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The Great And Terrible Lou Pearlman, Boy Band Architect And Ponzi Schemer

Lou Pearlman on June 27, 2007. CREDIT: AP PHOTO/JOHN RAOUX, FILE
Lou Pearlman on June 27, 2007. CREDIT: AP PHOTO/JOHN RAOUX, FILE

The music was so good.

It wasn’t cool, even when it was popular, and it wasn’t highbrow or clever. It wasn’t political. It wasn’t daring. Didn’t push boundaries, didn’t challenge the imagination, didn’t even always make sense. (What did the Backstreet Boys want, and in what way? We may never know!)

But it was good, wasn’t it? Those early ‘N Sync and Backstreet Boys songs that monopolized the top spots on MTV’s Total Request Live, with the hooks you couldn’t get out of your head and the lyrics you can’t believe you still know. Catchy as a rumor in a high school hallway, syrupy and saccharine and bright. Confection perfection.

And none of those hits — not “I Want it That Way” or “As Long As You Love Me” or “Tearin’ Up My Heart” or “I Want You Back” — would exist if it hadn’t been for Lou Pearlman, a blimp-obsessive turned boy-band Svengali who also, as unluck would have it, was a scam artist extraordinaire who landed in federal prison after he got busted for running a years-long Ponzi scheme that defrauded investors out of over $300 million. And that was after he was sued by both the Backstreet Boys and ‘N Sync, his two most profitable and famous hand-assembled music groups, for cheating them out of millions they’d earned as two of the highest-earning bands of their day.

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Pearlman died on August 19. He was incarcerated at the Federal Correctional Institution in Miami, though he died at a hospital of cardiac arrest. He was 62 years old.

His legacy, then, is both one of astonishing achievement and appalling misconduct. He was the impresario behind two absurdly successful music groups— the Backstreet Boys remain the best-selling boy band of all time — and, through the artists he managed, launched the careers of mega-producers who would go on, in turn, to craft the songs that would launch careers of more mega-pop-stars, and on and on for the next 25 years and counting. He was also a liar and a thief who, on top of being a Ponzi schemer, allegedly used his position as the self-proclaimed “Big Poppa” of his boy bands to sexually abuse some of his charges; Jane Carter, Backstreet Boy Nick Carter’s mother, has reportedly called him a “sexual predator.”

John Seabrook, a New Yorker staff writer, literally wrote the book on the engineering behind modern pop music and the characters, like Pearlman, who constructed the pop landscape in which we currently reside. He spoke with ThinkProgress by phone about Pearlman’s rise, fall, and legacy.

Lou Pearlman wasn’t a singer or a songwriter. He wasn’t a producer. He was an assembler of talent — an architect of the bands — and he managed them, but, given what we now know about his financial dealings, he technically did not manage them very well. Yet clearly there is some ability there that he has that made him a huge player and influencer in the music industry. What, exactly, would you say his talent was?

That’s a really good question. He didn’t obviously display any of the main talents — he did write a few songs, but none of them were ever recorded by the Backstreet Boys. And he did have a sense of vocal harmonies, I think, that he’d gotten from listening to music when he was young and figuring out how harmony works. The Backstreet Boys were beautiful harmony singers.

But I think the thing that made him successful was, he got that concept of an MTV boy band. He had this concept he got from New Kids On the Block, and it wasn’t really a music concept. It was a commercial idea that the right combination of white guys singing a kind of light R&B-type music could not only sell massive tickets but, more importantly, could sell an incredible amount of merchandise. That was really Lou’s vision: He saw all of the merchandise, not that the kids bought themselves but their parents or aunts and uncles or grandparents bought for them. And he also recognized that boys didn’t buy the same kind of band-related merchandise that girls did, so he was much more successful on the boy band side with girl fans than with boy fans. He never really connected with guys.

“He got that concept of an MTV boy band. He had this concept he got from New Kids On the Block, and it wasn’t really a music concept. It was a commercial idea that the right combination of white guys singing a kind of light R&B-type music could not only sell massive tickets but, more importantly, could sell an incredible amount of merchandise.”

