>> narrator: in this episode of "american greed," scandal rocks the world of college football. >> the mighty miami hurricanes dealing with a category-5 controversy involving cash payments and prostitutes. >> narrator: meet nevin shapiro, the man who kicked off the controversy with stunning admissions of gifts to players and broken ncaa rules. >> he's a hustler. you can tell he's a hustler. >> narrator: a big-time part of the miami scene, shapiro lives a life of tropical indulgence. >> south beach is known for its nightlife, yet mr. shapiro was known as "mr. big" in south beach. >> narrator: he takes in nearly $1 billion with false promises of huge returns.

>> the truth was,= there no business. >> it was simply money in, money out. >> narrator: but the fun can't last forever. >> ponzi schemes don't have happy endings. they're not designed to have happy endings. [ whistle blows ] >> narrator: it's august 2011 in miami, florida. as day dawns on a new football season, fans of the university of miami eagerly await their team's debut. miami filmmaker billy corben directed "the u," a documentary about the team. >> in miami, it's safe to say that fans have been spoiled, in that, at the start of every new season, we've come to expect that this could be yet another national championship. >> narrator: but this year, from the university of southern california to ohio state university, scandals

have tainted college football. little do the hurricanes' loyal fans know, the real deluge is about to begin. >> it's the university of miami's worst nightmare -- the damning results of an 11-month investigation by yahoo! sports. in it, convicted ponzi schemer nevin shapiro claims he gave improper benefits to at least 72 hurricanes athletes and 7 coaches. >> narrator: the exposé makes nevin shapiro a well-known name among sports fans. but who is the man who has jeopardized the future of miami football? and how did he steal the millions that made it all possible? shapiro tells "american greed" it's a story that involves "greed, usuary, fraud, scandal, and coverups." ever the pitchman, he says, "you need 8 documentaries" to fill this story. born in april, 1969 in brooklyn,

new york, nevin shapiro moves at an early age to the city he'll make his lifelong home -- miami, florida. >> it's often said that miami is a sunny place for shady people. really, the whole state of florida is and always has been. >> narrator: shapiro is raised by his single mother and attends miami beach high school. linda jackson is an attorney who now represents some of shapiro's lenders. she also attended beach high around the same time as shapiro. >> there are people there that have a lot of money, get cars on their 16th birthday. nevin was a small guy. he didn't come from a family with money, and he tried to compensate for that. >> narrator: in miami beach, shapiro tries to prove himself based on what jackson says is the town's own formula of success. >> it's money and prestige, and nobody really cares how you got your money. >> narrator: in the years to

come, shapiro will flaunt his newfound wealth and prestige in many ways, but foremost is his association with one of his oldest interests -- sports. >> nevin was a sports fanatic [laughs] not even kind of. nevin was a sports fanatic. >> narrator: in high school, shapiro plays basketball and wrestles, but his real passion is football. growing up in miami in the 1980s, he witnesses the rise to dominance of the miami hurricanes. >> there's no question in my mind or anybody in this room's mind who's the number-one team in america. the miami hurricanes are the number-one team. >> miami in the 1980s was the outlaw town, and the university of miami hurricanes had a reputation as the outlaw team. >> narrator: even among the 'canes' extremely loyal fan base, shapiro sticks out. >> you definitely couldn't say anything bad about the hurricanes in nevin's face, in his presence. there would be problems. [ laughs ] >> narrator: shapiro attends the university of south florida, but

never manages to get his degree in his chosen field -- criminology. he reportedly leaves school after punching a referee in the face during an intramural football game. investigative reporter tim elfrink wrote about shapiro for the miami new times newspaper. >> i don't think it's a stretch, from what i've heard about nevin, to speculate that he might have some kind of napoleon complex going on. i mean, he always had an explosive temper. >> narrator: the incident on the field is not the last time shapiro's temper will get the best of him. in 1995, while trying to sneak 20 friends into a miami nightclub on his birthday, shapiro is stopped by the owner and goes berserk. >> i've heard from people who were there, who described it, just how completely unwarranted it was and how brutal and bloody it was. >> narrator: shapiro punches the club owner so hard it knocks out part of a front tooth and destroys his tear duct. to writer tim elfrink, it's a

