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They had come 50 or so of his victims to watch the sentencing. Just this once, just today, Nov. 20, 1998, they wanted to see the smirk of prosperity wiped off the face of the felonious grifter from the fine Virginia family. But Hugh Francis Rollins the man they called “Doughboy” cheated them of even that. The chubby figure in a black suit and black turtleneck looked positively jaunty as he stood before the judge to explain why he’d bamboozled so many for so long.

Rollins had his hands in his pockets as the judge asked him to rise. This was unusual. For six years, he had put his hands in the pockets of hundreds of others and kept them there. The habit had now brought him before the U.S. District Court for the Eastern District of Virginia, in Alexandria.

The victims in attendance were just a handful of the 550 folks whom Rollins had ripped off in a multi-million-dollar scam that had run through the town of Bristow, Va., like a creek that had jumped its banks. Over the course of the con, it had eventually reached the District of Columbia, 40 miles away, and beyond.

There was more resignation than hatred among his former investor clients as the sentencing began. They knew they’d been had, as much by their own greed as by the slippery, impossibly lucrative offers the Doughboy had made them back when he was still rolling.

Back then, Rollins was a tough man to resist. Offering annualized returns that eventually approached 200 percent, he began by pitching relatives and close friends in the small hamlet of Bristow, where the Rollins family had been a presence since the early 1800s. He moved on to the retirement accounts of widows in Manassas and the big balances of big-city lawyers and doctors in Washington. All in all, he eventually lifted $20 million with a silky, too-good-to-be-true pitch that separated widows from their pensions, children from their inheritances, and young married couples from their dowries. One Burke, Va., couple lost all the money they had been saving for their 15-year-old son’s experimental surgery for brain cancer.

In the third-floor courtroom, Rollins’ attorney, Rodney Leffler, marshaled a feeble plea for leniency: “On behalf of Mr. Rollins, his wife, and family, I as his counsel would like to apologize to his investors, many of whom are here, hundreds of whom are not.”

Leffler pointed out that Rollins had voluntarily turned himself in. But everybody in the courtroom knew that it wasn’t a sudden burst of honesty or genuine remorse that had brought him here. Like any good con, he had known when the jig was up and cut the best deal that was left on the table.

“I know it’s hard to generate sympathy,” said Leffler. “But I would ask the court to consider that he will come out of jail a much older man.”

The farmers and fidgety couples and blue-haired old ladies sardined into the courtroom couldn’t abide his lawyer’s clucks of sympathy. There were hisses of disgust, and, for a moment, they seemed ready to rise up from their benches and beat Rollins like a piñata. But Rollins, surrounded by federal marshals, was as untouchable as the money he’d swiped.

The prosecutor, Assistant U.S. Attorney Bob Wiechering, rose and pointed out the obvious, that Rollins had acted in his own self-interest, both when he had perpetrated his crimes and when he had gotten caught. His remarks seemed to provide some solace to his victims, but then it was time to hear from Rollins himself. In the same strong, sure voice he had used to hoodwink the locals, Rollins rose to his feet and began quoting French existentialist Albert Camus. “What a fool believes, a wise man sees,” he said. “Before I was a criminal, I was simply a fool. In 1992, instead of recognizing that my business was failing, I lied to myself, then others, and especially to my wife, Laura.”

Rollins turned to look at his tearful wife dabbing her eyes in the front row behind him. He segued from Camus to a line from an old Four Tops hit about love saving the day.

Self-aggrandizing to the end, he announced with a flourish: “I intend to serve my time honorably, as a Virginia gentleman.”

This was sheer apostasy to those gathered for the sentencing. Rollins was no gentlemen—he was a common thief who had stolen first from his mother, Thelma, and then squandered at least $8 million of other people’s money on cars, clothes, furs, jewelry, art, and overseas vacations. His artifice was as old as the grift itself: paying dividends to Peter with money scammed from Paul. Just a plain-vanilla Ponzi scam that got a little out of hand.

Presiding Judge James Cacheris decided Rollins’ sense of honor could use a lengthy workout—he sentenced him to 10 years in federal prison, the most severe penalty available under the federal guidelines. He will serve at least eight-and-a-half years.

“I’ve been a judge for 17 years, and this is the biggest scam presented to this court,” Cacheris said. “Many people trusted him with their life savings, only to be devastated when they discovered it was a scam.”

