All language subtitles for American Greed s04e03 Raffaello Follieri.eng

Live is a PNVP original.

In this episode of American Greed, 29
-year -old Raffaello Foglieri is at the

top of his game.

He's got a successful real estate
business, pulling in millions.

He's hobnobbing with world leaders.

So let's give Mr. Foglieri a big hand.

And he's found love with Hollywood A
-lister Anne Hathaway.

He had this beautiful girlfriend, $100
million.

He had all the credibility in the world.

But this Italian is about to see his
American dream fall apart when his fraud

exposed.

He wanted to live the lifestyle of the
rich and famous, but he wanted to do it

with everybody else's money.

He would not stop at anything.

And that's what makes him very
dangerous.

In 2007, Anne Hathaway is a household
name.

The actress has starred in hits like The
Princess Diary, Brokeback Mountain, and

The Devil Wears Prada.

She's a fixture on the red carpets,
dressed in the latest designer styles

polished to perfection.

And never far from her side is her
handsome boyfriend of three years,

businessman Raffaello Foglieri.

The two seem to have it all. They are
young, they are in love, and they have

money to burn.

Ruffalo and Ann were definitely living
it up at this time.

Together, they lead a first -class
lifestyle.

Private jets, yachts, five -star hotels,
fancy jewelry.

It appears to be a real -life fairy tale
for the girl who once played a princess

on the big screen.

But looks can be deceiving.

Just one year later, this image will be
shattered.

When Follieri is revealed as a con man
and a multi -million dollar fraud is

exposed.

The story of Raffaella Follieri's rise
and fall begins an ocean away in the

of Foggia in southern Italy.

Well, it's very provincial. Families
are, you know, rooted there for

generations.

In 2003, Foliere is 25 years old and
ready for more than what small town life

has to offer.

You know, Raphael is a gracious reader
and from a very early age loved

the American dream.

He buys a one -way ticket to New York
City, hoping to make a new life for

himself.

From his first arrival in New York.

Who's more this kind of classic, wide
-eyed kid from the hinterland coming to

the big city hoping to conquer it?

New York City.

Nirvana. Clearly. You can make it in New
York, you can make it anywhere.

The Italian doesn't speak much English.

With no money and no connections,
Foglieri begins to use his considerable

to make a name for himself.

He's very attractive, charismatic, to a
fault.

Very, very incredible X factor.

He had to sleep on people's sofas.

But even then, he had big ideas. He was
going to create a company. He was going

to be an entrepreneur.

Bollieri begins talking up a company
called Beauty Planet.

It will mass market hair and body
products.

Beauty Planet was an all -natural
product line.

You know, it was a very ultra -luxurious
line.

Bollieri tells potential investors that
he launched the same company in Italy

three years earlier.

He claims it was a raging success.

You would tell people it had been a
great success, but it doesn't seem to

been because Italian legal documents
show that he had bounced checks of $50

in total by the time it closed down.

Like the Italian version, this company
is a flop.

Beauty Planet is underfunded and never
gains any traction.

It really went nowhere, but he was able
to convince a few people to invest some

money in it, and I think discovered how
easy it was to get people to do that.

The young entrepreneur has momentum, but
he needs a more sustainable plan.

He had a hot new idea, and it seems to
have come from his father, Pasquale.

Polieri was raised in a staunchly
Catholic family.

Father and son see an opportunity to
parlay the family's modest Vatican

connections into a real estate business.

It's a timely strategy.

The Catholic Church is in the midst of a
crisis over the priest sex abuse

scandal and needs cash fast to settle
the claims.

The church will have to sell off
thousands of properties to raise the

At a time when real estate was really
hot, he wanted to get in and...

develop real estate and develop
properties that had previously been

Catholic Church.

Foglieri says he has an inside man at
the Vatican who could help him obtain

church properties at deeply discounted
prices.

He said that he had certain connections
with the Vatican that would allow him to

purchase properties at 20 to 25 percent
below market value.

His friend, Andrea Sodano, is the nephew
of Cardinal Angelo Sodano, the number

two man at the Vatican.