defining moment for the con man. >> he thought he had the power and the connections to get them in this place, and when he got caught he lashed out. he lost it. >> narrator: in the years to come, shapiro will ensure he has the wealth to afford him entrée into any club in miami beach. >> you know, when nevin shapiro shows up, he walks right into the nightclub and he gets the best table and there it is, you know? that's what it was about. >> narrator: getting there is still a few years off. shapiro first dips his toes into the world of exclusivity when his mother marries a man named richard armand adam. adam eventually moves the family to a tony mansion and has a yacht, but he also has a secret. >> the first time he experienced real wealth and this real change in living, it was through a pretty sophisticated white-collar crime. >> narrator: adam will later serve time for running a complicated multimillion-dollar lending fraud. as events will show, shapiro

fails to learn the lesson that crime doesn't pay. >> it's hard to believe he didn't learn something from adam or at least get some idea of how this might work. >> narrator: when shapiro leaves college, he begins work at a grocery diverting company called atlantic wholesale in 1993. diverting involves purchasing already sold products at a low price in one place, then reselling them somewhere else at a profit. kay balbi works with shapiro on the sales floor at atlantic. >> well, he had this cute little innocent face, but there was this power behind him. it was almost like he was bigger than life. he reminded me of maybe doogie howser and arnold schwarzenegger wrapped into one. >> narrator: from the outset, shapiro already seems to have his sights set high. >> he just always looked like, you know, he was ready to close a deal. he was cocky and confident at the same time.

>> narrator: when making a sale, shapiro has more than just good deals to offer. >> he was a statistical genius, in terms of sports. he could start talking sports right away and instantly connect with that person on the other end of the phone. >> narrator: if his home life is tainted by fraud, so is the profession he finds himself in. in 1996, 36 people working for another south florida diverter, premium sales, are charged with running a massive investment scheme. michael goldberg is a fort lauderdale lawyer who represents some of shapiro's victims. he's an expert on ponzi schemes. >> i can't imagine anyone could be in the diverting industry that did not know of premium sales because it was one of the largest ponzi schemes of its time. >> narrator: it's not long before shapiro is running a scheme that follows closely in premium sales' nefarious footsteps. >> thanks to our real lack of institutional memory in miami, nevin shapiro was literally able

to pick up that scam where they left off several years later. >> narrator: next on "american greed," nevin shapiro concocts his own grocery diverting scam and uses his ill-gotten gains to finance a lavish playboy lifestyle. >> you know, he's the american dream. he's enjoying the finer things in life, and he's sharing it with the people that he cares in life, and he's sharing it with the people that he cares about.

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>> narrator: nevin shapiro grows up amidst the wealth and decadence of miami in the 1980s and '90s. at home and at work, fraud is never far away. and when it comes time to start his own scheme, it seems like he's in the perfect place. >> miami is not an old-money kind of a town. it's not like new england. it's a place where people can come in, with a name that no one knows and a lot of money and throw it around and they're instantly accepted by society at large. >> narrator: after leaving college, shapiro heads home to miami and enters the grocery diverting business in 1993. five years later, he opens his own diverting company, capitol investments usa. the company purportedly buys low-priced groceries in one market, then ships them elsewhere to be sold at a profit. paul fishman is the united states attorney for the

district of new jersey. >> there's an opportunity in that line of work, as in others, for somebody who is a savvy businessman or a businesswoman to make a pretty decent profit on the spread between what they can buy stuff for and what they can sell it for. >> narrator: shapiro pitches capitol investments as an international diverter. there's big money to be made in overseas deals, he says, but to get at the profits, he needs investor financing. >> it's a very simple story to tell the investor, something they can easily understand. >> narrator: in addition to having a story that makes sense, shapiro has another way to sweeten the deal -- he offers lenders very high interest rates, usually around 14%, for short-term bridge loans. >> the key was to offer not only the high rate of return, which was attractive, but that it also would turn around the investment very quickly. so, it gave the impression that not only was there big money to be made, but it was also fast money. >> narrator: with the returns shapiro is offering, investors