Disgusted by Rollins’ hubris even as the last card was played, his former marks at least had a nice round number to contemplate. Ten years. But they dismissed the $2,000 a month he was ordered to pay in restitution when he’s released from federal prison just shy of 60 years old, which will amount to less than $4 a month for each of his 550 victims. And they didn’t hold much faith that even that pittance will ever emerge.

“If anybody’s counting on that money, they’re in a fantasy world,” said Catherine Sparkman of Alexandria, who added that her family had forked more than $300,000 over to Rollins and lost it all. “I was afraid he would get away with a few [years in prison],” she said.

She still recalled the day she found out who Rollins actually was: “He’s a really good con man. We didn’t even know that Hugh was running a scam. Then we called for our money in February and he said, ‘Haven’t you heard? It’s over. I’m a crook.’”

“To say he’s ‘a crook’ is to say that Hitler was ‘a killer,’” said Kirk DeMadaler, a software engineer who lost $175,000 to his neighbor. “The only reason I didn’t walk over to his house and stick an ax in his head is, I wanted to see the man do time. I want to see him in a cell with Bubba for the next 10 years.”

Rollins never had much in the way of substantial personal assets, but he did have the Rollins family name. To be a Rollins once meant something in Bristow. The town is basically Rollinsville. Among its few hundred residents, the local phone book lists 33 Rollinses. In 1863, Rollins’ great-great-grandfather fought in skirmishes under Confederate Gen. Robert E. Lee at the Battle of Bristow Station, beating back a larger force led by Union Gen. George Meade.

There isn’t much to Bristow these days. Aside from the White Elephant Book Nook, a post office, and a railroad crossing, there’s a clump of houses surrounded by horse stables and farms where wheat, corn, and soybeans are still grown.

There’s also the hulk of the Rollins Store, a brown cinder-block structure that closed down when the price of kerosene was 47-and-a-half cents a gallon, if the rusting roadside pump is to be believed. Inside the storefront’s dust-covered windows there’s a clutter of old hardware goods grown over with cobwebs.

Rollins’ octogenarian cousin Ralph Rollins, who lives next door to the store, answers the door but doesn’t want to talk, especially about Cousin Hugh. Mary Rollins, whose husband, Albert, is Hugh’s second cousin, says, “We are now a family on the edge, living dollar to dollar.” The couple lost $25,000. The other locals seem on the quiet side for Virginians but then, nobody likes dwelling on the local boy gone bad.

Down the road a piece, atop the hill on Linton Hall Road, sits the Rollins family home with a now-neglected putting green out back and a half-finished 1,651-square-foot addition Rollins was having built when his scam collapsed. While her husband sits in jail, Laura Rollins still lives here. Nobody answers the door, and the phone number is unlisted. A few local residents suggest looking for her at Osbourn High School, where she runs the special education program.

Investors who have been inside the house say the walls were once covered with a mix of modern and traditional African art, the bedrooms piled high with expensive designer clothes, alligator shoes, furs, and gold jewelry that inspired equal measures of envy and confidence in Rollins’ acumen as a savvy investor. Rollins knew how to cut a figure, weaving a myth of prosperity out of the house, the Versace jewelry, and the $4,000 hand-tailored Brioni suits.

A few of his investors attended the party Rollins threw at Morton’s Steak House in Tysons Corner for his 25th wedding anniversary, and the party at his home to celebrate his face lift. Many more spotted him and his wife cruising around in one of the fancy cars in his fleet his Lincoln Town Car, his Lincoln Navigator, his vintage 1939 Buick, his refurbished Alfa Romeo, or the couple’s his-and-hers convertible Jaguars.

They all knew that Rollins was living large they just didn’t know that it was on their nickel. Rollins regaled them with tales of trips to London and Hawaii. They waved bon voyage as limousines chauffeured him out to Haymarket Country Club or to the airport for golf clinics in Arizona and auto-racing school in Daytona. Members of the Bull Run Kiwanis Club, with whom he had breakfast once a week, were kept abreast of the progress made by a young professional golfer whom Rollins was sponsoring on a tour run by Jack Nicklaus for up-and-coming players.

Once he got rolling, Rollins didn’t even have to market his scam. It sold itself, leaping from mouth to mouth among the lucky ones who got in early and found themselves rolling in money. Half of his fellow Kiwanis Club members were impressed enough to give Rollins cash. “I’ll see if I can squeeze you in,” Rollins would tell them over a low-budget breakfast each Tuesday morning.

For his part, Rollins sent off a palpably prosperous vibe. He donated money locally to fund children’s baseball and football teams, while tossing $13,000 to the Levine School of Music back in Washington.

