'N Sync manager pleads guilty to fraud

Former boyband impresario Lou Pearlman has pleaded guilty to charges of conspiracy, money laundering and bank fraud.

Pearlman, who launched the careers of the Backstreet Boys and 'N Sync, is accused of lying to investors and raising more than $300 million for fake companies.

The mogul has agreed to help the investigation in exchange for a possible prison sentence reduction.

Fletcher Peacock, Pearlman's court-appointed lawyer, said: "Mr Pearlman is going to enter a plea. It's the first step in taking responsibility for what has happened."

Pearlman could face 25 years in jail and $1 million in fines. However, if he cooperates with prosecutors, bankruptcy trustees, FBI, IRS and other regulators looking to track down co-conspirators, his punishment could be less severe.

Pearlman was arrested in Guam last summer and has been in a Florida jail since July 10.

The 53-year-old's plea deal states: "For over 20 years, Louis J. Pearlman was successful in raising millions of dollars based on false representations about two companies affiliated with him. One of those companies was Transcontinental Airlines Travel Services Inc. The other was Transcontinental Airlines Inc.

"Pearlman represented to thousands of investors and several federally insured financial institutions that those two companies were successful companies in the airline business and that Pearlman's ownership interest in those companies was worth millions of dollars.

"That was not true."