Now, Cardinal Sedano was actually the
Secretary of State, if you will, at the

Vatican. He was sort of the right -hand
guy to John Paul II.

So to have at least the ear, if not also
the help, of Cardinal Sedano's

nephew, you know, it might make things
happen.

The Vatican is one of the largest
property holders in the world.

If the plan works, it could be a gold
mine.

If Raffaello had tried to do this in
Rome, he would have just been laughed

of the room. Obviously, the Vatican
didn't need help in Italy to help sell

properties, and it probably didn't need
any help in the U .S. But across the

ocean, 3 ,000, 5 ,000 miles away, it was
a plausible story.

In 2003, Raffaello creates the Foglieri
Group and appoints himself chairman and

CEO.

His plan is simple.

Follieri will buy up church properties
on the cheap and redevelop them into

socially responsible businesses, such as
schools, community centers, and low

-income housing, before flipping them
for a profit.

It's a win -win situation for everyone.

Because he had these close ties to the
Catholic Church, he would be able to

of get in, get these deals, turn them
around, renovate them, sell them at a

price, and, you know, put his money for
good uses.

But Foglieri is broke.

He needs investors who can provide the
capital to get the business off the

ground.

It's a tough pitch for a foreigner with
no real estate experience.

It wouldn't have done for Raffaello to
present himself as sort of a middle

-class kid from southern Italy. Why
would the Vatican want to deal with

like that?

So he had to puff up the family story.

Although he's a college dropout,
Foglieri says he graduated from the

of Rome.

with degrees in law and economics.

And his failed company, Beauty Planet,
Foglieri says he sold it in Italy for

million.

His family, he claims, are wealthy real
estate developers in business for more

than three generations.

So there was this kind of image he was
trying to create as this kind of Italian

print. And at the same time, he and his
father said, oh, we have connections to

the Vatican.

While his life history is largely
fabricated, His connections to the

although tenuous, are real.

Like all con men, or at least all good
ones, there was an element of truth to

almost everything he said.

Follieri turns on the charm and wins
over investors.

As soon as he got his first couple of
hundred thousand dollars, his first

of investors, what did he spend it on?
He spent it on himself.

Follieri believed that the richer he
appears, the more people will want to

invest with him.

He moves off of his friend's couch and
into an apartment at Trump Tower.

He begins wearing designer clothes and
Chanel cologne.

He dines at New York's finest
restaurants, like Cipriani and Nobu 57.

And he continues to network and schmooze
his way into New York's upper crust.

He even got one of his investors to loan
him the guy's white Mercedes and would

drive around in it, giving people the
impression that it was his own. It was

the image. It was, you know, it was that
phrase, fake it till you make it. And

the money starts to flow in.

When American Greed returns,

Follieri's star rises even higher when
he lands Hollywood movie star Anne

Hathaway.

New York, New York.

It's the city that never sleeps.

A place where stars are born and
fortunes are made.

In 2004, 26 -year -old Italian
entrepreneur Raffaello Foglieri is

own dreams of wealth and fame.

His company, the Foglieri Group, plans
to snap up distressed church property

flip it for a profit.

Puglieri says his family connection to
the Vatican can get him below market

prices. He got a few people, pretty hard
-boiled business people in New York, to

give him several hundred thousand
dollars.

Puglieri is making a name for himself.

And soon he's caught the attention of an
up -and -comer in Hollywood, actress

Anne Hathaway.

In 2004, the pair meets through a mutual
friend.

Raffaella was set up with Anne Hathaway
on a blind date when she was only about

21. She had, of course, made The Prince
of Diaries as a teenager, and it was a

huge hit.

And she was obviously a rising star.

Anne's career is on the fast track.

She's just been cast in a promising new
role.

I'm going to be doing Ang Lee's next
movie called Brokeback Mountain.

Cool. Yeah, it's with Keith Ledger and
Jake Gyllenhaal and Michelle Williams.

Not too shabby. That's great. I'm very,
very excited.

They agreed to meet for lunch.

He was, unfortunately, about an hour
late.

And I was told she was furious.

He was full of apologies when he finally
arrived. He sent her flowers, and she

began to thaw.