DeMadaler first met Rollins at the Yorkshire Restaurant, a greasy spoon on Route 28 in nearby Centreville. “This guy had three- and four-thousand-dollar suits,” DeMadaler says. “He had his plans for the addition to his house laid out on his living room table, and he was just so proud of how he was getting them done and this, that, and the other. A lot of people said, ‘Well, I invested with him, because what type of a person would be putting a $250,000 addition on his house when he’s going to jail?’” DeMadaler’s retrospective suspicion is dead-on, but at the time he was perfectly willing to fork over his money.

Here in Bristow, people did not see the sucker punch coming, in part because it came from such a close distance. “There are some people out there who are going to figure if Rollins, an old family friend, did it, then nobody is trustworthy in the stock market,” says one victim, who doesn’t want his name used.

It occurred to none of them, at least until they saw their life savings sink without a bubble, that Rollins had never invested their money but was blowing it all like Jed Clampett on steroids. Rollins maintains that his ostentation was the key to his con. The high-visibility lavishness helped lure investors hungry for what he had.

“We’re talking about a group of people who really wanted to believe this,” Rollins declares on videotape. “I can remember at least five instances where somebody would look me right in the eye and say, ‘Hugh, I know this is too good to be true.’ And as they were looking me right in the eye, they were writing a check out for $25,000. Some were greedy, some were opportunistic, some were simply naive, but everybody wanted to share in the glory.”

DeMadaler sees red over Rollins’ suggestion that his victims are in some way complicit in their own undoing: “When it all came down, regardless of what happened, his claim to greatness is, ‘Look at what a great con man I was. Look at what I did. Look at how good I was at manipulating people.’”

In 1919, a Bostonian named Luigi Ponzi convinced 10 friends to give him $150 each for an “investment” scheme. Ponzi promised all a hefty 50 percent return on their money—$75—within 90 days. Then he found a second set of investors, many times larger than the first, and promised them the same fistful of dollars he’d promised the original group. With the money he collected from the second set of investors, he paid the first group back their $150 dollars plus the promised $75 return.

Everything worked fine so long as each batch of investors was bigger than the previous one, whose dividends their investment served to pay. By the time Ponzi had run out of new investors, it was six months later and he had amassed a million dollars by sitting atop this investment “pyramid.” Though his scheme was declared illegal by the U.S. Supreme Court, Ponzi’s name lives on, synonomous 80 years later with the get-rich-quick scheme that sucks people in.

In the best Ponzi tradition, Rollins’ ruse was simplicity itself: Give him some money, and in no time he would give you the money back, tacking on annualized interest rates as high as 184 percent. He convinced everybody that his firm, Venture Associates, was turning right around and lending the money to cash-starved government contractors, providing bridge funds to enterprises that were then paid off by the government.

And just in case his story wasn’t sufficiently reassuring, Rollins always signed promissory notes claiming that the money was backed by a $1.3 million trust fund he had in Florida with Commercial Funding Trust, a subsidiary of Investacorp.

There were, of course, no contractors, no backing, and no underlying enterprise near or far from Bristow. There was just Rollins with his checkbook, converting funds some to investors up the line, some to himself.

Whatever the scam lacked in complexity, it made up for in number of zeros. “We don’t have a history of any [scheme] of this magnitude in the Washington area,” says Doug Bem, an inspector with the U.S. Postal Service who helped investigate the claims against Rollins.

Rollins still seems amazed by how much havoc he managed to wreak. Throughout his ordeal he has not publicly commented, but the videotape of him and his wife, made for the Association of Certified Fraud Examiners as part of his plea agreement, demonstrates that he came through his arrest and trial with denial to spare. On the tape, Rollins is dressed in one of his hand-tailored suits. Beads of sweat form on his shaved head and fog his wire-framed glasses as he explains that he never set out to become a legendary local thief and a liar.

“I did a lot of things for these people beyond just pay interest payments and so on,” Rollins sighs, casting his eyes to the heavens. “I became very much involved in their lives. And I genuinely offered them information and counsel and so on and so forth for a lot of different reasons. For better or worse, that kind of relationship just tended to make them even more convinced that I was for real. And I wasn’t doing it to be deceitful. That’s just the way I was.”

The man on camera seems truly, deeply sorry, but another picture also comes to mind the man in the ’39 Buick, cruising to the country club with other people’s money. When his wife, a tearful, wan-looking blonde, joins him on the screen, she recalls those halcyon days when money was never an issue, when everybody in Bristow was gushing about what a saint her husband was: a godsend who had moved back to his hometown to single-handedly raise the standard of living. “People used to stop me on the street,” she says. “All the time I would hear how happy they were with my husband.”

