of all of 55 00:04:06,040 --> 00:04:07,040 our dreams. 56 00:04:07,880 --> 00:04:12,440 The couple moves to the suburbs of Denver and buys their first home. 57 00:04:13,360 --> 00:04:19,860 In the spring of 1990, Sean lands a job as a stockbroker at Chatfield Dean. 58 00:04:20,440 --> 00:04:26,680 Sean's dream in life was to become a stockbroker. And fresh out of college, 59 00:04:26,680 --> 00:04:28,820 got a job as a stockbroker to begin with. 60 00:04:29,140 --> 00:04:34,240 In the 80s and 90s, Chatfield Dean is one of the nation's largest penny stock 61 00:04:34,240 --> 00:04:38,820 companies, selling overpriced, risky stock to unsuspecting investors. 62 00:04:39,780 --> 00:04:44,280 Joe Manzanares, who worked at Chatfield Dean, recalls the high -stakes 63 00:04:44,280 --> 00:04:49,300 environment. The environment at Chatfield Dean in the early days, was 64 00:04:49,300 --> 00:04:55,700 high energy, really sell, sell, sell, get on the phone, dial 300, 400 calls a 65 00:04:55,700 --> 00:04:57,500 day looking for that new customer. 66 00:04:58,080 --> 00:05:04,120 Merriman is one of 100 brokers hired that year. His salary is 100 % 67 00:05:04,440 --> 00:05:06,260 The pressure to sell is intense. 68 00:05:06,980 --> 00:05:12,300 Brokers log 80 -hour weeks, making cold calls, pitching shares in small, unknown 69 00:05:12,300 --> 00:05:16,140 companies. New brokers coming into the business, they're really looking at a 70 00:05:16,140 --> 00:05:17,680 chance to make a lot of money quick. 71 00:05:18,240 --> 00:05:20,520 And there's a lot of pressure to produce. 72 00:05:20,720 --> 00:05:23,200 And if you're not producing, you're going to lose your job. 73 00:05:23,660 --> 00:05:28,540 Sean proves to be an excellent salesman. He quickly gains the trust of his 74 00:05:28,540 --> 00:05:31,600 investors and convinces them to hand over their money. 75 00:05:31,960 --> 00:05:37,920 And I remember that in his first three months as a stockbroker, I think he made 76 00:05:37,920 --> 00:05:39,440 between $50 ,000 and $60 ,000. 77 00:05:39,940 --> 00:05:43,160 So he was pretty good at what he did. 78 00:05:43,740 --> 00:05:49,020 But what his clients don't know is that Merriman is taking shortcuts and buying 79 00:05:49,020 --> 00:05:52,220 stock in companies without their approval. 80 00:05:52,640 --> 00:05:57,000 His investments usually didn't work out. He started doing unauthorized trades 81 00:05:57,000 --> 00:05:59,760 with his clients because the pressure to produce got to him. 82 00:06:00,180 --> 00:06:04,280 And at one time, you know, we had to look at letting him go from the company 83 00:06:04,280 --> 00:06:08,380 because people were complaining that the trades he was doing weren't authorized. 84 00:06:09,510 --> 00:06:13,990 Merriman makes a quick exit from Chatfield Dean and lands a new job with 85 00:06:13,990 --> 00:06:16,470 investment banking firm George K. Baum. 86 00:06:16,990 --> 00:06:21,430 He takes in a $54 ,000 signing bonus and is back to work. 87 00:06:23,410 --> 00:06:28,410 In April 1993, Sean and Andrea welcome their first child. 88 00:06:30,150 --> 00:06:35,430 Eight months later, they buy their dream home, a sprawling five -bedroom house 89 00:06:35,430 --> 00:06:37,910 situated on three acres of land. 90 00:06:39,400 --> 00:06:43,340 For Andrea and Sean, everything seems to be going according to plan. 91 00:06:44,360 --> 00:06:46,540 But Merriman is hungry for more. 92 00:06:47,500 --> 00:06:52,720 When American Greed returns, Merriman launches his own investment business, 93 00:06:52,720 --> 00:06:55,580 nearly loses it all when his trades tank. 94 00:06:56,140 --> 00:07:00,080 He did get in over his head fairly quickly, which is where I think the 95 00:07:00,080 --> 00:07:01,080 came in. 96 00:07:14,510 --> 00:07:20,710 In 1994, Sean and Andrea Merriman are like many young couples, full of big 97 00:07:20,710 --> 00:07:21,710 and dreams. 98 00:07:22,410 --> 00:07:28,990 Our plan for our future was to work hard and raise our kids to grow up to be 99 00:07:28,990 --> 00:07:34,390 good citizens and to make many happy family memories along the way. 100 00:07:34,710 --> 00:07:39,330 The couple are active members of the Mormon Church. They are raising a young 101 00:07:39,330 --> 00:07:42,730 son, and Sean is finding success as a stockbroker. 102 00:07:43,240 --> 00:07:45,960 But Merriman has bigger plans for his career. 103 00:07:46,180 --> 00:07:49,780 He decides he is ready to start his own investment firm. 104 00:07:50,040 --> 00:07:55,260 And we talked it over, and he really wanted to do it. And I'd been taught by 105 00:07:55,260 --> 00:07:59,640 mom to always support your husband in his dreams, so I thought it sounded like 106 00:07:59,640 --> 00:08:00,640 good plan. 107 00:08:00,920 --> 00:08:06,020 Merriman launches his own money management company. He names it Market 108 00:08:06,020 --> 00:08:11,020 Advisors. In June, he sets up shop in the basement of his new home. 109 00:08:11,400 --> 00:08:13,480 and begins drumming up investors. 110 00:08:14,020 --> 00:08:18,220 He'd get up every day and go down into the basement and shut the door behind 111 00:08:18,220 --> 00:08:23,480 him, and I really wouldn't see him until he came up for dinner in the evenings. 112 00:08:24,380 --> 00:08:29,940 Merriman is 31 years old and just a fledgling money manager, yet his company 113 00:08:29,940 --> 00:08:31,120 begins to take off. 114 00:08:32,020 --> 00:08:36,440 Merriman plays to his strengths and proves to be an excellent salesman. 115 00:08:36,659 --> 00:08:40,260 He was very charismatic. People describe him as somebody who you wanted to be in 116 00:08:40,260 --> 00:08:41,199 the room with. 117 00:08:41,200 --> 00:08:42,880 Everybody wanted to be around him. 118 00:08:43,320 --> 00:08:49,380 Merriman pulls in $400 ,000 from four separate investors and is off and 119 00:08:49,640 --> 00:08:54,140 It was easy to like him and easy to trust him. I think it was easy for him 120 00:08:54,140 --> 00:08:56,600 convince people to give him money. 121 00:08:57,180 --> 00:09:00,220 Merriman devises an aggressive investment strategy. 122 00:09:00,600 --> 00:09:04,820 He snaps up options on auto stocks, hoping for a big payday. 