He was a guy who wanted to know how he could improve the product, and the way he improved the product was, he found guys who could sing. The knock on New Kids on the Block was that they couldn’t actually sing, and their svengali, Maurice Starr, was the guy who actually did the singing. There was a huge scandal about that. They went on Arsenio Hall to prove they could sing. And that’s why when the Backstreet Boys performed, they always did at least one song acapella to show that they actually could sing.

That was where Lou was coming from, and he had the ability to find the people. He found the manager, he found the talent scout, he found the songwriter, the producer. He got lucky in that the Backstreet Boys started out on another label, Mercury, that dropped them because they thought they were very square and no one would like them. Then the Backstreet Boys get picked up by Jive, which is run by this guy Clive Calder, a genius of another kind — a business genius, and also a guy who was a real record-making genius, which is something Lou seemed to not care about at all. A lot of guys in this business are in the studio all day long and that’s what they care about. That wasn’t Lou at all.

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It was Clive who hooked him up with Max Martin* and Denniz PoP**, and Lou went along for the ride and paid for it, because Clive was kind of cheap, and Lou was always liberal with the funds. That was another reason people were drawn to him and willing to work with him, because he seemed to have an endless amount of money and could bankroll these groups out of his own pocket, which was fairly unheard of. So it was in the area of business and marketing that Lou’s gift lay.

*Max Martin is the Swedish songwriting-producing wizard behind more than 20 Billboard Hot 100 number one songs, including Britney Spears’ “…Baby One More Time” (his first no. 1, back in 1999), a fleet of Katy Perry songs (“I Kissed a Girl,” “California Gurls,” “E.T.,” “Last Friday Night,” “Part of Me,” “Roar,” “Dark Horse”), and most of Taylor Swift’s post-country smashes (“We Are Never Ever Getting Back Together,” “Shake it Off,” “Blank Space,” “Bad Blood”).

**You can thank the late Denniz PoP, another Swedish DJ-producer-songwriter, for providing Ace of Base with “The Sign,” “Don’t Turn Around,” “Beautiful Life,” and “All That She Wants,” and for bringing Max Martin into his recording studio in the first place, with whom he co-produced Britney Spears’ debut album as well as songs for the Backstreet Boys (“Everybody (Backstreet’s Back),” “We’ve Got it Goin’ On”) and ’N Sync (“Here We Go,” “I Want You Back”).

So is Lou the person who brought Britney to Jive? Because he wanted her for his girl group, the atrociously-named Innosense, and she decided to go solo instead?

It was Britney Spears’ agent, Larry Rudolph*, who is now one of the biggest agents in the music business, who, I think, advised her not to sign with Lou Pearlman. He’d represented Lou on some other deals, so he knew Lou, and for whatever reason, Larry advised her not to sign with Lou and he was the one who set up the meeting at Jive.

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*Rudolph is the manager who reportedly masterminded Miley Cyrus’ transition from Hannah Montana to wrecking ball rider/VMA-twerker.

It sounds, then, like at least someone in the music industry had an inkling early on that working with Lou was a bad idea. At what point did people start to realize his financial dealings weren’t 100% kosher? Didn’t anyone look up at the start and ask, “Where is all this money coming from?”

That’s another really good question that no one seems to be up front about answering. If you ask people, it’s because they’ll say Lou was the least suspicious-seeming guy in the world. He always paid for everything, was quick with a good word and a pat on the back and the glad-handing and everyone is gonna win-win. People believe what they want to believe. In the music business, nobody really knows anything.

L: The Backstreet Boys perform at the Super Bowl XXXV on January 28, 2001. CREDIT: AP PHOTO/DAVE MARTIN R: Backstreet Boys perform in Germany on May 31, 2005. CREDIT: AP PHOTO/HERMANN J. KNIPPERTZ
L: The Backstreet Boys perform at the Super Bowl XXXV on January 28, 2001. CREDIT: AP PHOTO/DAVE MARTIN R: Backstreet Boys perform in Germany on May 31, 2005. CREDIT: AP PHOTO/HERMANN J. KNIPPERTZ

So if there’s a guy that seems confident and drives around in a cornflower blue Rolls Royce Corniche… I learned for The Song Machine that even early on in the Backstreet Boys’ career, there were always people around that were given rides on the bus or even on the airplane or in the helicopter, and it was never really clear what they were doing there. And obviously in retrospect, they were investors in Lou’s Trans Continental Airlines*, which the Backstreet Boys and ’N Sync were all kind of mixed up in, and he was using the bands as a way to make investors happy and give them perks. So that was happening from an early time.