He's got a great energy about him and a
charisma and an elegance about him. He's

got that sort of very inviting Italian,
suave, debonair personage, if you will.

As Anne would later tell reporters, it
was love at first sight.

Raffaello appears to be a catch.

He's handsome, successful, and deeply
religious.

Foglieri says his company is not always
looking for the greatest profit.

Instead... He hopes to make a difference
in the community.

His company will focus on philanthropy
in line with the teachings of the

Catholic Church.

I think almost certainly Raffaello would
have trotted out his Vatican real

estate project and his connections in
the first 15 minutes of speaking to Anne

at lunch.

Anne and Raffaello very quickly become a
couple.

Early on in the relationship, Poglieri
takes Anne to Rome to meet the Pope.

Just like the other tourists, Foglieri
buys a ticket to gain entry. But still,

the meeting makes an impression.

Was she impressed by that? I think as a
21 -year -old, she had to be.

They both seemed, at least at the first,
equally intoxicated with each other.

It was a volatile relationship, by all
accounts. You know, a lot of passion, a

lot of debate, a lot of breaking up and
making up.

Outwardly, Follieri is the picture of
success.

He has a famous girlfriend, a luxury
apartment in Trump Tower, and a thriving

real estate business.

But his life is built on a series of
lies.

And behind the scenes, his business is
failing.

Follieri is burning through investor
money, and so far has not snapped up a

single church property.

There was a point where he'd run through
his first investor's money, several

hundred thousand dollars.

He wasn't finding any other investors.

He wasn't managing to sell or buy any of
these church properties.

And he nearly ran out of money.

Polieri and Andrea Sodano, his inside
man at the Vatican, have been

crisscrossing the country taking
meetings with church leaders, always

highlight their ties to the Vatican.

They kind of shifted based on who he
spoke to, but he made claims about how

was the CFO of the Vatican and would
meet twice a week with the Pope when he

in Italy.

But so far, those connections are not
working, and Foglieri is not landing any

deals. Did it actually close
transactions?

Not necessarily, because he didn't close
that many transactions, but it did get

him in through the front door.

In 2004, the Boston Archdiocese is at
the heart of the sex abuse scandal.

It needs to sell more than $500 million
in properties to pay legal claims.

Follieri makes an offer to buy 12 of the
properties, but walks away with none.

And Mr. Follieri never was the high
bidder on any property.

And Follieri's bids in Manhattan are
also rejected.

He did bid on a couple of properties,
but he was never the high bidder, and so

we simply did not make a deal with him.

And we're not about to cut him a break
because he's a charismatic young man or

because some people think he might have
Vatican connections or whatever it might

be.

It's the same story in city after city.

Follieri didn't have any inside track on
the prize, and inevitably he was...

the guy giving the lowball offer.

With no new investors and his bank
account down to almost nothing, Follieri

needs a break.

Raffaello is nearly out of money. He
probably is having trouble paying his

at the Trump Tower apartment.

He's not got any other investors lined
up. The jig's about up.

Follieri may be down for the count, but
he's not out.

When American Greed returns...

Raffaello Fogliari makes friends in the
highest places and scores $100 million.

As lavish a lifestyle as you can imagine
is what he lived.

By April of 2005, Raffaello Foglieri's
company, the Foglieri Group, is

floundering. The bank account is down to
its last few dollars, and Foglieri has

not bought a single church property.

Progress was not being made in the
company.

So, you know, that was a time when deals
should have and could have been

happening, and they just were not
happening.

His dreams of wealth and success are
about to be shattered.

But ever the salesman, Foglieri
continues to network.

and eke his way into elite circles of
wealth and power.

Follieri was always looking for the next
connection and what that connection

could do for him.

Follieri seeks out a meeting with Doug
Band, former President Bill Clinton's

right -hand man.

He'd really sort of been a gatekeeper to
Clinton.

Hoping to win favor with Band, Follieri
begins tossing around the idea of making

a major donation to the Clinton
Foundation.

Raffaello leaves him with the distinct
impression that he is going to donate

about half a million dollars to the
Clinton Foundation.