123 00:09:05,280 --> 00:09:10,160 But according to Postal Inspector Rob Barnett, Merriman's bets turned sour. 124 00:09:11,070 --> 00:09:16,090 He invested initially in Chrysler, a large investment in Chrysler, which lost 125 00:09:16,090 --> 00:09:17,930 fairly quickly $6 ,000. 126 00:09:18,390 --> 00:09:19,970 That was a big hit to him. 127 00:09:20,190 --> 00:09:23,270 And just in general, the market was not good to him, and he didn't make some 128 00:09:23,270 --> 00:09:26,910 good trades. So he lost a lot of money initially within the first 12 months. 129 00:09:27,530 --> 00:09:29,250 The losing trades continue. 130 00:09:29,850 --> 00:09:32,430 Merriman is shaken and in over his head. 131 00:09:33,110 --> 00:09:37,870 He has investors to answer to and a wife and a new son to support. 132 00:09:38,470 --> 00:09:40,630 He probably had a little bit of panic. 133 00:09:40,890 --> 00:09:45,610 of loss, that I can't admit to this. This is $400 ,000 of other people's 134 00:09:45,610 --> 00:09:51,990 that I'm responsible for, and I can't admit to losing it. So I can imagine he 135 00:09:51,990 --> 00:09:52,990 was panicked. 136 00:09:53,530 --> 00:09:59,030 He was very stressed about his job and said he had a big problem, and he was 137 00:09:59,030 --> 00:10:00,570 working on a way to fix it. 138 00:10:01,050 --> 00:10:06,410 And then I just remember a moment when he came to me and announced, oh, I 139 00:10:06,410 --> 00:10:08,090 figured out a way to solve my... 140 00:10:09,240 --> 00:10:15,860 accounting problem and i said oh good good for you and that was that was the 141 00:10:15,860 --> 00:10:22,500 extent of it merriman hatches a plan a way to cover up the loss and buy himself 142 00:10:22,500 --> 00:10:28,520 more time he'll start a new fund and reel in a new crop of investors but when 143 00:10:28,520 --> 00:10:33,080 made initial losses he had to try to cover it up so he had to find go out and 144 00:10:33,080 --> 00:10:37,080 find new clients and those new clients would put money in And that would enable 145 00:10:37,080 --> 00:10:41,280 him to pay off the old clients that were wanting to withdraw money. 146 00:10:41,800 --> 00:10:45,980 Merriman says his new investment fund will take a more conservative approach. 147 00:10:46,360 --> 00:10:51,380 He claims to be well -versed in sophisticated option strategies that 148 00:10:51,380 --> 00:10:53,960 steady returns of 7 to 20 percent. 149 00:10:54,380 --> 00:11:00,940 But he always said, I will use covered call options to cover the downside so 150 00:11:00,940 --> 00:11:03,900 there is really no risk and you won't lose money. 151 00:11:04,610 --> 00:11:09,050 Which, come to later find out, was kind of funny because he never passed his 152 00:11:09,050 --> 00:11:10,050 options exam. 153 00:11:10,510 --> 00:11:15,750 Merriman tells investors they need a minimum of $100 ,000 to get in. But he 154 00:11:15,750 --> 00:11:19,530 he will make an exception for his parents, Sally and Jack. 155 00:11:19,890 --> 00:11:23,230 And he told us he was really going for the big dollar investor. 156 00:11:23,550 --> 00:11:28,210 But because we were his parents, he would take, if we wanted to invest, with 157 00:11:28,210 --> 00:11:30,430 smaller amount, our much smaller amount. 158 00:11:31,080 --> 00:11:33,960 he would invest it to help make it grow. 159 00:11:35,400 --> 00:11:40,740 Jack Merriman worked in construction as a pipe fitter until he was 68 years old. 160 00:11:41,380 --> 00:11:47,120 After decades of scrimping and saving and raising a family, he has $35 ,000 in 161 00:11:47,120 --> 00:11:48,120 his retirement account. 162 00:11:48,500 --> 00:11:52,360 Now the Merrimans hand over that hard -earned money to their son. 163 00:11:52,900 --> 00:11:58,340 And you really feel, if you cannot trust your child that you have raised, then 164 00:11:58,340 --> 00:11:59,400 who can you trust? 165 00:12:00,590 --> 00:12:06,030 Each month, Sean mails a statement showing small but steady gains in his 166 00:12:06,030 --> 00:12:07,030 parents' account. 167 00:12:07,350 --> 00:12:11,970 We got wonderful statements every month telling us how this wonderful thing was 168 00:12:11,970 --> 00:12:14,630 growing. I was just amazed at how well he had done. 169 00:12:14,870 --> 00:12:18,130 Really. He must really know finance. 170 00:12:19,390 --> 00:12:24,690 After tapping his family, Merriman works his connections at church and in his 171 00:12:24,690 --> 00:12:25,690 neighborhood. 172 00:12:25,930 --> 00:12:29,690 And as Assistant U .S. Attorney Tim Neff discovers... 173 00:12:30,030 --> 00:12:34,450 Merriman frequents classic car shows on the prowl for new investors. 174 00:12:35,130 --> 00:12:38,730 One of the things he liked to collect was vintage cars. 175 00:12:39,050 --> 00:12:44,550 And so we started frequenting and going to various car shows. It was certainly a 176 00:12:44,550 --> 00:12:48,150 field that was ripe for the pickings, and Sean Merriman knew how to exploit 177 00:12:48,150 --> 00:12:49,150 that. 178 00:12:49,270 --> 00:12:55,490 In 1994, Merriman sets his sights on a new target, 54 -year -old Tim 179 00:12:55,490 --> 00:13:00,790 Gilmartin. Gil Martin is a commercial pilot, but it's cars that he is 180 00:13:00,790 --> 00:13:05,050 about. For years, he's been restoring a 1936 Kord. 181 00:13:05,670 --> 00:13:08,410 Now Merriman and Gil Martin strike up a friendship. 182 00:13:09,150 --> 00:13:13,170 We went to swap meets together. We went to shows together. Absolutely. 183 00:13:13,410 --> 00:13:14,410 We're good friends. 184 00:13:14,570 --> 00:13:15,570 It's all about the cars. 185 00:13:16,310 --> 00:13:19,990 Merriman tells Gil Martin he runs an exclusive investment club. 186 00:13:20,430 --> 00:13:23,050 but that it's currently closed to new investors. 187 00:13:23,510 --> 00:13:28,510 Sean Merriman always played the soft sell to the investors. Hey, I don't 188 00:13:28,510 --> 00:13:29,510 need your money. 189 00:13:29,870 --> 00:13:34,290 I don't like to necessarily deal with friends and family, but I'll make an 190 00:13:34,290 --> 00:13:35,290 exception here. 191 00:13:35,430 --> 00:13:41,170 And that whole idea that his investment fund was something exclusive was in part 192 00:13:41,170 --> 00:13:42,510 key to his success. 