*Lou’s company was a luxury service that provided charter planes, most of which did not exist. The planes pictured in the Trans Continental brochures were really just model airplanes carefully photographed to look real. The jumbo jet was a toy that used to sit on Lou’s childhood dresser, and the whole company was the centerpiece of his massive Ponzi scheme.

But I don’t think anybody really suspected anything until very late. And one of the people you wonder about is Clive Calder*, who was a business genius; you would imagine someone like that would have some suspicion, at least, that this guy was not legitimate. But Lou stayed in business until his bands basically fired him.

*Clive Calder, a self-made billionaire, signed Britney Spears and the Backstreet Boys to Jive, then lured ‘N Sync to Jive from BMG’s RCA label (BMG sued and eventually settled). Years earlier, Calder signed the Cars, Def Leppard, Billy Ocean, Will Smith’s DJ Jazzy Jeff & the Fresh Prince, and A Tribe Called Quest.

Was Lou fired strictly because he was ripping off these bands, or did the allegations of sexual misconduct play a part as well?

The sexual assault and harassment allegations weren’t made public until the Vanity Fair article in 2007, and the bands fired him around 1998–2000, so I don’t think it was driven by that.

‘N SYNC on July 25, 2000. CREDIT: AP PHOTO/KATHY WILLENS, FILE
‘N SYNC on July 25, 2000. CREDIT: AP PHOTO/KATHY WILLENS, FILE

It was really pretty simple: I think ’N Sync, at one point, was living on a $50 per diem, and they were the top-selling band in the world. Then Lou magnanimously gave them each a check for $30,000, I think, and Lance Bass tore his up on the spot. The fact that Lou hadn’t told the Backstreet Boys he was starting ’N Sync and he didn’t tell ’N Sync he was the manager of the Backstreet Boys, there was bad blood from the get-go. I think they just eventually tired of it and sued. And I think he got a lot of money in the settlements, too, but they did get free of him.

I can understand how Lou could’ve started ’N Sync without the Backstreet Boys knowing.* But how did no one in ’N Sync’s camp know that Lou was already managing this other boy band?

I think the adults knew. It was Justin Timberlake’s mother, Lynn Harless, who must have known, because she and Lou were pretty close. And she was the one that called Lou when Justin parted ways with Disney and said that he was available. So I’m sure she knew, and maybe some of the ’N Sync guys knew, but they kept it quiet. It does seem real that the Backstreet Boys didn’t know. And if you talk to Kevin Richardson, who seems like a very moral, upright guy, he seems very shocked and stunned, that Lou could’ve done something like that.

*Pearlman went behind the Backstreet Boys’… back… to create ‘N Sync. As Pearlman told Seabrook in 2014, “My feeling was, where there’s McDonald’s, there’s Burger King, and where there’s Coke there’s Pepsi, and where there’s Backstreet Boys there’s going to be someone else. Someone’s going to have it; why not us?”

Although it’s obviously infuriating for both bands to know their manager is managing their rival, it seems fair to assume neither band would have been as successful without the other.

Yeah, I think you could certainly make that case. The Backstreet Boys’ next album, Millennium, was at the time the best-selling album of all time, and No Strings Attached was number two. And of course, as the world now knows, there’s an even larger appetite for boy bands. Simon Cowell’s whole career was essentially based on boy bands; One Direction is the latest iteration of that, and they’re bigger than ever. So I think maybe the Backstreet Boys didn’t realize just how popular the genre was going to be and remain.

“People really trusted him and he totally abused their trust… There are a lot of people who were not in the music business, who were just investors of Lou’s, a lot of elderly people in Florida who lost their life’s savings. He preyed on old women and he was kind of a monster.”

You can’t discount the fact that Disney was involved in this stuff before Lou got involved — at least in the case of Justin Timberlake and Britney, there was a kind of a symbiotic relationship between the Disney people who were maturing out of the Mickey Mouse Club, and then there was Uncle Lou, waiting to snap them up and put them in a group. It is amazing how so many of these kids who went through Disney — that group of Mousekeeters that also had Christina Aguilera, Ryan Gosling, Keri Russell, along with Justin and Britney — and now you’ve got Selena Gomez and Demi Lovato. This is all what Lou wrought, a little bit, and Disney wrought it too.

