tonight on "nightline," murder in paradise. they all left the u.s. to live in one of the most beautiful places on earth. what they didn't know was that an alleged american serial killer was about to follow them. and now, the real story about what happened next can be told. and, losing my religion. she's the woman behind "interview with a vampire." >> damn me to hell. >> i don't know any hell. >> so, why is anne rice suddenly bearing her fangs at christianity, and saying i quit. we'll ask her. plus, red alert. the dow plunges as fears spread that the worst may not be over. so, what does it mean for your

prospects? >> announcer: from the global resources of abc news, with terry moran, cynthia mcfadden and bill weir in new york city, this is "nightline," august 11th, 2010. >> good evening. >> i'm sit ya mcfadden. we begin tonight with crime. a story that started with an escape from justice in north carolina, and ended with murder on the tropical islands off the coast of central america. tonight, an american man and woman sit in a panamanian jail, accused of killing at least five american expatriots over a period of several years, steaming their cash and property. vicki mabrey unveils this sordid tale of multiple murders in paradise. >> reporter: bill, i'm from "nightline" in new york. >> how are you? >> reporter: i'm okay. did you kill those five people? >> i'm not at liberty to talk about my case. >> reporter: this is the man police say has confessed to five

murders, killing his neighbors and friends to get their property and their cash. >> everybody knew he was crazy but nobody thought he was a killer. >> reporter: sandi hodge moved here five years ago to live in paels by the sea. where did he kill her? >> right there. >> reporter: right over here? >> yes. >> reporter: she never expected what happened here. this island chain off the coast of panama is where you come to escape from the rat race, or the law. most say it's paradise. but that all changed when a couple called bill and jane cortez arrived a few years ago. >> i mean, he was loud. and big. and wild. but -- mostly everybody just kind of ignored him. >> reporter: he was known here as wild bill cortez. >> they're taxing us to death. they're removing our jobs. >> reporter: but it turns out, he was really william holbert, a

white supremacist from north carolina. >> has been destroyed for the last 100 years or so, after the civil war. >> behind your -- stop, right now! >> reporter: he was wanted in the u.s. for various crimes, including alleged real estate schemes. he and his girlfriend left the united states all together after alluding police on a high speed chase. >> going up the hill offroad, exit one. >> reporter: they arrived in panama in 2007 and quickly became a presence. he was known for his guns, his parties, and his trademark symbol, the skull and cross bones. then, americans began to disappear. first, there was michael brown, his wife and teenage son. cortez moved into their house. in 2009, bo isler, a former gallery owner from new mexico, seemed to split town all of a sudden, leaving his property behind. wild bill said he bought it.

>> and that struck me as very odd. i said, god if i would have known he was going to give the house away, we would have bought it. >> reporter: in march, yet another person went missing. this time, it was cheryl hughes, sandi's close friend. and once again, wild bill said he had bought her land. >> that was her dream home. she would never, ever sell that property. >> reporter: and did you hear that wild bill had gotten that? >> yeah, and when i heard that, i knew that something was terribly wrong. she just would not have sold that property, ever. >> reporter: five missing people with one common denominator. bill cortez. >> this man was my neighbor. i knew them for two and a half years. wild bill and his wife. >> reporter: cher and keith lived together on their piece of paradise. their own private island, just

across the water from where wild bill and jane settled in. and cheryl was really happy? >> unbelievably happy. got that little island, we said, yeah, we can die here. we can spend the rest of our days here. >> reporter: their marriage went south, and they separated. but even after, they remained in contact, until late march. >> the last three, four texts i got were just a little strange. they weren't what cher would say. and she said in the text that she met someone and she was leaving. >> reporter: keith says she now knows the messages that didn't sound like cher weren't. it was wild bill, he says, impersonating cher. keith, sandy and others tried to alert local authorities. >> i said, cheryl hughes was a very close friend of mine, something's wrong, her dogs are not with her, she would not have ever sold her ireland. >> reporter: why wouldn't the police look when you tell them, my wife is missing? >> in central america, a lot of

people come here to be missing. >> reporter: keith confronted wild bill. >> i said, show me some papers. cher would never sell before talking to me. >> reporter: police finally mounted an investigation into wild bill, after an expat blogger broke and pursued the story. and cher's concerned relatives flew to the mainland to meet with police. >> so i went to panama city with her aunt and sister. he has an ak-47 on the property. is that probable cause to execute a search warrant? and it was. >> reporter: by then, wild bill and jane, really william and laura, had fled. law enforcement caught up with them in nicaragua. laura is being held now as an accomplice to murder. armed with a warrant, police searched hacienda cortez. they asked keith to come along.