193 00:13:42,970 --> 00:13:46,350 I mean, this wasn't going to be open to everybody, so you had to get in quick, 194 00:13:46,410 --> 00:13:49,370 because if you didn't, you know, somebody else might step in. 195 00:13:49,790 --> 00:13:52,110 And that's why he was able to take advantage of so many people. 196 00:13:53,410 --> 00:13:57,730 One year later, Merriman offers Gilmartin a shot to get in the club. 197 00:13:57,990 --> 00:14:01,470 He said some shares came available. Somebody opted out of his fund. 198 00:14:01,790 --> 00:14:02,790 Shares came available. 199 00:14:03,050 --> 00:14:04,410 Would you like to invest with me? 200 00:14:04,690 --> 00:14:09,510 His shtick was, if I make money, I get 40 % of the profit. 201 00:14:09,730 --> 00:14:11,930 If I lose money, I don't take any money. 202 00:14:12,210 --> 00:14:14,010 So, okay, that sounds good. 203 00:14:15,010 --> 00:14:18,310 Yeah, it's a hefty price, but he was doing very well. 204 00:14:18,990 --> 00:14:24,450 Gil Martin and his wife Nancy buy in. They send Merriman a check for $48 ,000. 205 00:14:25,170 --> 00:14:30,170 Like clockwork, the couple starts receiving monthly statements showing 206 00:14:30,170 --> 00:14:31,390 consistent gains. 207 00:14:31,830 --> 00:14:34,870 We just let them ride. I mean, we got a statement every month, and it looked 208 00:14:34,870 --> 00:14:36,050 good. We're making money. 209 00:14:36,850 --> 00:14:38,210 Every month we're going up. 210 00:14:39,410 --> 00:14:43,490 The Gil Martins are watching their money grow, and they consider themselves 211 00:14:43,490 --> 00:14:46,530 lucky for the chance to invest with Sean Merriman. 212 00:14:47,080 --> 00:14:51,400 And they aren't the only lucky ones. Money is pouring into Market Street 213 00:14:51,400 --> 00:14:55,500 Advisors, and Merriman is again off and running. 214 00:14:56,120 --> 00:14:58,780 But he was successful in starting his scheme. 215 00:14:59,440 --> 00:15:03,900 He made that loss, covered it up, and was able to keep going. 216 00:15:04,420 --> 00:15:08,500 I think he had skill and talent in the area of salesmanship. 217 00:15:08,740 --> 00:15:14,340 He was a very good salesman. He could sell himself to anyone. 218 00:15:16,590 --> 00:15:17,650 Do it successfully. 219 00:15:19,310 --> 00:15:21,690 Merriman has a fresh infusion of cash. 220 00:15:22,050 --> 00:15:26,870 But instead of investing the money, he begins spending wildly on himself. 221 00:15:27,430 --> 00:15:31,170 He builds a 4 ,800 -square -foot addition on the back of his house. 222 00:15:31,990 --> 00:15:37,530 Inside is space for a new office, as well as a place to indulge in his 223 00:15:37,970 --> 00:15:39,390 I had an exercise room. 224 00:15:39,960 --> 00:15:43,260 It had space for the old cars that he collected and restored. 225 00:15:43,640 --> 00:15:46,980 It had a woodworking shop in it because he liked to build furniture. 226 00:15:47,420 --> 00:15:51,480 He was a big hunter. It had reloading stations in it. Pretty much everything 227 00:15:51,480 --> 00:15:53,380 that was his was down in that building. 228 00:15:54,440 --> 00:15:59,720 Merriman renovates the backyard and builds a swimming pool, sports court, 229 00:15:59,720 --> 00:16:01,160 ponds, and a gazebo. 230 00:16:01,760 --> 00:16:04,080 He heads to Africa on a game hunt. 231 00:16:04,320 --> 00:16:06,760 He takes his family on a trip to New Zealand. 232 00:16:07,260 --> 00:16:11,400 All of this paid for with money stolen from his investors. 233 00:16:11,780 --> 00:16:16,020 You have to be a greedy person to not only take these people's money, but then 234 00:16:16,020 --> 00:16:20,620 the lifestyle that he lived was so lavish. It was something that most of us 235 00:16:20,620 --> 00:16:21,720 wouldn't even dream about. 236 00:16:22,480 --> 00:16:27,280 Next on American Greed, a call to serve in the Mormon church is about to bring 237 00:16:27,280 --> 00:16:29,300 business to a whole new level. 238 00:16:29,560 --> 00:16:33,200 He used his position in the Mormon church as a bishop to get people to give 239 00:16:33,200 --> 00:16:34,740 money to him for his scheme. 240 00:16:35,000 --> 00:16:36,320 You might say he milked that. 241 00:16:51,760 --> 00:16:55,540 In 2001, Sean Merriman is living a double life. 242 00:16:55,800 --> 00:17:00,880 His family, his church, and his community see him as a devout Mormon, a 243 00:17:00,880 --> 00:17:03,520 man, and a successful money manager. 244 00:17:03,860 --> 00:17:08,220 But behind the scenes, Merriman has taken in millions of dollars from his 245 00:17:08,220 --> 00:17:12,420 unsuspecting clients, and his entire business is a sham. 246 00:17:12,780 --> 00:17:16,099 He didn't have an investment strategy because he didn't invest the money. He 247 00:17:16,099 --> 00:17:19,480 just took it and used it to live this lavish lifestyle. 248 00:17:20,560 --> 00:17:26,980 In 2001, Merriman's image gets a boost when he is called to serve as a bishop 249 00:17:26,980 --> 00:17:27,980 the Mormon church. 250 00:17:28,099 --> 00:17:31,820 It's a very sacred calling, and there's a very sacred trust. 251 00:17:32,300 --> 00:17:36,860 Brent Hillier is an elder in the Church of Jesus Christ of Latter -day Saints. 252 00:17:37,280 --> 00:17:41,560 Members of the church look to the bishop as their spiritual and temporal leader. 253 00:17:41,760 --> 00:17:44,480 They preside over the weekly services. 254 00:17:44,960 --> 00:17:48,880 They are well thought of and well respected by the congregation. 255 00:17:49,879 --> 00:17:54,180 Merriman dedicates more than 20 hours each week to his role as bishop. 256 00:17:54,380 --> 00:17:57,980 And at home, Merriman practices what he preaches. 257 00:17:58,460 --> 00:18:03,120 We had daily family prayer. We studied the scriptures with our kids every day. 258 00:18:03,300 --> 00:18:08,100 We had weekly family home evenings where we would do an activity as a family or 259 00:18:08,100 --> 00:18:13,960 teach our kids a life or gospel principle such as honesty or love within 260 00:18:13,960 --> 00:18:17,680 family, love at home, serving others, kindness. 