Don Sparkman, a graphic artist who in an earlier incarnation was Rollins’ business partner when the two teamed up to legitimately sell surplus paper stock, agrees that during the scam Rollins “became bigger in life. Yet he really wasn’t that flamboyant with things. I don’t think he would have instilled the confidence had he gone totally bananas with his attire and all that. Sure, it was an expensive suit, but you’d expect a guy who was making money for you to not be wearing something inexpensive. He had nice jewelry, but it wasn’t like a diamond ring with 20 carats or something that you’d look at and say, ‘Hey, look at this guy. It’s Diamond Jim Brady.’”

Rollins and his wife, the savvy local investor and the charming hometown special ed teacher, were a nice, quiet couple who tended to duck out of parties early. “‘Got to go to work,’” quotes DeMadaler. “He was a hard, hard worker.”

DeMadaler says there were small signs along the way that the scam was exacting a price from Rollins. “His face lift went along with keeping up the façade of the successful person,” he says. “And I remember looking at a book on stress that was in his living room. There must have been a phenomenal amount of stress to do this as long as he did. And it took a toll on him when he looked in the mirror.”

Rollins created a sense of urgency in investors by invoking scarcity. According to Sparkman, Rollins’ standard pitch included the caution that he didn’t know if he had “enough room left” in his account this month. “He didn’t know if he could squeeze you in,” Sparkman recalls, “but he always had plenty of room.”

Sparkman gave Rollins only a few thousand bucks, but his wife lost huge sums, and his 20-something daughter and son-in-law cracked their whole egg in Rollins’ nest. Rollins was invited to Suzanne Sparkman’s wedding, and when Rollins posed for pictures, says Sparkman, “The joke was, ‘You’d better get a good picture of Hugh now, before he disappears with all our cash.’”

The newlyweds hoped to have kids right away, but now they’re putting off their plans after losing $180,000. “Every ounce of common sense screamed this was too good to be true,” says Suzanne Sparkman’s husband, John, who agreed to be interviewed if only his first name was used. “Sometimes you just want so badly for something like this to be true that you are willing to ignore the obvious. And as you can see by the number of victims involved, this wasn’t that unusual a hope.”

Enough bells went off in DeMadaler’s mind to prompt him to follow up with references and to make a check with the local cops, but Rollins came up aces. When asked for references, Rollins would jot down four or five names at the top of his pyramid. “I had one investor who had put money in, and over the course of four or five years had taken it out and put it back in, and he’d say, ‘Hey, Hugh Rollins is a great guy. I put my kid through college on the interest rates I made from him.’ And, in fact, he had, so that was pretty convincing for people,” Rollins says on the tape.

In order to keep the pyramid from toppling, Rollins had to broaden its base beyond his circle of acquaintances in Bristow. Still, he barely broke a sweat, tacking up a few fliers in nearby Manassas. Before long, moneyed businessmen were seeking him out. As it grew, the pyramid beckoned ever greater amounts of money until it reached a level of absurdity.

“I kept sweetening the pot and sweetening the pot, and people loved it. What I did was, if people wanted to invest money with me, whether they had it in previously and they were adding to an account, or whatever, I took it. And if they wanted to take money out, I’d give it back to them. And that was it. I didn’t try to micromanage this situation,” says Rollins.

As long as the money flowed, Rollins was a saint to the people he was ripping off. Frequently, he’d check his voice mail to hear his so-called investors singing hosannas. “Clients…would say, ‘We think you’re doing a wonderful job. Keep it up. We hope you stay in business a long time. We couldn’t do such and such and blah, blah, blah without you.’ So every time you start to grow a conscience about what you were doing, something like that comes along.”

According to Jerry Eisenberg of the Securities and Exchange Commission, who took part in the probe of Rollins, the pyramid that Rollins built wasn’t the largest of its kind. Eisenberg says it fell within the “mid-range” of such schemes. But what distinguished Rollins, Eisenberg says, was durability—he maintained one of the longest-running large Ponzi schemes in stock-fraud history. All in all, he managed to collect $20 million, pay back $12 million in interest, and spend or pocket $8 million for himself.

Part of the reason total strangers who didn’t know Rollins from Charles Schwab pushed money into his hands is that the payback was immediate. Most of the investors got money back within 30 to 45 days. The scam developed a massive appetite for cash, but for six years at least, Rollins conned enough people to feed the beast.