and their money come rolling in. some lenders shapiro brings in himself through connections in miami. others, including those who will eventually go to the federal bureau of investigation, hail from new jersey. but the lion's share comes to him via naples, florida. >> nevin shapiro went to naples for the same reason that bernie madoff went to palm beach and willie sutton robbed banks -- because that's where the money is. >> narrator: situated on florida's gulf coast, naples is a migratory zone for midwestern snowbirds looking for a warm place to spend their retirement. the picturesque town lies a 2-hour drive across alligator alley from miami, but it might as well be a million miles away. >> i think, if you were to take a photograph of the city of miami and then look at the negative, it would look a lot like naples. >> narrator: with a distinctly latin flare, miami is young and flashy.

naples, on the other hand, is filled with retirees and has a decidedly buttoned-down, country-club feel. an abundance of investment firms line naples' main drag, competing to help wealthy retirees grow their nest eggs. shapiro wants in on the action. but far from home and very out of his element, he needs an inside man to pitch capitol investments. >> the story told itself well, but i don't think that the flash of miami beach would sell too well in naples, directly. >> shapiro wouldn't have lasted 10 minutes with the naples community. >> narrator: in 2003, he meets the man who will grant him entrée into this world of affluence -- sydney jack williams. >> jack was one of the naples people. >> he was their neighbor. he played golf with them. he belonged to the same country club. he knew them, and he was embedded in that community. >> narrator: williams is a successful real-estate investor who hails from indianapolis,

indiana. on his company's website, he boasts of doing real estate deals across the country worth more than $1 billion. by the end of 2003, he's invested $3.5 million with shapiro. it's not long before he becomes capitol investments' main pitchman. >> jack's neighbors saw him driving fancy cars and living a very nice lifestyle. and when he told the story of how he was doing it, making money on this diverting operation in miami, it attracted his neighbors, who wanted in on the great investment. >> narrator: many of the investors williams brings in live in and around indianapolis. some are fraternity brothers from his days at ball state university in muncie, indiana. >> people considered him their friend. they trusted him. it was not like calling smith barney and saying, "i want to buy a stock." >> these are informal deals. they're pretty much done in the clubhouse after a round of golf. >> narrator: williams says that

an investment in shapiro's diversion deals is a "no-brainer." in some cases, he offers a personal guaranteeee in all, he brings in 60 investors and $307 million. in e-mails to shapiro, he refers to himself as the "bank of naples." and like a bank, williams charges fees. his friends don't know he's paid for everyone he brings in and eventually pockets $12 million in commissions. if williams brings lenders in, shapiro knows just how to keep them happy. and by 2004, the need to do just that is growing. that year, capitol investments begins operating at a loss. just why remains uncertain. shapiro's lawyer claims that, around this time, her client begins sinking money into a business deal that goes bad. shapiro tells "american greed,"

"i got robbed myself for $25 million, which started my derailment." >> i really don't know of a ponzi-scheme operator that actually just says, "i'm going into it for the ponzi." they get behind and they just can't admit that they're messing up and they double-down and then they lose on that double-down and it's over. >> narrator: in order to hide his losses, shapiro needs to bring in more and more new investors to pay off the old investors, and it seems he knows just how to do it. >> he was a charismatic guy. he could deliver a sales pitch, you know, and he could definitely reassure you that your money was safe. >> narrator: shapiro assures investors that putting their money in capitol investments is risk-free, and if his words aren't enough, he has plenty of documentation to prove it. >> there was a lot of paper, serious paper, legitimate-looking paper that suggested that this business was not only real, but extraordinarily profitable. >> narrator: but it's all fake.