261 00:18:19,370 --> 00:18:24,410 With the sanctity of the Mormon church behind him, Merriman's business takes 262 00:18:24,410 --> 00:18:27,370 off. And now he's a bishop in the Mormon church. 263 00:18:27,570 --> 00:18:29,630 That's just even more reason to trust him. 264 00:18:30,450 --> 00:18:35,490 Word of the devout money manager spreads around town, and investors are flocking 265 00:18:35,490 --> 00:18:36,490 to Merriman. 266 00:18:37,030 --> 00:18:41,570 Investors like Gary, who asks American Greed not to show his face. 267 00:18:42,170 --> 00:18:46,910 In 2001, Gary buys a home two doors down from Merriman. 268 00:18:47,320 --> 00:18:52,460 When his chiropractor touts Merriman's success, Gary wants to get in to the 269 00:18:52,460 --> 00:18:53,560 exclusive club. 270 00:18:53,880 --> 00:18:57,180 And he says, when you move in there, I've got somebody I want you to meet. 271 00:18:57,400 --> 00:19:02,500 He's an investment advisor, and everything he touches turns to gold. You 272 00:19:02,500 --> 00:19:07,600 amazed. He's the nicest guy, he's a bishop in our church, and everything he 273 00:19:07,600 --> 00:19:08,680 touches turns to gold. 274 00:19:09,900 --> 00:19:15,180 With just a high school degree, Gary began his career as a tool dealer. 275 00:19:15,560 --> 00:19:18,040 and eventually built a business from scratch. 276 00:19:18,540 --> 00:19:22,560 When he told you what his strategies were, they made a lot of sense. 277 00:19:23,060 --> 00:19:26,660 Like so many before him, Gary buys into the pitch. 278 00:19:27,020 --> 00:19:33,460 He sends Sean Merriman $70 ,000 and begins to watch in amazement as his 279 00:19:33,460 --> 00:19:39,800 grows. So you can see that if you average it out, it averages 12 to 20%. 280 00:19:40,400 --> 00:19:43,880 They were getting these statements in the mail that weren't outlandish. You 281 00:19:43,880 --> 00:19:48,500 know, they weren't earning 80%. They were regular statements that looked like 282 00:19:48,500 --> 00:19:50,880 they were earning what they should from a regular investment. 283 00:19:51,240 --> 00:19:57,160 And as time went along, we had amassed a decent -sized portfolio, enough that 284 00:19:57,160 --> 00:20:01,940 with the earnings that he was generating, I felt confident enough to 285 00:20:01,940 --> 00:20:02,940 business and retire. 286 00:20:03,200 --> 00:20:04,580 All the money went to Sean. 287 00:20:05,520 --> 00:20:08,880 Gary hands over the proceeds from the sale of his business. 288 00:20:09,340 --> 00:20:14,200 more than $600 ,000, and prepares to enjoy his retirement. 289 00:20:14,680 --> 00:20:18,540 I think a lot of investors probably thought, wow, I've really hit the 290 00:20:18,540 --> 00:20:23,760 here. I'm lucky that this genius, this guru, will give me an opportunity to 291 00:20:23,760 --> 00:20:27,200 invest with him. I'm not going to ask any more questions. I'm just going to 292 00:20:27,200 --> 00:20:31,460 trust that he just continues to make me my millions, when in reality he was 293 00:20:31,460 --> 00:20:33,500 swindling it right out of their back pocket. 294 00:20:34,640 --> 00:20:39,380 While Merriman is a superstar salesman, he's not a skilled investor. 295 00:20:39,740 --> 00:20:43,280 He is trading only sporadically and losing. 296 00:20:43,820 --> 00:20:49,200 He wanted to be a good investor. He was, so to speak, a legend in his own mind 297 00:20:49,200 --> 00:20:55,700 in the market. But the paper trail and the actual accounting record for his 298 00:20:55,700 --> 00:21:01,200 track success in the market was abysmal failure. He could not predict the market 299 00:21:01,200 --> 00:21:03,260 well, and he failed as a stockbroker. 300 00:21:03,870 --> 00:21:07,890 Behind the scenes, new money is not coming in fast enough. 301 00:21:08,190 --> 00:21:13,090 Merriman is having a hard time keeping up with the redemptions and funding his 302 00:21:13,090 --> 00:21:14,090 lavish lifestyle. 303 00:21:14,370 --> 00:21:16,790 The strain is beginning to show. 304 00:21:17,390 --> 00:21:23,930 In 2001, Tim Gilmartin has an unsettling experience when his wife asks for a $10 305 00:21:23,930 --> 00:21:26,110 ,000 withdrawal from their account. 306 00:21:26,530 --> 00:21:29,810 She takes the check, deposits it in that bank. 307 00:21:30,830 --> 00:21:35,210 And they call up and said, there's no money in this account. The check 308 00:21:35,570 --> 00:21:40,390 And imagine the stress that he must have been under to know when person A wanted 309 00:21:40,390 --> 00:21:43,090 his or her money, I've got to go out and find somebody else. 310 00:21:43,370 --> 00:21:48,890 But Merriman assures Gil Martin it is a bank error. And two days later, the 311 00:21:48,890 --> 00:21:49,890 check clears. 312 00:21:50,330 --> 00:21:53,550 For now, Merriman is managing to keep the business afloat. 313 00:21:53,990 --> 00:21:57,970 Ever the salesman, he continues to bring in new money. 314 00:21:58,400 --> 00:22:04,960 He knew how to continually get the confidence and trust of individuals. 315 00:22:05,720 --> 00:22:10,520 So it was an ultimate fraud, and he was excellent at doing it. 316 00:22:11,060 --> 00:22:16,380 Up next on American Greed, the money continues to flow in, and Merriman's 317 00:22:16,380 --> 00:22:18,520 spending kicks into high gear. 318 00:22:19,060 --> 00:22:23,320 If wanting more and more and more is what you call greed, it's fair to say 319 00:22:23,320 --> 00:22:25,540 Sean Merriman was a greedy, greedy man. 320 00:22:40,270 --> 00:22:44,910 By the early 2000s, Sean Merriman has weathered the ups and downs of his 321 00:22:44,910 --> 00:22:47,990 investment scheme and appears to be back on top. 322 00:22:48,290 --> 00:22:52,590 The esteemed Mormon bishop runs the most sought -after investment fund in town. 323 00:22:52,950 --> 00:22:58,530 He has dozens of investors from multiple states, and he is living big on his 324 00:22:58,530 --> 00:22:59,530 investor's dime. 325 00:22:59,890 --> 00:23:03,270 I mean, this guy was living a life that most of us will never get to live. 326 00:23:03,970 --> 00:23:07,150 Merriman takes his family on trips around the world. 327 00:23:07,710 --> 00:23:09,970 In 2001, they traveled to Africa. 328 00:23:10,230 --> 00:23:11,970 The next year, to England. 