>> they found her camera, credit cards, purse. they wanted me to identify those items. the last thing i thought i'd be identifying her body coming out of a hole in the backyard. >> reporter: my god. >> yeah. horrific. >> reporter: five bodies turned up. cher hughes, bo isler. the entire brown family. in back of the house holbert allegedly bought from the browns. do you sense any remorse? >> i don't know. i tonight think so. i think he's -- he seems to be very calm. >> reporter: pan man yan police chief interviewed wild bill in jail. how did he kill them? >> he used a .38 caliber. he was saying very proudly that he shot them in the back of the neck, all the victims. >> reporter: he shot every one nf the back of the neck? >> exactly. >> reporter: shot, he says, when they weren't expecting it.

police continue searching for other victims, including missing pan man yans that worked at the properties wild bill took over. >> reporter: he picked the wrong girl. >> he had no idea how many people loved her and would care. he just got greedy and picked somebody that was special. >> reporter: the police really want to get the message out that this is a safe place, that people can still come. do you feel that? >> no. no. the police do not know what's going on. they really don't. as we talk among ourselves, we all say, yeah, you say you're sandi hodge, you owned a salon, you came from california, but how do we know? and that's how everybody feels now. we think we know one another, but no. not really. >> reporter: now, the island cher hughes loved so much is empty. >> will you go back out to the island? >> absolutely. absolutely. >> reporter: going to live there? >> absolutely. take cher's ashes and bury her

there. >> reporter: this is vicki mabrey for "nightline" in boss kas del toro, panama. >> police in costa rica are investigating a body found buried there under a concrete patio in a home believed to have been rented by holbert and reese. our thanks to vicki mabrey. when we come back, what caused anne rice to write off religion? first is fast.

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novelist anne rice became a literal legend with her vampire chronicles, receiving nearly 100 million books worldwide. she certainly is one of the most popular writer of all time, but it's not her novels that people are talking about these days. it's her decision to quit being a christian. she made her declaration on facebook, but sat down with dan harris to explain it in tonight's "faith matters." >> reporter: anne rice has never been one to mince words. when he book "interview with a vampire" was made a movie, she declared her dissaths faction with lead actor tom cruise. >> it happens to us all. >> reporter: she later changed her mind. these days from her home in california, she maintains a very active facebook page. on which she recently posted something rather incendiary. you wrote on facebook, today, i quit being a christian. i'm out. you go on to call christians, as a group, quarrelsome, hostile

and disservedly infamous. >> i did say that, yes. >> reporter: why? >> i was saying, look, when you see the persecution of gay people by the mormon church the catholic sure, i'm not part of this. when you see the oppression of women, i'm not part of it. >> reporter: rice was raised in a strict catholic household, but became an atheist at age 18 and lived that way for most of her life. in fact, her novels were written from an atheist perspective. >> the vampire was a perfect metaphor for the way i felt, like a lost soul, roaming in the darkness without god. and i poured a lot of my despair and my unhappiness and my grief for my lost faith into those books. >> reporter: in 198 98, she says she experienced a conversion. >> i knew there were things that the church taught that i would find very hard, but at the moment, i was really convinced that it would all work out.

>> reporter: for the past 12 years, she's lived as a committed catholic. she's switched to writing about christ and angels. her new book "of love and evil" comes out this fall. however, she says even though she knew she might struggle with the church's stance on social issues, she wasn't prepared for how frustrated she would become by things like the priest sex abuse scandals, the pope going to africa an condemning condoms in the fight against aids, and the church's fight against gay marriage in california. >> the toxic anger built up, the confusion built up, and i thought, i have to get out of this. i want god to be the center of my life and somehow, i'm in bed with the devil. >> reporter: that's a very strong word you use there. devil. you're saying that there is evil operating in organized religion. >> i felt like i was in bed with the devil. >> reporter: part of her frustration comes from the fact

that her son is gay. >> it causes great moral discomfort when the church is calling homosexuality gravely disordered. and when they are fighting to support prop 8, i mean, i can't emphasize how demoralizing that is to me. millions of dollars in church funds spent on persecuting these people publicly. i don't get it. i think it's wrong. i think it's evil. >> reporter: but that's calling the behavior of organized religion evil, which is incredibly strong -- >> i think the persecution of gays is evil. >> reporter: to be clear, rice says she is still a follower of christ. >> every time i read the bible, i will mark down different things. >> reporter: this is no small amount of notation here. >> that's right, yeah. >> reporter: and it's not just that dog-eared bible. she has an extensive bit of religion it will kra sure. >> you know what you're talking about. >> i know what i'm talking