>> making up financial statements nowadays is not an awful lot harder than a click of a mouse. [ mouse clicks ] >> narrator: shapiro has his accountant and his cfo -- a father-and-son team made up of alejandro and roberto torres -- help him create these false documents. they put together multiple invoices showing purported deals between capitol investments and other companies that investor dollars are supposedly financing. tax filings claim that capitol investments has gross sales in 2006 of $54 million. >> that was $54 million more in sales than he actually had. the real number is zero. >> narrator: from 2005 through the end of 2009, capitol investments does no real business. but in naples and elsewhere, that doesn't keep lenders from receiving money they believe to be interest payments. >> the interest was not interest at all. the money that was being paid to investors was actually money

from other investors. it was simply money in, money out. >> narrator: capitol investments is a ponzi scheme, plain and simple. in all, shapiro will raise more than $930 million in investor funds. next on "american greed," from $9 dollars in gambling debts to more than $2 million in credit card charges, nevin shapiro uses investor cash to build a life of opulence. >> you were his guest, you can pretty much have whatever you wanted, you know? tons and tons of beautiful women. tons and tons of beautiful women. like, it was like utopia.

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no shortage of people who want in on his so-called grocery diverting deals. his lenders are happy. >> from what i'm told, they got their money to the day, to the minute, on time. >> investors who are getting paid off are satisfied investors, and satisfied investors generally don't complain. >> narrator: investors aren't the only people making money at capitol investments usa. >> he was diverting just enough of that incoming money to satisfy the demands of his investors. otherwise, he was using it just for his own personal use. >> narrator: shapiro's take eventually adds up to a cool $35 million, and he's not afraid to spend it. >> south beach is known for its nightlife, yet mr. shapiro was known as "mr. big" in south beach. >> the lifestyle that he was leading was pretty open and notoriously glamorous. >> narrator: at the center of that lifestyle is shapiro's $5-million, 5-bedroom mansion, which he buys in 2005.

sitting on biscayne bay, it's the perfect place to entertain. >> you came in and you were his guest, you can pretty much have whatever you wanted, you know? tons and tons of beautiful women. like, it was like utopia. [ laughs ] >> narrator: outside the mansion, shapiro parks a mercedes s65 amg, on which he makes a monthly payment of $4,700. >> and i have to admit that when i actually saw that in the draft-charging documents, i thought it was a mistake 'cause i didn't know you could lease a car for $4,700 a month. >> narrator: on the weekend, there's a dock that's just right for tying up his 58-foot, $1.5-million yacht. >> he was almost living the stereotype of miami wealth -- the rich playboy in south beach that, you know, maybe goes all the way back to "miami vice." >> narrator: the same year he buys his mansion, shapiro also picks up a condo in the bahamas.

he invests $7 million in a north carolina golf course, and he blows through cash like a man obsessed. he pays credit card bills for himself, his mother, and his girlfriend that amount to more than $2.2 million. on top of this, he shells out more than $100,000 a year for courtside seats to watch the miami heat. it's here that he sits near the team's resident entertainer, dj irie, and rubs elbows with miami's a-list. >> prominent business people, politicians -- you name it. he would usually know who's around him and say, "what's up?" and if he didn't, by the end of the game, he knew them. [ hip-hop music playing ] >> narrator: a world-renowned turntablist, dj irie is a fixture on the south beach nightlife scene. >> on the left here is mansion nightclub where they just do these huge, massive celebrity-driven parties. singers, rappers, actors,

actresses, huge sports figures -- you name it. nevin would actually come to mansion -- at one point, he was there almost like every weekend. he would have, you know, one of the best areas in the club. no matter what club he went to, he would have one of the best areas 'cause the clubs all knew that when nevin's there, he's gonna spend money. nevin had achieved unparalleled access, you know, and he had the kind of access that not many other people had. >> narrator: shapiro also obtains access to the a-list celebrities that not many other people meet. it's reported that he entertains miami heat star dwyane wade on his yacht. he also has a picture of shaquille o'neal holding him above his head and reportedly gives the heat's star player a pair of diamond-encrusted handcuffs as a gift. not quite 40, shapiro has the keys to the kingdom. >> he's the american dream, you