329 00:23:12,470 --> 00:23:16,210 Our family got to go to a lot of fun places. 330 00:23:16,470 --> 00:23:18,630 We were able to go to Turkey. 331 00:23:18,850 --> 00:23:24,750 We were able to go to Russia and Poland and Denmark and Sweden and Norway and 332 00:23:24,750 --> 00:23:27,170 Finland. We cruised the Panama Canal. 333 00:23:27,450 --> 00:23:34,190 We saw many, many islands in the Caribbean. We went pretty much anywhere 334 00:23:34,190 --> 00:23:35,190 a goal to go. 335 00:23:35,980 --> 00:23:42,800 And Merriman begins snapping up cars, a 1937 Kord, an Aston Martin with a price 336 00:23:42,800 --> 00:23:49,000 tag of $125 ,000, and a luxury motorhome for half a million dollars. 337 00:23:49,780 --> 00:23:55,380 And he builds an impressive taxidermy collection from his wild game hunts. He 338 00:23:55,380 --> 00:23:59,580 went to New Zealand and hunted. He went to Alaska and hunted. He went to Russia 339 00:23:59,580 --> 00:24:00,920 and hunted bear. 340 00:24:01,720 --> 00:24:08,260 He went to Cameroon, Ethiopia, Zambia, Zimbabwe, South Africa, Tanzania. He 341 00:24:08,260 --> 00:24:13,760 traveled anywhere where there was big game to be had, and then he would have 342 00:24:13,760 --> 00:24:18,020 trophies stuffed or mounted and taxidermied, and he'd put them down in 343 00:24:18,020 --> 00:24:24,140 building. So I always thought that his spending was way above and beyond what 344 00:24:24,140 --> 00:24:28,960 was necessary, but that was what he liked, and I thought he was working 345 00:24:29,870 --> 00:24:32,970 But Merriman has no legitimate source of income. 346 00:24:33,310 --> 00:24:39,310 Everything he buys and every exciting adventure is paid for with stolen 347 00:24:39,310 --> 00:24:45,610 money. But Andrea is kept in the dark and never suspects her husband is up to 348 00:24:45,610 --> 00:24:51,310 good. I got the same statements that everybody else did. So over time, I 349 00:24:51,310 --> 00:24:53,570 our money get to like the $10 million level. 350 00:24:54,300 --> 00:24:59,580 So I thought we were prepared for the future, that we had a good amount saved 351 00:24:59,580 --> 00:25:03,440 that we could live off of, that we could weather a lot of financial storms. 352 00:25:04,160 --> 00:25:09,800 By 2005, Merriman has discovered a new passion, collecting fine art. 353 00:25:11,080 --> 00:25:16,400 Merriman shells out millions of dollars and acquires an astounding 350 pieces, 354 00:25:16,760 --> 00:25:20,380 including etchings by Durer and Rembrandt. 355 00:25:21,000 --> 00:25:23,340 He had quite a collection. 356 00:25:23,800 --> 00:25:27,740 And I just always used to look at them and be amazed that they had survived 357 00:25:27,740 --> 00:25:29,300 many centuries intact. 358 00:25:29,720 --> 00:25:32,400 And there they were, hanging on the walls of our home. 359 00:25:33,080 --> 00:25:38,980 In March 2008, Merriman's collection is displayed in Denver in an exhibit called 360 00:25:38,980 --> 00:25:41,840 The Renaissance of Faith in Art. 361 00:25:42,480 --> 00:25:47,600 On display are 200 original works depicting the life of Christ. 362 00:25:47,960 --> 00:25:51,300 He wanted to build a Christ -centered collection of art. 363 00:25:51,980 --> 00:25:57,540 And it was Rembrandt etchings, old master prints, an original illuminator's 364 00:25:57,540 --> 00:26:00,820 Bible, all kinds of religious -themed artifacts. 365 00:26:02,360 --> 00:26:07,600 More than 30 ,000 visitors come to see the exhibit, and Merriman is hailed as a 366 00:26:07,600 --> 00:26:11,740 hero for making such renowned art accessible to the public. 367 00:26:12,320 --> 00:26:18,440 Sean Merriman was there, and he pridefully watched as individuals would 368 00:26:18,440 --> 00:26:20,580 his hand and admire the collection. 369 00:26:21,200 --> 00:26:24,500 It's hard to believe that when you think about the show, it's all based on a 370 00:26:24,500 --> 00:26:28,660 fraud, and the purchase of these items is all based on swindling of investors. 371 00:26:30,300 --> 00:26:32,900 For now, Merriman is riding high. 372 00:26:33,780 --> 00:26:39,660 But when American greed returns, with the markets in free fall, investors 373 00:26:39,660 --> 00:26:41,160 demanding their money back. 374 00:26:41,580 --> 00:26:45,960 But as people started asking for their money, Sean Merriman didn't have the 375 00:26:45,960 --> 00:26:48,960 money because he didn't invest it. He'd spent it. 376 00:26:49,260 --> 00:26:52,640 on his lavish lifestyle, there was nowhere for him to go. 377 00:27:01,120 --> 00:27:05,620 In 2008, the nation's economy has fallen into a recession. 378 00:27:06,480 --> 00:27:10,140 Breaking news all over Wall Street this morning. This is a special early morning 379 00:27:10,140 --> 00:27:14,480 edition of Squawk as Lehman Brothers files for bankruptcy. The stock markets 380 00:27:14,480 --> 00:27:17,480 plummeting. Unemployment is climbing at a record pace. 381 00:27:18,110 --> 00:27:20,150 And investors everywhere are nervous. 382 00:27:20,430 --> 00:27:23,750 But for Sean Merriman, it's business as usual. 383 00:27:24,170 --> 00:27:26,690 In July, he snaps up a ski boat. 384 00:27:27,130 --> 00:27:30,710 One month later, he buys a five -bedroom cabin in Idaho. 385 00:27:31,210 --> 00:27:35,990 He didn't show any signs of stopping. This was a guy who continued to want 386 00:27:35,990 --> 00:27:36,990 and more. 387 00:27:37,310 --> 00:27:41,810 While the markets are getting hammered, Merriman's statements continue to show 388 00:27:41,810 --> 00:27:42,850 consistent gains. 389 00:27:43,470 --> 00:27:46,290 And some investors are growing suspicious. 390 00:27:47,360 --> 00:27:53,980 He's still making money, and the S andP 100 is down over 45%. Tim 391 00:27:53,980 --> 00:27:57,500 Gilmartin has been investing with Merriman for 13 years. 392 00:27:57,900 --> 00:28:01,100 He has watched his investment increase fourfold. 393 00:28:01,380 --> 00:28:06,340 But now, he and some friends from the car club have an uneasy feeling. 394 00:28:06,820 --> 00:28:11,380 And one of them asked me, Tim, what do you think is happening here? Look, the 395 00:28:11,380 --> 00:28:14,360 market's going down like crazy, but Sean's still making money. 