It's a bold move, since Foglieri is on
the verge of bankruptcy.

But the ploy works.

He was very savvy about making the most
of these contacts and leaving most

people with the impression that he had
far more power than he did.

Band offers to meet Foglieri in person.

Also at the meeting, Bill Clinton's
personal friend and business partner,

Burkle. Burkle is a billionaire.

He is widely considered one of the
savviest investors in the country. His

Yucaipa fund has made a killing
investing largely in supermarket and

chains over the past 19 years.

Raffaello, who has been on the verge
of...

collapse with his project, who nearly
had to go back to Foggia with his tail

between his legs, instead finds himself
sitting at the Palace Hotel with Ron

Burkle. And in this meeting, Ron Burkle
and Doug Band have the distinct

impression that they are wooing
Raffaello into giving $500 ,000 to the

Foundation. And instead, at the end,
they find that they have agreed to

give money to Follieri for his Vatican
property project.

And, in fact, the consequence of that
meeting was that Ron Burkle agreed to

commit up to $105 million to Raffaello
Follieri.

Burkle agrees to a joint venture called
Follieri -Ucaipa Investments.

Burkle wasn't that naive.

What he did was set up a sort of fund,
which he, Burkle, controlled.

And he said to Fulieri, you bring us
properties, Catholic Church properties

they want to sell. We'll look at the
properties. If we like them, we'll buy

them. However, Burkle may have been
somewhat snowed. He did give

Fulieri an operating budget.

And with that, Fulieri really went to
town.

With the sudden cash infusion, Follieri
is off and running.

He sets up offices on the 10th floor at
350 Park Avenue.

His staff quickly grows to more than 15
people, including Issa Bernacco,

Follieri's personal secretary, who, in
an American Greed exclusive, is speaking

publicly for the first time.

We had times where we had very good
relationships.

At the same time, we had times with
strong confrontations.

From the outset, Follieri is a demanding
boss with a sharp temper.

You could feel kind of mistreated in a
way. He could scream,

he could yell.

A bit of a tyrant.

Very emotional, tended to fly off the
handle.

But to outsiders, Follieri presents a
different image, one of a devout and

humble Catholic.

He hires nuns to work the reception
desk, and he has an altar built in the

office where he holds regular church
services.

Almost everybody that worked there had
some religious connection that brought

them in and made them willing to take a
risk they probably would not otherwise

have taken.

Bollieri and Sedano spend months
traveling around and bidding on church

properties. But as journalist Christine
Haney discovers, Bollieri still has a

tough time closing the deals.

You would expect more to be occurring at
that time because people were just so

thirsty to do real estate deals. You
have to remember, this is 2006.

Everybody was buying real estate. You
know, money was cheap. So he had been on

20 properties and only got three. That's
not great odds at one of the easiest

times to buy real estate in U .S.
financial history.

But with $100 million in the bank from
Ron Burkle, Fulieri does close some

deals. He snaps up two churches in
Philadelphia.

Transfiguration Church for $1 .1
million, and St.

Clement Church for $1 .8 million.

And later, he buys a 78 -acre parcel in
the suburbs of Chicago.

He did win these deals, but these are
kind of difficult things to develop.

It wasn't clear to me that they were
profitable ventures.

He was looking at a property in Atlantic
City. That property was off the

boardwalk. That property had been on the
market for 25 years. If no one in 25

years had been able to make that
property profitable, how was someone who

arrived from Italy going to make it
work?

Bollieri has a lot of work to do.

But for now, he seems more consumed with
his personal life.

Raffaello's relationship with girlfriend
Anne Hathaway is really heating up.

The couple is inseparable.

And they've adopted a dog.

No, I just got a dog. You did? I did.
What kind?

She's a chocolate lab.

What's her name?

Esmeralda.

And the couple enjoys the limelight.

He was out and about. He was everywhere
in New York City.

They are often spotted on the red carpet
together or sitting front row at the

fashion shows in Rome and Milan.

But you weren't hearing about him making
money. You were hearing about him

spending money.

And with Foglieri holding the purse
strings of the Yucaipa budget, he begins

spend wildly on himself.