And as the beast grew, the phone kept ringing. Rollins answered the calls with his standard pitch about cash-strapped government contractors. Every time he made it, he says, he couldn’t believe that the voice on the other end of the line believed him.

“I didn’t even know there [were] bridge loans for government contractors,” Rollins says, raising his eyebrows and shrugging his shoulders on tape. “But I invented a few things and put them into promissory notes and so on. I created a mythical trust [fund] that supposedly had a dollar and a half in it for every dollar that I owed people. Interestingly enough, for several years, people simply believed that existed and never wanted to see any evidence of it.”

While it lasted, it was as convenient as one-stop banking. “What I was successful at,” Rollins says, “is that every time I needed to pay someone an interest payment or a principal payment, miraculously I was able to come up with money just in time to do that.

“A person would call me up, and they would say, ‘My cousin Joe has been investing with you for two years, receiving excellent returns, and I’m interested. Tell me about it.’ They would often ask a question like ‘Do you have a minimum investment?’ And I would say no. I would say, ‘For the most part my parameters are, you can invest anywhere from a thousand to a hundred thousand. But I have people who have invested more than a hundred thousand and others who have invested less than a thousand. You can have it any way you want to.’”

Things first went sour for Rollins in the late ’80s, when he ventured out on his own as a businessman, walking away from a steady income as a broker at the McLean office of Baker, Watts & Co., a century-old Baltimore investment banking firm whose slogan was “We want your business; we’ll earn your trust.” In the mid-’80s, he says on the videotape, he’d met another broker at Baker, Watts Robert Hammerman. They’d both caught the scent of huge fortunes being made in the bull market on Wall Street and, in 1991, decided to strike out on their own. Hammerman would handle the financial planning, Rollins says, while he worked the investment portfolios.

The team formed CPI Financial Services and opened an office on Leesburg Pike in Vienna, doing takeover deals. “Our goal was to do big deals, larger deals,” says Rollins on the tape. “You have to remember that in the latter part of the 1980s, Wall Street was a place of fame and fortune. A lot of people got caught up in the hype of that, and I think that I personally did, too. I was sort of reading every day about people making big hits and putting mergers and acquisitions together. I had some ideas that maybe I could do this.”

Unfortunately, they weren’t very good ideas.CPI floundered in pursuit of a big score that never came. One evening, Rollins alleges on the tape, Hammerman phoned him at home with a piece of bad news: Hammerman was $35,000 in debt to somebody who was demanding repayment. Rollins claims that he immediately borrowed $35,000 from a business client on his name alone. Hammerman could not be reached for comment.

Rollins alleges that he never got his money back, but the experience taught him something more valuable: that his good name was worth money. Never much of a businessman, he became a quick study in the fine art of stringing debts along with simple interest payments, of paying Tuesday for a hamburger today.

“As time went on, I would simply go out and borrow more money, mainly from relatives,” says Rollins. “Certainly the [Rollins] name had a good reputation, and that came into play later tremendously. So I borrowed money, and it wasn’t much. I would borrow four or five thousand dollars every couple of months, whenever my expenses or the company’s expenses would exceed whatever we were making.”

His debt grew and grew, and within five years, he says, he was backstroking through red ink. “I probably had borrowed for myself, or on my own name, and re-lent to my partner close to $150,000.”

By 1992, Rollins says, they had dissolved the partnership, but Rollins was hesitant to worry his wife with details about his lack of gainful employment or his massive personal debt.

“I told myself that the way to be successful in business is to stay in business. And that’s how I saw myself. I had to stay in business. I had to stay alive. So I came home one night, but what I told her was not the truth. I told her that I felt I could do better on my own, that I had gotten all my investment back out of the company.”

Rollins was way behind, but he was off to the races. “At that point,” he says, “I might as well have been $200 million in debt. I didn’t see it that well.” So he spun a tale. “I told people that I provided bridge loans to government contractors and that’s big business in Washington to cover their start-up costs on government contracts. And that because this was somewhat venture capital, the rates of return to me were quite high, and consequently I could pass high rates of return on to my investors.”

“It looked like a chance at being able to take some money and multiply it a little bit and get out,” says Mary Ann Henderson, DeMadaler’s significant other, who signed over a self-directed IRA from her bank. “It’s easy for people to say it was our own greed, but we were just trying to get through life,” she says. “We talked to people who put their children through school on interest payments, so it looked like a good deal.”