396 00:28:14,600 --> 00:28:16,220 Maybe we should do an audit. 397 00:28:17,200 --> 00:28:19,200 And I said, yeah, that's a good idea, you know. 398 00:28:19,840 --> 00:28:24,400 There were some vocal investors who were demanding a better, more independent 399 00:28:24,400 --> 00:28:30,340 accounting as to how his funds were managed and what their track record was. 400 00:28:30,540 --> 00:28:34,140 And the more they asked for that accounting, the more he resisted. 401 00:28:34,940 --> 00:28:38,460 Investors are hounding Merriman and demanding their money back. 402 00:28:38,720 --> 00:28:44,440 He panicked because people needed money, and they were coming to him to withdraw 403 00:28:44,440 --> 00:28:45,399 their investments. 404 00:28:45,400 --> 00:28:46,420 He didn't have it. 405 00:28:46,750 --> 00:28:48,790 And his world crumbled quickly. 406 00:28:49,750 --> 00:28:51,230 Merriman's accounts are empty. 407 00:28:51,430 --> 00:28:55,650 And with no new money coming in, he can't keep up with the pace of 408 00:28:56,170 --> 00:29:00,030 He takes out a loan on his house in the amount of $940 ,000. 409 00:29:00,750 --> 00:29:02,270 That buys him some time. 410 00:29:02,470 --> 00:29:06,470 But the fraud that Merriman orchestrated is about to collapse. 411 00:29:07,030 --> 00:29:08,810 He was in a pressure cooker. 412 00:29:09,130 --> 00:29:12,910 Sean Merriman really felt like he had been cornered. I don't think he had 413 00:29:12,910 --> 00:29:16,370 another option. I think the walls were closing in on him so fast he had no 414 00:29:16,370 --> 00:29:21,570 choice. Merriman realizes he can't keep up the charade any longer and weighs his 415 00:29:21,570 --> 00:29:22,570 remaining options. 416 00:29:23,090 --> 00:29:28,210 He talked about placing the fine art in a briefcase, fleeing to Europe, and 417 00:29:28,210 --> 00:29:32,250 selling these fine pieces of art over the years and remaining as a fugitive. 418 00:29:32,490 --> 00:29:36,610 He mentioned that he considered, but ultimately rejected, committing suicide, 419 00:29:36,790 --> 00:29:41,050 which left him with his ultimate card that he played in our case. 420 00:29:41,450 --> 00:29:45,190 to surrender to federal authorities, plea for mercy, and try to get the best 421 00:29:45,190 --> 00:29:46,169 deal he could. 422 00:29:46,170 --> 00:29:52,270 On March 18, 2009, Merriman turns himself in to federal authorities. 423 00:29:52,850 --> 00:29:58,150 In my 20 years, I'd never seen an instance where a crime of this magnitude 424 00:29:58,150 --> 00:30:04,070 revealed by an individual raising their hand and admitting to authorities, I've 425 00:30:04,070 --> 00:30:07,310 committed a horrible crime, I need to go to prison for a long time. That's how 426 00:30:07,310 --> 00:30:08,310 the case began. 427 00:30:09,200 --> 00:30:15,260 In a 90 -minute interview, Merriman details how Market Street Advisors was 428 00:30:15,260 --> 00:30:21,020 con. But I was actually struck at how matter -of -factly he recited the facts 429 00:30:21,020 --> 00:30:23,340 and his involvement in this particular case. 430 00:30:24,520 --> 00:30:28,460 Merriman brought in 68 investors from multiple states. 431 00:30:28,760 --> 00:30:33,480 And over the course of 15 years, he took in more than $21 million. 432 00:30:35,000 --> 00:30:37,560 Now, the money is spent. 433 00:30:38,140 --> 00:30:43,220 And I got the impression from him that on some level he was absolutely 434 00:30:43,220 --> 00:30:45,320 of living this lie. 435 00:30:45,700 --> 00:30:52,020 Many of Merriman's burned investors were family, close friends, neighbors, and 436 00:30:52,020 --> 00:30:53,120 fellow Mormons. 437 00:30:53,380 --> 00:30:57,200 To the people who lost money, it was absolutely the ultimate betrayal. 438 00:30:57,400 --> 00:31:01,280 It was a friend. He would go to barbecues with his clients. 439 00:31:01,480 --> 00:31:02,960 He would take them on trips. 440 00:31:03,200 --> 00:31:04,580 He would go to church with them. 441 00:31:05,050 --> 00:31:08,770 Talk about somebody who just betrayed everything that you ever believed in. 442 00:31:09,030 --> 00:31:10,730 That's what they say Sean Merriman did. 443 00:31:12,090 --> 00:31:17,210 After confessing, Merriman is allowed to walk free while the government builds 444 00:31:17,210 --> 00:31:18,210 its case. 445 00:31:18,370 --> 00:31:21,710 He returns home to break the news to his wife. 446 00:31:21,990 --> 00:31:26,850 And he said, I need to tell you that my company, Market Street Advisors, is a 447 00:31:26,850 --> 00:31:30,670 sham. And that was the beginning of the end for me. 448 00:31:31,130 --> 00:31:32,470 That's where it all ended. 449 00:31:34,160 --> 00:31:39,480 In an instant, Andrea discovers her life was based on a series of lies. 450 00:31:40,000 --> 00:31:43,380 I just sat there. I was so in shock. I couldn't react either. 451 00:31:44,460 --> 00:31:49,560 And then after he told me that he would be going away and I'd be left alone to 452 00:31:49,560 --> 00:31:53,660 raise our children and that he was sorry, he started to cry. 453 00:31:54,460 --> 00:31:57,640 And that's when I knew it had to be real, that it must not be a joke. 454 00:31:57,900 --> 00:31:59,960 I just could not comprehend it. 455 00:32:00,570 --> 00:32:03,950 All I could think of was, I need to get away from this man. 456 00:32:04,330 --> 00:32:08,590 I just felt like he was a stranger just in an instant, in a moment. 457 00:32:08,930 --> 00:32:14,030 He was someone that I didn't know, and I couldn't imagine that I'd ever known 458 00:32:14,030 --> 00:32:15,030 him. 459 00:32:16,070 --> 00:32:17,910 But Merriman isn't done. 460 00:32:18,150 --> 00:32:22,270 He picks up the phone and begins dialing each and every one of his victims, 461 00:32:22,550 --> 00:32:24,490 including his own mother. 462 00:32:24,830 --> 00:32:27,670 He just said, Mom, I have to tell you something very bad. 463 00:32:28,570 --> 00:32:29,570 I have... 464 00:32:29,600 --> 00:32:31,760 Been running a Ponzi scheme. I took your money. 465 00:32:33,620 --> 00:32:35,100 And that's when I said, how could you? 466 00:32:35,400 --> 00:32:38,360 I said, you took all of our money that we're counting on for retirement? 