He was able to spend on private jets. He
was able to spend on Bermuda vacation

spots. He was able to spend on his
beautiful suits. He was able to spend on

watches. He was able to spend on
jewelry.

That money was coming from the operating
budget that Ron Burkle had given him.

Foglieri built his own entourage, hiring
a driver and a bodyguard.

Bob Donnelly, a retired criminal
investigator, spends two years working

Follieri. It was an image that he wanted
to portray, that he was important

enough that he needed a bodyguard for
protection.

He wanted to live the lifestyle of the
rich and famous, but he wanted to do it

with everybody else's money.

Follieri hands over his Trump Tower
apartment to his parents and moves

into a $37 ,000 a month duplex.

overlooking St. Patrick's Cathedral.

His only neighbor was a Saudi Arabian
prince who had his own pool in his

apartment. I mean, when you walked into
his apartment, it was just, you know,

the Italian marble floors, and it was
absolutely beautiful.

And first -class vacations for himself
and Hathaway become routine, like a

cruise around the Mediterranean on the
113 -foot yacht, the Celine Ashley.

Here, John McCain is photographed
climbing aboard in Montenegro.

And for New Year's, Foglieri charges a
jet to the Dominican Republic to dine at

Oscar de la Renta's house along with
Bill Clinton.

Rather than take, for example, a
commercial flight, you know, that was

less beneath him.

He wanted the private jet. He stayed in
the very best hotels, and then in the

best hotel, he had the best room.

Yucaipa execs are starting to get
worried. They encourage Follieri to rein

his spending to no avail.

He spent as much of it as he could on
himself and his girlfriends.

When American greed returns, Follieri's
wild spending will finally catch up to

him. It was all smoke and mirrors.

He got away with it for quite a while
until the world started caving in on

By the summer of 2006, Italian
businessman Raffaello Fogliari has

name for himself.

He's got a multi -million dollar
partnership with billionaire Ron Burkle

glamorous girlfriend by his side.

You have this beautiful girlfriend, $100
million, ties to Ron Burkle. He had all

the credibility in the world.

Anne Hathaway's latest hit, The Devil
Wears Prada, is a box office sensation.

She lent a real credibility to him, and
she did open doors because she was a

movie star. This is something that he
benefited from.

Hoping to capitalize on Anne's star
power, Foglieri invites her to sit on

board of directors of a new charity he
creates called the Foglieri Foundation.

He talked about how it was really
important to him to, you know, kind of

versus just kind of focus on the bottom
line.

Foglieri pledges to use a portion of his
proceeds to fund the new charity.

Its mission is to inoculate needy
children in third world countries.

The foundation to him was really
everything.

You know, his short -term successes were
the fact that he could actually go and

impact the life of a child.

But so far, Follieri has not turned a
profit, and he is blowing through the

operating budget.

There is also the issue that you kind of
have to make money to spend money or

you need to make money to give money
away. So that was interesting. How do

do this at the same time?

When he started the Foliere Foundation,
he didn't actually have much money to

put into it. So he just started taking
money from that operating budget without

telling Ron Burkle.

In July of 2006, Anne Hathaway and
Raffaello Foliere traveled to Nicaragua

the foundation's first mission,
inoculating 1 ,000 children.

Against hepatitis A.

If you vaccinate one child, you greatly
heighten the chance that you're bringing

immunity into their family because, as
we all know, diseases are spread very

easily amongst children.

And we're just so grateful to be given
this opportunity.

Follieri relishes in the attention he
receives for his philanthropic work.

All of this was brought to the attention
of President, ex -President Clinton.

And then Follieri makes his boldest
pledge.

$50 million to Bill Clinton's
foundation.

I would like to ask now Raffaello
Foglieri, the founder and president of

Foglieri Foundation, to come forward.

On September 21, 2006,

Bill Clinton hosts his annual global
initiative gathering in New York City

honors Raffaello Foglieri for his
humanitarian work.

This commitment is to vaccinate 10 ,000
children in Honduras.

That's a million -dollar commitment.

That is in addition to the foundation's
previous $50 million commitment.