know? he's made it, he's enjoying the finer things in life, and he's sharing it with the people that he cares about. >> narrator: one recipient of shapiro's largesse is the athletics program at his beloved university of miami. inside the hecht athletic center, the con artist gets his name on the nevin shapiro student athlete lounge. he becomes a golden cane and gives $130,000 to the school's athletics program. documentary filmmaker billy corben reads from the inscription on a plaque that once hung inside. >> "despite the fact that he attended college outside of miami, his heart has always bled green and orange. for the tremendous philanthropic support he provides, the university of miami is proud to name the student athlete lounge after nevin shapiro." what kind of message does that send not only to the student athletes, but the athletic director, the head coaches, the assistant coaches, about the kind of access that this man has bought and has been granted?

>> narrator: shapiro's philanthropy is on display in one famous picture of the school's president, donna shalala, accepting a $50,000 check from him. >> the old saying is "as long as the champagne is flowing and the checks are clearing, nobody asks any questions." >> narrator: but shapiro's checks come with a price. >> he was someone who felt like that his contributions to the university gave him the right to have a lot of control and be able to associate with whoever and whenever he wanted. >> narrator: it's not until his ponzi scheme unravels that the depth of his association with miami's athletes and coaches is revealed. for now though, potential investors see shapiro as the embodiment of success. >> they see that you're living a high life, that you seem to be successful, and they start to equate that with the credibility of the investment itself. >> narrator: amidst all the flaunting, there is one way shapiro spends money that the

public doesn't see. >> he liked to bet, and he didn't do all that well. >> my sources who were pretty close to nevin told me that most weekends he would bet $25,000 apiece on several different games, you know, and sometimes more than that. >> narrator: shapiro's own lawyer will later tally his gambling losses at $9 million. >> that may have been fueling the scheme, too, just this constant need for new cash to keep paying his debts and keep gambling. >> narrator: despite his less than stellar track record, shapiro will later say some investors look to him for betting tips. and why not? he seems to be a guy who can't lose. in 2008, money from investors is flooding into shapiro's company and going straight back out as supposed interest payments. that year he moves a whopping $616 million into and out of capitol investment's bank account. he says that when his accountant

sees the numbers, she responds with three simple words -- "what the [bleep]" next on "american greed," the global economy rumbles, and the foundation of shapiro's fraud begins to crack. >> ponzi schemes don't have happy endings. they're not designed to have happy endings. they're not designed to have happy endings.

>> narrator: it's the end of 2008. across the country, financial tides are turning, and the biggest ponzi scheme ever is revealed. >> welcome back. it is official. the u.s. economy is in recession. >> the word is that the street remains at this moment shell-shocked. >> you have a lot of wealthy investors who thought they had $50 million in net worth, most of it with madoff. they wake up today to realize they have no money. >> narrator: for miami's nevin shapiro, the end is drawing near. >> people were starting to question, "well, if the economy is collapsing, how can my investment be doing well?" >> when the economy goes bad, when credit is harder to get, when people have less money to spend, ponzi schemes tend to fall apart faster because it's harder for the people who are perpetrating them to maintain the facade. >> narrator: as the financial system implodes, questions arise, and shapiro does not have the money to pay his lenders. he is, in part, a victim of his own lavish lifestyle.

>> he was so heavily leveraged and was spending the money so fast that only one investor, who said, "hey, give me my money back right now," caused this to start to unravel. >> narrator: at first, shapiro falls behind in making so-called interest payments. as 2008 turns into 2009, investors begin to ask questions, and shapiro offers a litany of excuses. >> his accountant was on vacation, and he couldn't get the paperwork done. >> it was a bookkeeping error, and they'd send the check right out. >> "we didn't get paid from the company that was supposed to pay us for the delivery of goods." >> people heard different things at different times. >> narrator: shapiro's smooth-talking works temporarily, and lenders allow him to delay payments. the con man uses the time he buys to try to find new money, but no one is willing to pony up. >> he just stopped being able to pay off his investors, and eventually investors started to complain. >> narrator: from naples to indianapolis, investors start to