467 00:32:39,000 --> 00:32:40,500 He said, yes. 468 00:32:41,740 --> 00:32:45,020 And it's like, then what went wrong? Why would you do this? 469 00:32:45,680 --> 00:32:52,180 Sally and Jack's original investment of $35 ,000 had grown to $178 ,000. 470 00:32:53,180 --> 00:32:56,440 Now they learn that money has vanished. 471 00:32:56,840 --> 00:32:57,940 And it was just... 472 00:32:58,410 --> 00:32:59,410 You're sick. 473 00:32:59,510 --> 00:33:01,170 You are sick to your stomach. 474 00:33:01,930 --> 00:33:03,970 And you think, how could he? 475 00:33:04,830 --> 00:33:09,870 And he said, I feel I will only get five years because I am turning myself in, 476 00:33:10,010 --> 00:33:13,130 and I will help them as much as possible. 477 00:33:15,670 --> 00:33:18,330 It was just a total shock that everything was gone. 478 00:33:18,870 --> 00:33:22,550 For Tim Gilmartin, his suspicions are now confirmed. 479 00:33:23,370 --> 00:33:26,110 Merriman's betrayal is hard to comprehend. 480 00:33:26,630 --> 00:33:27,790 How could you do that? 481 00:33:28,250 --> 00:33:31,650 to your family, your friends, car guys, everybody. 482 00:33:31,870 --> 00:33:36,030 How could you do it? So I don't know how he slept at night. I really don't. 483 00:33:39,050 --> 00:33:43,090 Many investors, like Gary, are completely devastated. 484 00:33:43,630 --> 00:33:48,490 He just said, I notified the feds on Monday, and there is no money. 485 00:33:49,070 --> 00:33:50,290 There never has been. 486 00:33:51,230 --> 00:33:53,690 And this has all been a fraud and a sham. 487 00:33:54,610 --> 00:34:00,130 Gary had invested his entire life savings with Sean, more than $800 ,000, 488 00:34:00,390 --> 00:34:04,430 which had grown to more than $1 million on paper. 489 00:34:05,170 --> 00:34:06,430 Now it is all gone. 490 00:34:07,110 --> 00:34:10,050 The deception is more than Gary can bear. 491 00:34:10,949 --> 00:34:16,830 I went home and loaded a .45 and had every intent of going down and blowing 492 00:34:16,830 --> 00:34:17,830 away. 493 00:34:17,969 --> 00:34:22,710 But when I got to the front door, I realized that would put me in prison 494 00:34:23,290 --> 00:34:24,909 and I'd miss my family. 495 00:34:25,969 --> 00:34:31,909 The investors were outraged. They frankly, you know, wanted blood for Mr. 496 00:34:32,070 --> 00:34:34,730 Merriman. When American Greed returns, 497 00:34:35,530 --> 00:34:41,170 Sean Merriman will have his day in court and come face to face with his outraged 498 00:34:41,170 --> 00:34:44,650 investors. I want to see that son of a bitch go to jail. 499 00:34:58,800 --> 00:35:03,880 In March 2009, the news of Sean Merriman's scam spreads quickly. 500 00:35:04,220 --> 00:35:09,040 No one, it seems, suspected Merriman capable of such deceit. 501 00:35:09,300 --> 00:35:15,640 You begin to wonder if the man has a soul or a heart to engage in this kind 502 00:35:15,640 --> 00:35:18,100 just callous conduct. 503 00:35:20,300 --> 00:35:26,060 On April 8, the team of federal agents arrives at Merriman's sprawling home to 504 00:35:26,060 --> 00:35:27,500 begin seizing his assets. 505 00:35:28,520 --> 00:35:33,500 But even in their wildest dreams, agents could never have imagined the treasure 506 00:35:33,500 --> 00:35:35,460 trove they were about to uncover. 507 00:35:37,420 --> 00:35:39,020 That part was overwhelming. 508 00:35:40,200 --> 00:35:46,280 All of us are amazed and just in shock that there was so much stuff. 509 00:35:47,920 --> 00:35:52,960 Packed into the building behind his house, investigators discover seven 510 00:35:55,050 --> 00:36:01,830 A 22 -foot ski boat, a luxury motorhome, a Harley Davidson and 13 dirt bikes and 511 00:36:01,830 --> 00:36:08,730 dune buggies, a taxidermy room, 34 antique weapons, and nearly 200 pieces 512 00:36:08,730 --> 00:36:10,310 of sports memorabilia. 513 00:36:11,310 --> 00:36:16,690 And artwork is piled up to the ceiling, more than 350 words. 514 00:36:17,230 --> 00:36:21,470 We were just dumbfounded at the amount of the stuff that he had accumulated and 515 00:36:21,470 --> 00:36:25,840 bought. Neighbors look on as the items are tagged and hauled away. 516 00:36:26,200 --> 00:36:27,660 So he wasn't behind bars. 517 00:36:27,900 --> 00:36:32,920 And his neighbors, who were investors, the people he'd taken advantage of, sat 518 00:36:32,920 --> 00:36:38,600 on their front porch and watched this lavish lifestyle, all this stuff just 519 00:36:38,600 --> 00:36:39,600 out of this place. 520 00:36:39,880 --> 00:36:44,200 You want to talk about the ultimate insult. It must have been like rubbing 521 00:36:44,200 --> 00:36:45,200 in the wound. 522 00:36:45,400 --> 00:36:48,180 After five months of walking free... 523 00:36:48,620 --> 00:36:52,580 Merriman is finally arrested and charged with one count of mail fraud. 524 00:36:53,000 --> 00:36:59,300 He pleads guilty and on September 14, 2010, stands in a packed courtroom to 525 00:36:59,300 --> 00:37:00,300 learn his fate. 526 00:37:00,680 --> 00:37:06,200 Thirty investors are on site, many sharing with the court their own stories 527 00:37:06,200 --> 00:37:07,680 grief and devastation. 528 00:37:07,900 --> 00:37:14,140 I wanted the judge to consider the ramifications of what he did and to make 529 00:37:14,140 --> 00:37:15,980 pay for as long as he could. 530 00:37:16,540 --> 00:37:21,700 Sean Merriman had told his mother he expected a light sentence since he 531 00:37:21,700 --> 00:37:22,700 himself in. 532 00:37:22,840 --> 00:37:28,140 Sally, who was defrauded herself, shows no mercy to her son and writes a letter 533 00:37:28,140 --> 00:37:30,480 urging the judge to make him pay. 534 00:37:30,940 --> 00:37:35,100 I recall thinking to myself, wow, that gives you some insight as to just how 535 00:37:35,100 --> 00:37:36,880 deep and how bad this crime was. 536 00:37:37,100 --> 00:37:40,860 When his very own mother wants a heavy sentence for her son. 537 00:37:41,820 --> 00:37:44,480 Sean Merriman is sentenced to the maximum. 538 00:37:44,970 --> 00:37:46,530 12 and a half years in prison. 539 00:37:47,370 --> 00:37:50,250 For many investors, that is not long enough. 540 00:37:51,490 --> 00:37:55,770 But for Merriman's four children, it seems unimaginable. 