DeMadaler says that while there was plenty of denial to go around, no one bought the lie more convincingly than Rollins himself.

“I personally hate the man,” DeMadaler says, “but the reason he was able to do this is because the greatest confidence man in the world, or the greatest thief in the world, would be one that actually believed the story he was telling. He actually believed that he was a great businessman. There was no wavering in his voice.”

After he realized that he had been nicked by Rollins, DeMadaler began reading about Ponzi schemes and the people who perpetrate them. He says Rollins fits right in.

“He had the same personality as Ponzi. They aspire to greatness even when they can’t achieve it. He was very successful in stealing from intelligent people, because he himself believed what he was saying, lock, stock, and barrel. So he worked hard every day at stealing. People steal because they don’t want to work. This man stole to be important.”

On tape, Rollins admits that he drank his own snake oil in large gulps.

“The thing you need to remember is that I never saw this as a scheme, ever, because I was so optimistic that I would be able to be successful in the legitimate ventures that I was working on that I was able to convince myself that it wasn’t a scheme. And I never looked on it as a scheme. I knew I was borrowing money under false pretenses, but that’s as far as I saw it.”

Rollins’ illusions had to survive some fairly obvious practical obstacles. He says he lost count of the number of times between 1992 and 1994 when he was “literally an hour or two away from not being able to [repay investors], and the whole thing would have fallen apart. But something happened at the last minute. A phone call from out of the blue, and I was able to bridge and cover everything. And, of course, the ability to be able to do that created a certain confidence among investors, and that’s how word spread.”

Mostly, he says, he feared the consequences of leveling with his wife. So far, he’d managed to keep her in the dark with his own private business line. While she was out teaching, he was home mugging the mail box for fresh checks.

The circle remained unbroken, at least for a time.

“In my case, there always was this feeling of obligation. If I had you as a client, the minute you signed up with me, I felt obligated to honor the terms of that contract. And if that meant getting another client to whom I also felt honored, I could block out the big picture and simply focus on the individual. But that’s how I felt inside at the time.”

When he was before the judge, Rollins explained the longevity of the rip-off by saying that he had been waiting for luck to strike. The kind of luck that strikes a man who takes investor’s money, but has no investments, was left unexplained.

“I felt that any time I stopped this, I would immediately and forever close the gaps, and many people would lose money. Every day I stayed in business, something good might happen. And I convinced myself of that.”

Watching the tape, you could get the feeling that Rollins was as trapped and helpless as the people he ripped off. You could get that feeling—but then you might remember the matching Jags. Yet Rollins has an explanation for that as well: “I think a part of why one continues this deception of themselves is the idea of surrounding yourself with items of luxury, taking trips and things like that. And at that point, it was coupled with the idea that I was in so deep now that what’s another 10,000 bucks and why shouldn’t you take this trip because I’m 10 million bucks in debt and I’m probably never going to get out of this anyway. Eventually, this is going to end.”

For years, nobody, including his bankers, questioned why Rollins was endlessly churning checks in and out of Tysons National Bank. They never asked why all those checks from the same people were being deposited in his account while he was writing out checks as fast as he could to the same people. But in 1997, the bank hired a new vice president of operations, who immediately questioned Rollins about his accounts.

“I could see he was being accusatorial, but he was trying not to come across that way,” Rollins says on the tape. “He would couch it in terms of, ‘You know, banking regulations require us to know our customers, and we want to know more about you.’”

What could Rollins tell him? Soon the bank was demanding tax returns. This was the first real scrutiny and, at that point, Rollins began to obsess, constantly wondering how it would all come apart. “I felt very scared about that, because I figured I couldn’t stall him forever, and I didn’t want to go through the trouble of dummying up a whole bunch of tax returns for him, although I probably could have done it.”

The second big threat, the one that would prove to be his Waterloo, came from the IRAs he was raiding at two banks, F&M Bank of Winchester, Va., and Patriot National Bank in Fairfax. Unlike most larger banks and brokerage firms, these banks would allow their IRA customers to invest their money in anything, even if it was not negotiable, such as a secondhand deed of trust in real estate. When Rollins discovered this loophole, he prevailed on 40 or 50 of his investors to transfer their money from existing IRAs to the IRAs in banks with the laxer standards. Rollins then waltzed in to see the bank managers, presented bogus promissory notes, and left with the investors’ funds.

