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Seated at a booth in an upscale Phoenix eatery, TV pitchman Don Lapre is arranging packets of Equal on the table to demonstrate a new wealth-building company he’s preparing to launch. Each packet of the sugar substitute is a stock market share, and Lapre — a boyish 35-year-old wearing jeans and a short-sleeved Adidas jersey — is the investor.
“You’ve heard of day trading,” says Lapre, who is armed with two cell phones. “Well, I’m creating a way to play the stock market at night. You know, for people who work all day and don’t have time during normal business hours. It’s called night trading. You’ll see me on TV with this in eight months.”
The spiel is convincing, because Lapre is a good salesman. He has reaped millions over the past decade hawking get-rich schemes on late-night cable TV infomercials. Lapre, whose earnest pitch once was parodied by David Spade on Saturday Night Live, has peddled everything from money-making secrets to 900 numbers to Web site services. Now he's even figured out a way for the average cretin to net $4,000 daily by night-trading on the stock market. Lapre is a money-making machine.
There's just one glitch. Last summer Lapre's empire went bankrupt when he rolled out a new ad campaign and it "bombed like an Edsel," as one consultant put it.
Lapre was Icarus incarnate.
A speculative real estate deal in Puerto Vallarta went south. Profits, once a reported $60 million per annum, took a nose dive. On June 29, the get-rich guru filed for Chapter 11 bankruptcy and began to reorganize his five-company realm. His filing listed assets of $9 million and liabilities of $12.5 million.
A tearful Lapre addressed his staff, telling them that he was tempted to shoot himself.
Six months later, Lapre's on the Better Business Bureau's bad apple list and a frequent target of consumer-advocacy columns in newspapers nationwide. Customers allege Lapre himself is the primary beneficiary of his money-making schemes. Some have spent thousands on Lapre's programs, and they want their money back. Former employees are clamoring to get paid. Creditors are frothing at the mouth.
None of these details bothers Lapre, however, who's focusing his energies on yet another wealth-building concept.
"I just want to have fun creating ideas and selling them," Lapre says. "I wish I had a big ego, but I really don't give a rat's ass about what people think about me."
Don Lapre (pronounced la-PREE) grew up poor in Sunnyslope. His mother worked at a U-Totem, and his father, who was laid up for two years with back trouble, owned a house-painting business. One of five kids, Lapre is proud of the times he helped make ends meet by gathering cast-off furniture in alleys and selling it down at the Park 'N' Swap.
"I've seen the pain and the suffering and the poor side of the world," he says.
A credit shy of graduating from Sunnyslope High School -- a full-time job pulled him away from his studies -- Lapre hired on with his father's company in 1988. He soon launched his own enterprise, a dating service called the 1828 Club.
Around that time, Lapre met Sally Redondo, who would become his partner in business and marriage and mother of their two children. With $110 in their pockets, and no money for wedding rings, Sally and Don drove to Las Vegas to get married. When they returned to Phoenix, Don told his bride he was $35,000 in debt. Just two months after the dating service opened, Lapre declared Chapter 7 bankruptcy.
Lapre says he rebounded with a successful business, painting houses.
"Any normal guy would have been crippled by a lack of confidence," Lapre says. "But I was too naive to be negative."
Capitalizing on their own experience as debtors, the Lapres in 1990 opened a credit repair business called Unknown Concepts, offering credit cards, cash loans and discount vacations. Their ad read: "Visas/Mastercards/Erase bad credit/Cash loans to anyone!!"
The 148 customers who paid $37 for the package learned that the Lapres did not issue credit cards but only provided names, addresses and information about companies that offered credit cards. The discount vacation information contained in the package merely suggested the consumer check with a travel agent for last-minute discounts.
The Arizona attorney general sued the couple for violating the state Consumer Fraud Act. The Lapres were barred from participating in any credit services organization and were ordered to pay civil penalties and more than $5,000 in restitution to complainants.
That didn't stop Lapre. His next venture involved writing and selling a 36-page manual explaining how to recoup a Federal Home Association insurance refund after paying off a home mortgage. The manual cost 60 cents to make and sold for $85. Lapre placed an ad in the Tribuneand claims he was soon making more than $1,000 a day.
A friend set up Lapre with a 900 number. Over the course of a year, Lapre placed 1,100 ads in newspapers across the country advertising $2.99-per-minute 900 lines. He says he began raking in $50,000 per week.
Don Lapre was white hot.
In 1992, Lapre stepped into the bright lights of television infomercials, an industry that generates more than $500 million a year in product sales. Alongside exquisite models endorsing miracle diets and exercise equipment that requires no effort, celebrities plugging anti-baldness remedies and psychic healing and chefs raving about must-have kitchen aids, Lapre preached the gospel of prosperity on The Making Money Show With Don Lapre. He told viewers how anyone could easily earn $50,000 a month with a 900-number business.