541 00:37:56,030 --> 00:38:00,950 All I could think of was, my son's going to be 28 the next time he sees his dad. 542 00:38:01,130 --> 00:38:02,130 That's my oldest. 543 00:38:02,650 --> 00:38:08,470 And my youngest will grow up without his dad, and he'll be 15 or 16 before he 544 00:38:08,470 --> 00:38:09,930 really gets to meet him. 545 00:38:10,730 --> 00:38:14,170 They lost their whole lives. 546 00:38:14,650 --> 00:38:19,530 At a very young age, I think they have had to live through something that 547 00:38:19,530 --> 00:38:21,050 should ever have to live through. 548 00:38:22,330 --> 00:38:24,110 The betrayal runs deep. 549 00:38:24,930 --> 00:38:29,450 Andrea and her kids have lost countless relationships with friends and family 550 00:38:29,450 --> 00:38:31,010 who were scammed by Sean. 551 00:38:31,590 --> 00:38:36,610 And they have been the target of many accusations, despite being cleared of 552 00:38:36,610 --> 00:38:39,730 wrongdoing. Was Andrea Merriman part of this scheme? 553 00:38:39,950 --> 00:38:42,730 That was one of the first questions we had and the first question we looked 554 00:38:42,730 --> 00:38:43,730 into. 555 00:38:43,920 --> 00:38:48,580 And there was nothing anywhere that indicated that she knew what was going 556 00:38:48,940 --> 00:38:54,500 It was a difficult time. There were a lot of people angry at us. I felt bad. I 557 00:38:54,500 --> 00:38:59,140 felt guilt that I was married to someone that would do something like that. 558 00:39:00,080 --> 00:39:05,860 Looking for a fresh start, Andrea files for divorce and moves to Utah where she 559 00:39:05,860 --> 00:39:07,760 finds a job in public relations. 560 00:39:08,920 --> 00:39:12,300 She eventually remarries and builds a new life. 561 00:39:12,760 --> 00:39:18,440 But I have chosen to move on every single day since then. So I think that's 562 00:39:18,440 --> 00:39:25,140 key to surviving hard things is choosing to carry on and choosing to make a new 563 00:39:25,140 --> 00:39:28,900 life out of what you're left with, even if you're not left with very much. 564 00:39:29,820 --> 00:39:34,940 The luxurious lifestyle Andrea and her children once knew is gone for good. 565 00:39:35,260 --> 00:39:39,280 But the family has found happiness again in a simpler way of life. 566 00:39:39,850 --> 00:39:42,510 Sometimes you have to have something bad to put your life in the right 567 00:39:42,510 --> 00:39:47,370 perspective. And for me, I grew up with everything I wanted and was really 568 00:39:47,370 --> 00:39:52,930 worried about stuff like that. But now I've learned what's important and I'm a 569 00:39:52,930 --> 00:39:53,930 better person because of it. 570 00:39:56,330 --> 00:39:58,710 Sean Merriman has lost everything. 571 00:39:58,930 --> 00:40:02,690 His family, his fortune, even his religion. 572 00:40:04,330 --> 00:40:08,810 Once an esteemed bishop, Merriman has been excommunicated from his church. 573 00:40:09,520 --> 00:40:12,520 He violated the trust that was given to him in that position. 574 00:40:13,540 --> 00:40:17,180 He was excommunicated within just a few days. 575 00:40:18,120 --> 00:40:21,960 That's the most severe action that can be taken in the church. 576 00:40:24,120 --> 00:40:29,740 The tragedy of this whole thing is the talents and the intelligence and the 577 00:40:29,740 --> 00:40:35,400 potential that he had to do anything. He could do so many things and 578 00:40:35,400 --> 00:40:38,340 selfishness and greed and pride. 579 00:40:39,440 --> 00:40:42,900 took all of that away, and now he's left with nothing. 580 00:40:43,840 --> 00:40:44,840 Absolutely nothing. 581 00:40:45,040 --> 00:40:48,700 He's alone in a cell. No family, no money, no home, no cars. 582 00:40:48,920 --> 00:40:49,920 Nothing. 583 00:40:50,940 --> 00:40:55,980 But for Sean Merriman's victims, many had their dreams, their future, and 584 00:40:55,980 --> 00:40:58,220 security stolen from them. 585 00:40:59,140 --> 00:41:01,600 Many victims lost everything. 586 00:41:01,960 --> 00:41:03,700 They lost their retirement savings. 587 00:41:04,000 --> 00:41:06,520 They lost kids' and grandkids' college funds. 588 00:41:06,880 --> 00:41:08,520 Some of these folks were retired. 589 00:41:09,240 --> 00:41:13,080 Well, they had to go back to work. They had to find more jobs because they lost 590 00:41:13,080 --> 00:41:17,620 everything. Many of Merriman's assets were auctioned off. 591 00:41:17,900 --> 00:41:23,360 But authorities say investors will be lucky to get back pennies on the dollar. 592 00:41:24,220 --> 00:41:25,540 He's a sociopath. 593 00:41:26,200 --> 00:41:31,340 He doesn't care about anything but Sean. 594 00:41:32,480 --> 00:41:36,540 He doesn't care that you've invested your complete life with him. 595 00:41:37,320 --> 00:41:43,160 After losing more than $1 million in the scam, Gary couldn't make his mortgage 596 00:41:43,160 --> 00:41:46,020 payments and eventually lost his home. 597 00:41:46,580 --> 00:41:49,380 I hope I never have to look him in the eye again. 598 00:41:50,680 --> 00:41:54,780 And if he dies in prison, yay. 599 00:41:55,440 --> 00:41:56,980 He got what he deserved. 600 00:41:58,220 --> 00:42:02,420 Sally and Jack Merriman lost more than their retirement. 601 00:42:02,880 --> 00:42:03,880 The hurt stays. 602 00:42:04,720 --> 00:42:06,620 And it's the betrayal that... 603 00:42:06,890 --> 00:42:08,590 Of the parents, that is the worst. 604 00:42:09,130 --> 00:42:11,730 In a way, it is the death of your child. 605 00:42:12,510 --> 00:42:15,130 The child as you knew them is gone. 606 00:42:16,590 --> 00:42:19,210 You can't open that door again and let him back in. 607 00:42:21,190 --> 00:42:23,330 A con artist will be a con artist. 608 00:42:25,370 --> 00:42:30,530 And no, the best way to protect yourself is to have nothing more to do with 609 00:42:30,530 --> 00:42:31,530 them. 610 00:42:32,670 --> 00:42:36,010 Sean Merriman sits in a prison cell in South Dakota. 611 00:42:36,680 --> 00:42:40,200 He is scheduled to be released in August 2020. 612 00:42:40,820 --> 00:42:43,080 He just became a really master thief. 613 00:42:43,840 --> 00:42:46,040 But master thieves do get caught. 614 00:42:47,800 --> 00:42:48,800 And he did.