So they've done a great job.

So let's give Mr. Follieri a big hand.

Follieri declared that he was going to
donate $50 million to the Clinton

Foundation. Well, this was terrific,
but, of course, it never came to pass.

Bollieri seems to feel invincible.

And with that, he becomes emboldened. He
systematically draws from the Yucaipa

operating budget as if it were his own
piggy bank.

As lavish a lifestyle as you can imagine
with the money he had is what he lived.

He racks up charges of more than $16
,000 at the Excelsior Hotel in Rome and

,000 at the Hotel de Russie.

He charters a jet to Las Vegas and
brings along designer Roberto Cavalli

slew of models for a weekend at the MGM
Grand.

The credit card bills ramped way up as
it got kind of worse and worse. And he,

think, tested the limit and found that
for a while at least there were no

limits. But while Foglieri is spending
wildly on himself, he's not meeting

payroll. And disgruntled employees are
beginning to feel the pinch.

Mr. Foliere was able to bring a lot of
people into the business who were devout

Roman Catholics who really wanted to
help the church and who often worked for

literally nothing at times.

After burning through his operating
funds, Foliere puts out urgent calls to

Yucaipa, saying he needs more money to
cover the payroll.

But Yucaipa has had enough.

I don't think they ever thought he was
simply stealing the money. I think

they...

He seemed to increasingly feel that he
was irresponsible and wasn't respecting

them or their money and attempted to put
tighter and tighter controls on his

finances over time.

Well, the fact is that all these
expenses were coming out of that same

budget. So by late fall of 2006, even
Ron Burkle was going,

wait a minute, this is really getting
out of control, and it was.

Foglieri is starting to feel the heat.

Yocaipa is demanding to see
documentation to substantiate many of

Foglieri was put in a position where he
had to fabricate invoices and fabricate

work products.

Behind closed doors, Foglieri orders
Issa to create the invoices.

He needs to make the invoices, and he
tells me what to write for the invoices.

So I do it.

At one point, the witness did sit him
down and literally say, we're doing

something illegal, we need to stop.

And he told her not to worry about it.
He would not stop at anything, and

that's what makes him very dangerous.

But on April 23, 2007, Follieri's wild
spending finally catches up to him.

After months of wrangling, Ron Burkle
sues Foliere for misappropriating $1 .3

million of the operating budget.

The charges include $800 ,000 for nearly
worthless engineering reports,

a six -figure loan to the foundation
that has not been repaid, and countless

personal expenses on lavish hotels,
meals, yachts, and private jets.

Foliere has charged $150 ,000 in medical
expenses, including a $30 ,000 house

call. and even used Yocaipa money to pay
for an elite dog -walking service for

Esmeralda, the couple's dog.

It seemed like Mr.

Foliere wanted everything good in life
without working for it.

For Foliere, it looks like the gig is
finally up.

When American Greed returns, things go
from bad to worse when the feds come

calling.

In the spring of 2007, Raffaello
Fogliari is under fire.

His business partner, Ron Burkle, has
sued him for misappropriating $1 .3

million. And dozens of former investors
and creditors are hounding him,

demanding their money back.

This was a very dramatic time for
Raffaello because he'd at least for a

lost the love and money of Ron Burkle.
So he desperately needed a new backer.

But Follieri is seemingly oblivious to
the storm surrounding him. In September,

he takes his girlfriend, actress Anne
Hathaway, on a seven -day cruise around

the Mediterranean aboard the 120 -foot
luxury yacht, the Sun Grider.

With paparazzi circling, the pair frolic
in the crystal blue waters, jet ski and

sunbathe.

But back in New York, Follieri's staff
has still not been paid, and the strain

is beginning to take a toll.

And he called us.

From the yacht that he was on for the

vacation. And he told us that he didn't
have any more money.

Issa Bernacco, Folieri's secretary, has
not been paid in months.

She's struggling to make ends meet.

Every single penny that I had was to
save my mortgage, save my home.

He had given me a check and the check
bounced again.

And Bob Donnelly, Polieri's bodyguard,
has been dealt a handful of worthless

checks and months of excuses.