“I did this at two different banks over the course of six years,” he explains on the tape—until one of the banks was swallowed by a much larger financial institution. “And so we had a whole new set of people in there. And as they began to audit all of the bank’s financial records, they finally got around to auditing the IRAs. And they looked at the promissory notes that were giving people 185 percent annual interest for the first 30 days and 84 percent annual interest for the remainder of the note, and they couldn’t believe that. I had one telephone conversation with the head office in West Virginia of the acquiring bank, and obviously they didn’t take what I said to heart.”

One Monday in October 1997, Rollins deposited more than $300,000 in the bank that had been acquired, Patriot National which wasn’t unusual for him. When he went back at the end of the week to make a withdrawal, his commercial account was frozen. Over the next four or five days he held several meetings with the president and the chairman of the board of the original bank, who had remained after the acquisition. The two said they wanted to speak to someone at Investacorp, the Florida concern that appeared on Rollins’ bogus promissory notes as the holder of his fictitious $1.3 million trust account.

Rollins knew he was in deep shit: “They wanted to do a conference call. No one had ever asked to verify [the existence of the trust] in that simple way up to that point.” For five years, he had been doctoring up old stationery he had on file from his days as a legitimate broker doing business with Investacorp, a real Miami Lakes, Fla., brokerage house. “What I did was I took an old brokerage account, whited out most of the format except for the heading, typed in new things on my computer, ran a copy of that out, put in all the new information, and ran a copy of that in my Xerox machine. The margins were off, and it was pretty primitive, but no one was looking. And it continued to astound me to no end. And I lived every single day of my life in fear that somebody would ask that sort of question.”

Rollins recalls, “They gave me, like, 72 hours to provide all this detailed information. Or else. And I didn’t know what that ‘or else’ was.”

Seventy-two hours later, Rollins came back to the bank and told them not to worry. It was a big mistake, and he’d straighten it out and withdraw his accounts.

Rollins said the bankers seemed mollified. “But I [now] believe at the time they accepted that, they turned around and called the Commonwealth of Virginia State Corporation Commission. And within several weeks, an investigator was on my tail, asking me an incredible amount of information. And I knew then, that was the real beginning of the end.

“And this all coincidentally happens at a time when, frankly, this whole thing is going to collapse anyway,” Rollins says. “And I see it. So I’m in a state of panic beyond belief. There were days when my wife would go to work and I’d just walk around and have absolutely no idea what to do. It was like just being frozen in time. But I managed to get by day by day.”

When the authorities started circling, he took several trips to get his mind off of what he knew was coming. And still the calls came. Rollins said he’d dial into his voice mail remotely, only to hear an investor say, “‘I have $50,000 for you.’ That was very typical at the end. I had become a bank myself. I had become a bank for people.

“It got so bad towards the end that I couldn’t even bring myself to sit down and write the checks out,” says Rollins. “I mean, it would, like, take me all day to write out checks. And at the same time, the phone would start to ring more and more and more and more and more. And it could be anyone. It could be a new investor. It could be somebody checking up on stuff.

“I was such a horrible record-keeper that oftentimes I did a lot of things just from memory or just by looking at what I had written the previous month. I would forget that I had gotten a new client. And they would call and say, ‘Well, where’s my check? You said I’d get my check.’ And I’d say, ‘Oh, I’m sorry, I’ll get it out today.’ And it was getting towards the end where I would simply wait for people to call me and tell me that I owed them a check. And at that point I had absolutely no sense of how much money I had out.”

Rollins figured he was finished by the time an investigator from the State Corporation Commission asked to see his tax returns and the returns from his fictitious trust—”things that I could never, ever hope to contrive myself,” says Rollins. But it was impossible to break old patterns. Even his own attorney, he says, was fed a lie. “I simply told him, ‘I got this. Stall them for a while.’ Because I wasn’t ready, personally, to deal with it.”

Rollins kept up appearances, continuing to spend freely. After Christmas, finally, he came clean to Leffler, his new criminal attorney. Leffler put his head in his hands and told Rollins he didn’t even want to begin to tell him what the penalties were for $20 million in fraud. Then he advised Rollins to turn himself into the U.S. Attorney.

On Feb. 4, 1998, Rollins and Leffler sat down at a meeting for two hours with the assistant U.S. Attorney, an FBI agent, and a U.S. Postal Service inspector. Two hours into the meeting, the investigators realized that they had someone they’d been tracking for months. Postal Inspector Susan Leeds said that about a month before the Feb. 4 meeting, she’d even been out to his house. She told Rollins that investigators were 30 days from coming there with a search warrant.