wonder if their money is tied up in a ponzi scheme. when they ask shapiro for their money back, they're met with more stalling. by june, legal threats are heading shapiro's way. the man at the helm of capitol investments starts making desperate moves. in july, he begins selling off jewelry. the next month, he gives one investor the keys to his condo in the bahamas. but nothing can stave off the inevitable. >> the problem with a ponzi scheme is there's really not an exit strategy. eventually it has to come to a halt. >> narrator: in november 2009, a group of lenders file papers in miami, forcing shapiro's company into bankruptcy. in the words of the trustee, the capitol investments scheme comes to a screeching halt. eventually, creditors will claim that shapiro owes them more than $120 million. by now though, his problems

extend far beyond the question of how to pay creditors back. prior to the bankruptcy, an unidentified investor from new jersey goes to the fbi in newark, saying he's lost $500,000. >> word started to spread among investors with capitol investments that the fbi in newark were conducting an investigation. so very quickly, it went from a $500,000 loss to almost a $32-million loss. >> narrator: agents from the fbi, led by michael ward, and the irs criminal investigation division, led by victor lessoff, get to work. >> he was just saying, "invest this in the deal. yeah, you made 17%. how would you like to reinvest it and do it again?" and many of them were. >> narrator: they dig into the reams of paper backing up shapiro's claims that capitol investments was a going concern. a key piece of evidence comes in the form of invoices that shapiro created with his cfo and accountant, father and son roberto and alejandro torres.

>> capitol investments apparently created a false invoice with a real company's name on it. we were able to take those invoices back to that company, interview them, and corroborate that this, in fact, is a false invoice. >> when we look at one false invoice, that gives us rise to question whether or not there are other false invoices. and as the investigation continued, that's exactly what we found. eventually we found that there was no ongoing business concern associated with capitol investments. >> narrator: shapiro's financial house of cards is about to come tumbling down. >> i believe the first person that was interviewed was roberto torres, the chief financial officer, who immediately admitted that there is no legitimate business going on here. and in each subsequent interview we would do after that, we would receive the same story. >> narrator: eventually, agents question the man at the top of capitol investments -- nevin shapiro. after running the company for more than a decade, it seems that he's grown tired of spinning lies and deceit. >> at the first interview with nevin shapiro, he admitted that

there was no legitimate business associated with capitol investments. >> narrator: in april 2010, the miami businessman surrenders to fbi and irs agents in newark. he's charged with securities fraud and money laundering. on april 21, he makes his first appearance in court. >> mr. shapiro, you're here today for an initial appearance. can the government kindly advise the defendant what he's charged with and the potential penalties he faces? >> yes, your honor. the defendant is charged in a 2-count complaint, which alleges a broad-based scheme to defraud numerous investors of approximately $880 million. >> sir, do you understand what you are charged with and the potential penalties that you face? >> yes. >> okay. >> narrator: though he does not sound happy to find himself before a judge, shapiro reportedly tells his attorney he's glad the scheme has come to an end. months later, he pleads guilty

to one count of securities fraud and one count of money laundering. shapiro admits to running the massive ponzi scheme and using the scam to fund his big-shot lifestyle. he also admits that he used investor money to give student athletes cash and jewelry and feted them at miami restaurants and clubs. supporters of the miami hurricanes worry about the repercussions of shapiro's admissions. >> as a fan they were very distressing because no one knew what the ultimate consequence could be of this. >> narrator: when "american greed" returns, feeling alone and forsaken, shapiro tells all in an attempt to bring down the miami hurricanes. >> at the end of the day, if things aren't going his way, it's, "screw everything. "i don't care." you know? "it's about me." >> narrator: for more on nevin shapiro, visit americangreed.cnbc.com. nevin shapiro, visit americangreed.cnbc.com. we'll be right back.