I don't know how that could have
happened. You know, there's plenty of

that account, you know. You really get
angry. You get pissed off.

Because you see the way that he's
throwing money away on himself, but yet

doesn't pay you what you're legitimately
entitled to.

Polieri's employees are losing faith.

The Yucaipa suit has crippled business.

Employees were leaving him. He couldn't
make payroll for any of his entities.

And he was starting to max out his
credit cards.

Without Burkle footing the bill,
Follieri is forced to move out of his

apartment and into a spare bedroom at
his parents' place in Trump Tower.

Follieri was increasingly desperate at
that time.

Follieri needs a cash infusion fast and
incredibly...

He finds one in Plainfield Asset
Management, a hedge fund based in

Connecticut.

Follieri came forward as the Vatican's
guy in the States.

It had a certain power, and I think that
plus his innate charm did the trick.

Plainfield Asset Management agreed to
pay the 1 .3 to Burkle and to

pay a million or more in various...

outstanding expenses, credit card bills,
stuff like that.

So once again, it seemed, Ruffalo was up
and running.

By spring of 2008, the suit is behind
him.

But with all the negative press,
Fogliari is becoming a target, and other

creditors are descending fast.

On April 3rd, Fogliari is arrested and
hauled into jail to face misdemeanor

charges for bouncing a check.

One of his earlier investors is still
out $215 ,000.

And after months of haggling, Foglieri
wrote him a check from an account that

held just $39.

Foglieri is released on bail, but his
troubles are far from over.

This is dated in March of 2006, which is
essentially in the middle of the

conspiracy. Behind the scenes, FBI
Special Agent Ted Kachopi is covertly

building a criminal case.

It's a bit of a cliche, but at first you
follow the money. You have to find

where the money came from and find where
it went.

What he finds is a clear -cut case of
fraud.

It appeared that he was essentially
stealing investor money to live his

lifestyle. Have business cards of
managers of all the expensive

then have the expenses we could trace
back to investors reflect nightly meals

these restaurants.

If you tell an investor, I'm going to do
X, Y, Z with your money and intake the

money and then don't do that and indeed
spend the money on your dog walker and

your home, that's illegal.

Digging through Fogliari's bank records,
Kachopi uncovers all the hallmarks of a

money laundering scheme.

I've worked complicated money laundering
schemes, and Mr. Fogliari was not a

technically adept money launderer.

Fogliari had created shell companies
with names like Keatsdale and Spiral

Associates. He set up bank accounts in
Monaco, and over a period of two years,

he wired more than $2 million offshore.

He lived an extremely lavish lifestyle.
Even while he was intaking millions of

dollars and stealing it, he was running
up credit card bills even more than he

could pay off with what he was stealing.

And he wired more than $387 ,000 of
Yucaipa's money to the Vatican, hoping

win favor.

Well, certainly, you know, Yucaipa is
the largest victim in this case, but not

the only one.

Employees, creditors, and even members
of the clergy were swindled by Foglieri.

A monsignor loaned him his credit card,
and he took him for $30 ,000 at one

point. There were a lot of people who
just were kind of burned financially,

people who were embarrassed. There was
this kind of thread of embarrassment by

people who had been taken by this kind
of Italian charmer.

But with the Fed circling, Fogliari's
biggest concern appears to be planning

own 30th birthday party on the Isle of
Capri.

So confident or deluded was he.

that the main thing he was worried about
was planning his 30th birthday party,

which was going to be this great blowout
at a restaurant on Capri.

Volieri and his friend and publicist,
Melody Bonvicino, spend a weekend in

working out all the details.

Well, you know, certainly going back to
Italy and celebrating in his homeland,

his fatherland, was very important to
him, inviting his friends and his

and, you know, celebrating, even though
it was a very difficult period for him.

The party is just two weeks away, but
Follieri insists on going back to New

City. He's hoping to repair his
relationship with Anne Hathaway.

With all the bad press, the couple is on
shaky ground.

Well, how much Anne Hathaway is aware of
is a fascinating question.