Some of Lou’s less impressive acts. L: Ashley Parker Angel of O-Town on July 29, 2002. R: LFO on April 10, 2000. CREDIT: STAR MAX VIA AP IMAGES
Some of Lou’s less impressive acts. L: Ashley Parker Angel of O-Town on July 29, 2002. R: LFO on April 10, 2000. CREDIT: STAR MAX VIA AP IMAGES

There’s a moment in The Song Machine describing when Britney goes to audition for Epic — before she sees Jive — and she does her thing, and the guy says, “This isn’t a singer, this person doesn’t have a great vocal range, what am I listening to this for? I’m looking for a real artist.” And then Jive signs her, and it was probably the worst decision that guy ever made. There was some shift: The people at the top of the labels who just kind of realized that if you took somebody who was really hungry and a teenager and raw and you could completely control and create in the image you wanted them to be, that that, ultimately, was a better play than looking for some incredible talent out there in a nightclub somewhere. There was a definite change in the whole music business, and it seemed to happen in the mid-to-late ‘90s… And Lou was instrumental. Whether that’s a good thing or not, Lou is at the start of that.

How new was this concept that Lou built these bands on: That you could be the architect of one, instead of waiting for five talented people to organically find each other?

When you think about pop vocal groups, you think about black R&B groups like the Temptations, and that’s where this notion of five guys singing together, all with different vocal ranges, and they harmonize, that creates this beautiful sound. Maybe, ultimately, it goes back to religious singing. It’s got that gospel element to it. Those groups, they weren’t wholly organically formed. The Temptations members were swapped out by Motown and new people came in, and that was true of other R&B groups as well.

But I’ve never heard of anyone before Maurice Starr, who did it with New Edition, who put together a group of people that was just because of the whim of that person, or the genius of that person. New Edition was a very significant group because it was a black group, and Bobby Brown was the leader, but it had this modern, MTV look. There was a lot of slick dance moves.

MTV’s role in this is interesting to think about, too. The reason it took so long for boy bands to catch on in the States is because it was thought that they were very square — too 1950s. People thought that was really going back in terms of sound, and in Europe — in England and Germany — there was much more of a taste for it. One of the reasons was MTV resisted the boy bands because they thought it was really square, and MTV cultivated an edgy image, even though they were essentially a Top 40 outlet. They put a lot of early emphasis on hip hop and tried to be cool, and everyone was afraid of boy bands because they seemed so deeply uncool. But MTV, eventually, with the Backstreet Boys, changed their tune.

To get a sense of Lou’s influence, what would the pop culture landscape look like right now if he’d just decided to forgo music and stay in the blimp business?

It’s a very real possibility that One Direction wouldn’t exist. It’s a possibility that American Idol wouldn’t exist. Because the other thing about Lou, we’re talking about his bands, but he also started a reality show, Making the Band, which was essentially a televised version of what he did. It went on the air in 2000, and it was the first reality show on network TV. (It aired on ABC.) There was always stuff like Star Search, these kind of lame singing contest shows, talent shows. But Lou modernized the concept with a different kind of TV, a more MTV-like presentation. I think if Lou hadn’t been distracted by all the other problems he was having in the year 2000, when things were starting to fall apart, he could have been a very significant innovator in the reality TV genre.

We certainly wouldn’t have the Backstreet Boys. We might not have Max Martin, because it was the Backstreet Boys that brought Max Martin to have his first hits, and then Britney Spears, with “…Baby One More Time,” was Max’s first number one. And it’s quite possible that the Swedes, in general, wouldn’t have the incredible success in America that they have now, which basically started with the Backstreet Boys. So it’s possible we might not have Dr. Luke, because there would have been no Max Martin for him to collaborate with.

And if those guys never became hit makers, many of your favorite songs, you probably never would have heard because they never would have been written. And a lot of artists, like Katy Perry — and even Taylor Swift, who knows where she would be without Max Martin? The world would look very different.

Do you think Lou’s criminal nature was the weakness that wrecked him or was this ability for, and love of, this kind of hustle and scamming inextricably linked to the savvy that made him so successful?