Rollins had committed mail fraud by using the U.S. Postal Service for his scheme. On tape, he says that if he had to do it all again, he wouldn’t use the mail. But he’d still be up the creek: Prosecutors decided to charge him with one count of money laundering, instead. That crime carries twice the sentence.

The very same day that Rollins turned himself in, investigators swooped into his home to confiscate his records. They were out by the time his wife got home. That evening, Rollins says, choking up, he finally came clean: “I was standing up in one part of the kitchen area and she was sitting down, and I simply said, ‘Um, I’m going to prison.’ And I began to lay out the whole thing.”

On the tape, tears carve gutters through Laura Rollins’ makeup. “I just couldn’t believe it,” she says, while her husband sits next to her shaking his head. “I was in shock. And then I started asking about our own personal finances, and one by one he told me what he did. And I believe it now, but every day it’s a torture to get up and go to work.”

Rollins maintains that his wife was his victim as much as anyone. For one thing, he says, she thought he’d been paying the family taxes all along a debt she’s now saddled with as he sits in jail. Rollins says he signed her name to numerous preapproved credit cards, with $17,000 outstanding. About $50,000 worth of jewelry he bought her has been confiscated.

Worse still, as the director of special education at the local high school, she has to walk every day among the locals who may not buy her innocence. “You walk down the hall and people look at you. It’s pretty bad. But I have to work, so I have to face it every day. I certainly can go someplace else and take my retirement with me in the state of Virginia, but as far as my salary goes, if I went to another county, they would only give me seven years of experience. So it would be a big pay cut for me, and I wouldn’t be able to survive at all.”

By now, Laura Rollins has been ostracized by all but her closest friends. “I have heard people tell me that a lot of people have said, ‘How could she not know?’ And, of course, I didn’t. I came into the house every day and saw him, you know, do what he did, and never in a million years would I suspect what he was doing. I used to tell people he was the most honest person I have ever met, and I truly believed that.”

Investigators say furs and cars typically fetch about a tenth of their value at auctions. Nearly $300,000 that Rollins had in the bank remains frozen for now. But what funds are left will be distributed among the victims.

DeMadaler, meanwhile, confronted Hugh Rollins after hearing that he was crooked. “I asked him, ‘How could you do this?’ You know what he said? He said ‘Well, I don’t know. I guess I’ll let a psychiatrist tell me.’ He said, ‘I just did it.’ ‘Cause I said to him, ‘Was this a scam right from the beginning? Was this a scam from the start?’ And he looked at me, and he kind of cocked his head, and he didn’t, like, answer right away, and he kind of stuttered it out finally. He said, ‘Yeah. Yeah, it was.’”

Many of the people Rollins rolled say they are puzzled that neither Patriot National Bank nor F&M Bank is holding itself accountable for the IRAs signed over to Rollins. Henderson says that when Patriot Bank was sold to United Bankshares, the larger institution panicked. “They sent notices to all the people stating that they would no longer be trustees on these accounts and that they would have to be moved immediately.” Paulette Cross, a spokeswoman for United Bankshares, declined comment. Dixon Whitworth, president of F&M, did not return telephone calls.

Rollins is eager to share the blame with some of the financial institutions that gave him other people’s money. “He said, ‘If I were you, I would go after the bank for lack of fiduciary responsibility,’” says DeMadaler. “That was a direct quote from him. He said, ‘Those people didn’t investigate, didn’t challenge anything I ever said. They didn’t check my references. They didn’t do anything.’ He said it was the most amazing thing he’d ever seen. He said they were ‘the most totally duped people I’ve ever dealt with.’”

His victims continue to reel under the consequences of Rollins’ duplicity and their own naiveté, but they are still waiting for one last shoe to drop, waiting for a personal apology—preferably not delivered while pleading before a judge—from their former friend and investment adviser. Rollins maintains that his sorrow runs much deeper and is much more nuanced than anybody will ever be able to fathom. But for now, he says, he just isn’t up to the heavy lifting of saying he’s sorry.

“You want to say you’re sorry,” Rollins says, “but you kind of feel that’s pretty mild and weak. I’ve never been able to quite understand what to say to people. People will say to me, ‘Well, Hugh, do you have any remorse?’ and to me that’s such a silly question. The problem is, it’s hard to express it when there’s 550 people and $20 million at stake. It’s one thing to express remorse if you’ve done something against one person and you can focus all of your sorrow on that one act or that one person, but to spread it out over 550 people—I don’t know what a human being is supposed to do. I mean, I think about this every minute of every day of my life.”CP