She had to be aware that the foundation
was not doing what it said it should do

because she was on the board. And then
here was this civil suit that Ron Burkle

had filed. And yet she seemed to have
complete faith in him.

So was she snowed or did she just refuse
to acknowledge those

suspicions?

Finally, after weeks of strain, Anne
calls it quits.

It's a devastating loss for Foliere.

This is a woman he intended to spend the
rest of his life with, clearly.

News of the breakup becomes a tabloid
sensation, and fearing that Foliere may

a flight risk, Special Agent Ted Kachopi
decides it's time to move.

I told my prosecutor the next day that
we should go arrest this guy right away

because not only was the scam falling
apart, but his girlfriend had also

left him.

On June 24, 2008, just after 6 a .m.,
Kachopi pounds on the door of Foglieri's

parents' apartment at Trump Tower.

Arrest warrant in hand.

He appeared shocked, but I've been
arresting white -collar criminals

in New York for a number of years now,
and they're always shocked. They never

see it coming.

Kachopi searches the apartment and finds
a briefcase with $15 ,000 in cash.

and a plane ticket to Italy in
Fogliari's name, scheduled for the very

And in a safe, a letter from Cardinal
Angelo Sodano urging Fogliari to stop

claiming he has ties to the Vatican.

He did nothing but ramp up efforts to
raise funds using the Vatican

pitch after receiving this letter.

The letter reads, I do not know how this
distressing misunderstanding could have

occurred.

But it is necessary now to avoid such
confusion in the future.

I do therefore appeal to your
sensibility to be careful respecting

To me, that's the final nail in the
coffin.

But then Kachopi finds evidence
suggesting something even more ominous.

Mr. Polieri was attempting to replicate
the fraud in other countries such as

Canada and Brazil and Great Britain.

Bollieri is cuffed and led downtown
where he is charged with 12 counts of

fraud and money laundering.

His bail is set at $21 million.

Instead of celebrating on the island of
Capri, Bollieri will spend his 30th

birthday behind bars.

So the fact that Anne Hathaway's
boyfriend was arrested and taken in

and, you know, accused of being a
conman, and that was big news.

Three months later, facing mounting
evidence against him, Fogliari pleads

guilty. New York Times reporter
Christine Haney is in the courtroom.

He was kind of bone thin, and for
someone who was just kind of always

dressed, and his hair was always perfect
and flawless, it was kind of messy and

overgrown, and he looked unshaven. And
for someone who always smelled lovely,

had this smell that permeated the
courtroom.

Fogliari is sentenced to four and a half
years behind bars.

and ordered to forfeit $2 .4 million,
including 13 designer watches and 11

pieces of jewelry he had given to
Hathaway.

He had bought a lot of expensive jewelry
for his girlfriend, and she didn't seem

to want to have anything to do with
these things anyway, and did indeed turn

them over to the government.

It's a dramatic fall from grace for
Foglieri. He went to hell in a handcart

hurry. It was to nobody else's fault but
his own.

just really symbolizes this tremendous
fall from this gilded age we had in, you

know, New York City at the time. He was
at the heart of the real estate boom. He

was at the heart of the lending world.
He had a beautiful girlfriend who was an

actress. He hung out with former
presidents and duchesses, and here he is

prison scrubs, and he's skinny, and he's
unshaven. It's very tragic.

Raffaella Foglieri is behind bars at a
federal prison in Pennsylvania.

He is scheduled to be released in May of
2012.

He will be 33 years old.

He will come out of this bigger, better,
brighter, stronger, and certainly he's

a resilient young man, clearly, very
resilient.

In the end, some believe that Follieri's
own ambition and greed were his

downfall, that the fame he so
desperately sought made him a target.

If he hadn't been with Anne Hathaway,
federal prosecutors would never have

bothered him.

Those prosecutors had to know that in
busting Fulieri, it would be a big news

story, and that had to be part of the
reason they went to such lengths to

someone who was ultimately a small
potato.

I don't know if he's truly sorry for
what he did. I'm sure he's sorry he got

caught. Mr. Fulieri wanted everything
good in life without working for it. All

the evidence pointed to just pure greed.

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