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find your way home. zillow. >> narrator: in september 2010, nevin shapiro pleads guilty in new jersey to running a massive ponzi scheme. nine months later, he returns to court for sentencing. in arguing for leniency, his lawyer asks the judge to consider that her client has an immense gambling problem. she also claims that shapiro perpetrated his fraud to keep

capitol investments afloat after losing millions in a deal gone bad. the judge doesn't buy it. >> people get into debt in all sorts of ways, and there are lots of legal and responsible ways for people to deal with that. it is not an excuse, if you're in debt for whatever reason, to go out and rip people off to the tune here of $80 million or $90 million. >> narrator: the judge sentences shapiro to 20 years in prison and orders him to pay $82 million in restitution. to this day, shapiro's level of contrition is questionable. in e-mails to "american greed," he says that sometimes you are "forced to plead guilty on something that you don't believe you are guilty of." but shapiro's story doesn't end there. the con man's life has undergone a massive change. he once inhabited a palatial mansion and sat courtside at heat games.

now he makes his home in a small cell where game-time seating options are rather limited. inside, there's plenty of time to sit and think. >> you have to remember -- prison is a really lonely and depressing place, especially for, you know, the type of personality that nevin shapiro is. >> here's someone who spent a lot of money, lavished gifts on individuals, and then when he thought that, "okay, now that i'm in trouble, i need you to step up and help me," when these people failed to do that, i do think that it had an impact on him. >> narrator: facing 20 years, shapiro begins to seek revenge on those he once considered to be his friends. his most intense ire is reserved for his once-beloved university of miami. in august 2011, the bomb the hurricanes football fans feared finally drops. >> the mighty miami hurricanes dealing with a category-5 controversy involving cash payments and prostitutes that

threatens to bring down the team. >> narrator: yahoo! sports conducts a massive 8-month investigation into alleged ncaa violations involving shapiro and the university of miami. shapiro tells reporter charles robinson that over the course of 8 years, he's provided 72 college athletes, mostly from miami, with benefits that violated ncaa rules. he claims he's provided them with cash, meals, clothes, and jewelry. he says he's partied with them at his mansion, on his yacht, and in nightclubs and strip joints. he even says he's provided prostitutes for players and in one case paid for an abortion. what's more, he accuses members of the school's athletic staff with complicity. back in miami, the story drops with a thud that's even louder than the original story of his massive ponzi scheme. >> this was the guy that was just always so cool, you know, and always just a really nice guy to me.

like, when that story broke, i was just disgusted. i was absolutely disgusted. >> narrator: some hurricanes fans, like billy corben, choose to downplay the report. corben says shapiro's photos prove nothing. >> it appeared to me that the yahoo! sports writers did a 11-month extensive investigation of university of miami students' facebook pictures. >> narrator: but yahoo! says they've corroborated shapiro's claims with other sources, as well as reams of phone and financial records. >> from what i saw, they did their homework, you know? i don't think they took what nevin was telling them at face value. >> narrator: still, many ask -- why trust a con man? >> i don't think you should draw the conclusion that simply because someone is a convicted felon, he or she shouldn't be believed. >> narrator: weeks after the story breaks, the ncaa suspends eight players for taking gifts from shapiro. the university of miami says in a statement that it is fully cooperating with the ncaa and

is conducting a joint investigation. michael ward of the fbi sees the players shapiro courted not so much as co-conspirators, but as victims. >> nevin shapiro's a manipulator. i mean, he was able to seduce investors with a promise of large dollar amounts. and then he turns those same seduction techniques, and he turns them onto 18-, 19-, 20-year-olds, offering them gifts and parties and sex. i mean, those are tools of seduction, you know, that have been used going back centuries. >> narrator: for reporter tim elfrink, shapiro's desire for revenge hearkens back to an earlier episode in his life. >> i go back to that incident when he was a young man in south beach and sucker-punched this club owner. you know, i think his instinct was to worm his way in as a power player as best he could, and when things went wrong he lashed out. >> narrator: shapiro himself says the story isn't over. he tells "american greed" that the incident with the university of miami will become

"an urban legend by the time it all shakes out." when "american greed" returns, investors wait it out to see if they'll get any of their money back. >> you have people in their 60s and 70s who are now moving in with their children because they can no longer afford their with their children because they can no longer afford their homes. we thought we'd be ready. but demand for our cocktail bitters was huge. i could feel our deadlines racing towards us. we didn't need a loan. we needed short-term funding. fast. our amex helped us fill the orders. just like that. you can't predict it, but you can be ready.

