News · moment 10 of 22
The ISA Ponzi Scheme Explained
from Lou Balls · #7
Audio-only archive episode — no video to seek.
4 minNews
They break down Pearlman's fraudulent Employee Investment Savings Account (ISA) scheme, which mimicked the real ERISA to trick investors like a Manhattan dentist's family into thinking it was FDIC/AIG-insured.
- 22:34Tim describes showing up as a child star to a blimp hanger in Orlando where a weird director approached him.
- 22:59The director of Snow White and the Seven Dwarfs told eight-year-old Tim he could talk to him about girls because he knew all about them.
- 24:06Pearlman ran a massive empire in southern Florida built on complex financial fraud.
- 24:22TransCon Air stock paid around 10% annual dividend in the early 90s, and Pearlman created a new investment option called the ISA.
- 24:39The ISA, or Employee Investment Savings Account, promised 8% annual returns and Pearlman claimed it was guaranteed by the FDIC, AIG, and Lloyd's of London.
- 25:00Tim explains Pearlman marketed the ISA to non-employees as a pension plan with no risk and high yield.
- 25:28A Manhattan dentist named Steven Saran and his family started investing with Pearlman in the 80s after hearing about him from someone in their Florida retirement community.
- 25:48None of the guarantees were real—the FDIC and AIG had never backed the ISA, and Lloyd's of London eventually sent Pearlman a cease-and-desist letter.
PearlmanAIGLloyd's of LondonTransCon AirJennifer ConnollyScottSnow White and Seven Dwarfs