about, yes. now some people would argue i don't know what they're talking about, but i do know what i'm talking about, yes. >> reporter: well put. will you miss anything about being an active catholic? >> eventually, i will probably miss the ritual, the it will tur. going to mass, going to holy communi communion. but i couldn't go anymore. i was sitting in church, in a beautiful environment with beautiful music, wanting to pray and i was too angry and too confused to be there. i had to leave. it was coming between me and god. to be in that church. and the church should be the place that helps you to get close to god. >> reporter: and you felt like it was -- >> i had to leave. >> reporter: it's obvious to me this makes you very sad. >> it does. it's tragic. but when you find yourself lying for god, something's really wrong. and for me to go on being in that church, or in any church

worrying about what they teach and what they do socially and what they might do politically that was a lie. i can't do that. >> reporter: rice says her anguish over this decision will work its way into her books. in the meantime, her announcement has generated an enormous response on blogs, in newspapers -- >> are you prepared for the possible backlash? >> reporter: and on cable tv. in a country where a growing number of people, now 17%, say they have no religion, this story has clearly touched a nefb. is it fair to paint organized religion with such a broad brush? >> i wanted to move away from all of it. i feel called to move away. i don't want to be in the dispute. >> reporter: she acknowledges there are plenty of people involved in organized religion who are doing positive things. but she says, she, like a growing number of americans, is out. where does all of this go? if so many people feel alienated from organized religion, how does this play out, do you think? >> i don't know. i did what i felt i had to do

for my conscience. but obviously this has implications. let's hope and pray something will come out of it. >> reporter: for "nightline," this is dan harris in california. >> final note. rice told dan she is incredibly surprised by the vampire craze in popular culture right now. she says she loved "true blood" on hbo and likes "twilight," too. but it, she says, is for kids. coming up, bret michaels in tonight's "play list." hi, may i help you? yes, i hear progressive has lots of discounts on car insurance. can i get in on that? are you a safe driver? yes. discount! do you own a home? yes. discount! are you going to buy online? yes! discount! isn't getting discounts great? yes! there's no discount for agreeing with me.

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>> announcer: "nightline" continues from new york city with cynthia mcfadden. >> bret michaels is many things. a hard rock legend. a reality show superstar. and even a survivor of a potentially fatal brain hemorrhage. he's rocked and rolled enough for several lifetimes. his recent lip released album "custom build" made it to the top of billboard's hard rock chart. and tonight she shares the music that shaped his list in the "nightline" play list.

♪ every rose has its thorn ♪ just like >> i'm passionate about playing music as much now as i was then. music can change you, fix your day. ♪ i want to rock and roll all night ♪ kiss's "rock and roll all night" had a huge influence on me. first time i saw kiss live was at the farm show arena in harrisburg, pennsylvania, and it was incredible, man. i everybody everyone in there, kiss, kiss, kiss, and they hit the stage, and just exploded and they came up on the risers. it was really astro no, ma'am ma'amical to me. ♪ turn into a ballroom blitz >> i saw fog hat and sweet play together at hershey park arena. that was huge. they came out doing "ballroom

blitz." we added that to our set. bar owners -- this is my first taste of the music business. they wanted people to dance. so we would make up fake song lists of music that we did of dance groups that we would do and when we got the gig we never played it. no one would book us anymore because we would play heavy rock songs a guy literally paid us to stop playing. 250 bucks. that was a lot of scratch. ♪ >> ratt came out with "round and round." it really defined the sound of that era. l.a. was incredible when we moved out there. very overwhelming. when you are from a small town and you go out to l.a., it is ten, 12,000 bands everywhere, everyone is trying to make it and the best thing about our band is, we had absolutely no money. we couldn't go get in trouble. and we lived in the back of a dry cleaner on the floor. those days are, even though we

were dirt poor, they were amazing days. ♪ drove my chevy to the levy ♪ >> one song i felt really close to was "american pie." i don't know. it was -- i could play that song well on the acoustic and i like singing along. and i hadn't revisited it in awhile. a really good story song. music, for me, being as sick as i've been lately has been a big healing source for me. even when i was sick in icu, my head was thumping, i asked them to bring muse nick there to let something play and it kind of influenced what i was going through and helped to put me in a great mood. ♪ sweet home alabama >> my daughters, a couple of nights ago, they were with me, out on stage with me singing "sweep home alabama." they know when the pyro comes, they got it down. we have a full-on studio.

we go in there, we have the drum kit set up, you know, the amps set up. we go in there and play and jam. we're a fun family. we like to have a good time. and considering everything that's happened to me lately, it's good to cherish those moments. really puts life in perspective. ♪ don't need nothing ♪ but a good time ♪ how can i resist ♪ ain't looking for nothing ♪ but a good time ♪ and it don't get better than this ♪ ♪ don't need nothing but a good time ♪ >> jimmy: tonight, jason schwartzman. i make meat balls with reed alexander. music from joanna newsom. "jimmy kimmel live" is next. ♪

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