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take the free home energy checkup. honey, we need a new refrigerator. visit pge.com/checkup and get started today. >> narrator: in the summer of 2011, nevin shapiro is sentenced to 20 years in prison for running a $930 million ponzi scheme. shapiro admits that the company he started in 1998,

capitol investments usa, does no real business between 2005 and 2009. but when did his fraud actually start? shapiro tells "american greed" that he was "loaded legitimately" and that he made a lot of people "a lot of money." but according to the fbi's michael ward, from the outset, fraud is hardwired into the dna of shapiro's business operations. >> now, there were periods of time where there was some legitimate business being conducted, but it was not a viable business opportunity in that they were paying out returns to investors that far exceeded the legitimate business income that could be generated. >> narrator: in 2011, shapiro's accountant and his cfo, a father and son named alejandro and roberto torres, also plead guilty to one count each of securities fraud. they are both sentenced to four years in prison. then, in september 2011,

sydney "jack" williams pleads guilty to filing a false tax return. he admits he failed to declare $6.4 million in commissions shapiro paid him for signing up investors. he's sentenced to a year in prison. to this day, no one can say just how much williams, who had his own money invested in the scam, knew about the ponzi. >> it's hard to believe that he did not know that it was a ponzi scheme at some point. >> i don't necessarily know that he knew it was a ponzi scheme. could he have put his head in the sand? sure. >> narrator: for many, the con has taken a heavy toll. >> you have people in their 60s 70s who are now moving in with their children because they can no longer afford their homes. >> they were retired. they were ready to live out the years out there, and now they're destitute, they're broke. >> people are out $82 million. and that's money that they may never get back. >> narrator: one investor in indiana writes the bankruptcy judge, saying he lost his life

savings, $190,000. he says he's now sick, broke, and facing foreclosure. the bankruptcy trustee continues his attempt to get back money for this victim and others. so far, he's recovered $19 million, including $130,000 that shapiro donated to the university of miami. in addition, the university has also agreed to pay back $83,000 for money shapiro gave directly to current and former athletes. the challenge of recovering more continues. the trouble is compounded by the spent at strip clubs. so those are just lost assets. >> narrator: meanwhile, the ncaa continues to investigate shapiro's involvement with the university of miami. the con man sits in a cell in louisiana.

to those who were taken by shapiro, a question remains -- why did the fraudster do what he did? >> if i had to boil it down into one word, i believe that nevin shapiro's primary motivation was greed. >> i think he was the kind of guy that was ultimately more interested in the power and prestige than he was in the money. >> i don't know what motivated him, but in the end, whatever risks he decided to run, whatever calculations he decided to make, it turned out to be a really bad bet for him. >> narrator: in miami beach, shapiro's wealth and free spending once opened every door. but after the scam and the yahoo! sports investigation through which shapiro attempted to bring down "the u," the con man is no longer king. >> in the core of nevin shapiro, he's someone that looks out for himself. and at the end of the day, if things aren't going his way, it's, "screw everything. i don't care. it's about me." you know? and that's not the nevin that you know? and that's not the nevin that i thought i knew.

>> narrator: in this episode of "american greed"... carlos perez-olivo, a lawyer with a silver tongue... >> he had a gift -- his voice, his diction. he was an actor. >> narrator: ...and solid-gold taste. >> even though i made a lot of money, i spent a lot of money. >> narrator: but when he's disbarred for fleecing desperate clients, he finds another way to make money... >> oh, my goodness. he's really that greedy. >> narrator: ...and proves that greed really is a deadly sin. >> you have a disbarred lawyer. you have a slain wife. you have a mistress. you have a life insurance policy. just an unbelievably gripping saga.