There’s obviously some kind of crossover area between a successful svengali and a con man. Not to say that you have to do something illegal to be a svengali, but there’s a lot of smoke and mirrors. There’s a lot of promotion, a lot of selling, a lot of trying to convince people something is that isn’t. So a lot of people that are successful in that realm could also be successful at criminals, if they had whatever weird lack of moral barriers that Lou lacked to make that happen.

“There are a lot of scammers in music business! It’s not a bad place to be a scammer, because the rules aren’t all that clear in a lot of areas. But there are surprisingly few big-time scammers. I can’t think of anyone bigger than Lou.”

If you look at it as a chicken and egg thing, Lou definitely had a passion for music before he became a scammer. He had this band, Flyer — he loved airplanes, lived next to Flushing Airport as a kid— and he claimed to have opened for some fairly significant acts, but I never believed that. And he claimed to have played a gig at the old Forest Hills Tennis Center, which I also don’t believe. There was a genuine love of music, I think, and there was this other thing which was, he was a scammer. Just an inveterate scammer who couldn’t stop himself from scamming people, and they kind of went hand in hand for a while. There are a lot of scammers in music business! It’s not a bad place to be a scammer, because the rules aren’t all that clear in a lot of areas. But there are surprisingly few big-time scammers. I can’t think of anyone bigger than Lou. Usually they’re smaller time, like trying to take credit for a song.

So many pop acts, though, seem to have some older, shadowy, male figure who does the dirty work that makes their success possible. Even if that doesn’t mean illegal dealings, it’s still uncomfortable. Like Joe Jackson or Matthew Knowles.

Yeah, definitely, there’s somebody that needs to do the dirty work. There’s a lot of dirty work to be done. I also think it’s significant that Lou represented himself as a father figure, and had the guys call him Big Poppa. Kevin Richardson said in an interview that he lost his father at an early age and looked to Lou as a father. And a lot of the kids came out of homes where fathers weren’t around, and Lou seemed like such a fatherly guy. That was part of the whole dynamic.

You do need somebody you can really believe in and have faith in and sign your life away to, basically. That’s the thing about these pop groups, and maybe it’s harder if you’re a single female like Kesha than a five guy group, but when you sign one of these contracts, it’s like a six-album deal, and that’s essentially your whole career. So you’re taking a big leap of faith, and I guess if the guy seems like a fatherly or avuncular guy that wants the best for you, that’s what you go with.

It’s fascinating to think that someone who wants to be a pop star will put their faith in someone like Lou, who obviously did not have any of the stuff — the talent, the looks — to be a pop star himself.

You could say that about coaches, too. Look at the Olympics: That relationship is true of a lot of athletes and their coaches. You do what your coach tells you to do, and that’s how you go about trying to be the best at what you do. Of course, it’s easy to exploit, and that’s the thing that Lou did. Whether or not he did it sexually, he definitely did it financially.

“Lou always believed that he would get a second chance to come back and prove himself, to change his legacy from being a Bernie Madoff to being a David Geffen.”

People really trusted him and he totally abused their trust. Those guys actually ended up pretty good, but there are a lot of people who were not in the music business, who were just investors of Lou’s, a lot of elderly people in Florida who lost their life’s savings. He preyed on old women and he was kind of a monster.

By the time he was in prison and you spoke with him by phone, you’d already done a significant amount of research on him and talked to other people about him. Was he what you expected him to be?

He had already been transferred to Miami. My initial surprise was that he was actually in Miami, because he hadn’t been there before. And the thing with Lou is, as anyone who knows or knew him will tell you, Lou always believed that he would get a second chance to come back and prove himself, to change his legacy from being a Bernie Madoff to being a David Geffen. And he never got it. He died. And that was the thing he really feared, I think; he feared not getting that chance. But I guess he didn’t deserve that chance.

He sounded kind of heavy — he sounded like a fat person, that chesty kind of sound. And he was selling the whole time. He was being himself; he was putting a positive spin on everything. He was trying to sound upbeat and he was doing a pretty good job, but you could tell he was making an effort to do it. When he was talking about how he’ll give One Direction a run for their money if he gets out, there’s a lot of poignancy to that, and I think he felt it. But being the glad-hander and promoter that he is, he didn’t really let that in too much. He just was being Lou Pearlman, still, and that was after seven years in prison. He wasn’t going to get out until 2029.