Libby | Featured on ABC's Betrayal: Secrets and Lies

You can now watch Libby’s story on TV! Check out Betrayal: Secrets and Lies. Episodes air every Sunday at 10pm EST/9pm CST on ABC. Libby's husband wasn't just hiding secrets; he was committing crimes in her name. If you would like to share your story, you can reach out to the Betrayal Team by emailing them at [email protected] mailto:[email protected] and follow us on Instagram at @betrayalpod and @glasspodcasts. See omnystudio.com/listener https://omnystudio.com/listener for privacy information.

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  Hi, it's Andrea and we are re-releasing some of our past weekly episodes and there's a good reason why. For the last year, I have been working with ABC on turning some of your favorite episodes of Betrayal Weekly into a TV show. The show is called Betrayal, Secrets and Lies and it airs every Sunday at 10:00 PM on ABC. This week, we are re-releasing Libby Henry's story. Libby is fascinating because her story starts with something really small, a moment most of us wouldn't think twice about. She happened to be watching a TV show that made her go, "Wait, I don't actually know that much about my finances." And instead of brushing that feeling off, she talked to her husband and she started needling.

• 3:18Speaker 00

  And when she started doing that, everything unraveled. And what I admire so much about Libby is that she's turned that moment into purpose. She wants other women to know the business side of their marriages, to ask the questions, to not find themselves in the same position. And there's also something really tender about her story that stayed with me. Her engagement ring was a sapphire. I have a sapphire too. And that same symbolism of love and commitment and trust, in her case, she's having to redefine what all of that means to her. If you have not heard this story, I won't give any more away. Hearing Libby's story is amazing, but seeing it unfold is a whole new experience.

• 4:02Speaker 00

  So please check out Betrayal, Secrets and Lies on ABC and Hulu to see Libby's story and where it all unfolded. Enjoy the episode.

• 4:16Speaker 05

  I remember this so, so clearly. I was in my powder blue pajamas and I came out and I said something to him. I go, "What are you involved in? Are you being investigated by the FBI?" And he looked at me so coldly, like he never knew me. And he said, "If I go down, I'm taking you with me."

• 4:54Speaker 00

  I'm Andrea Gunning and this is Betrayal, a show about the people we trust the most and the deceptions that change everything.

• 5:04Speaker 00

  Recently, we got in touch with a group called The White Collar Wives Project. It's a support group for women who were blindsided by their husbands' financial crimes. Their mission is to help guide women through the fallout, legally, financially, and emotionally. For members, it's a place where they can feel supported and, most importantly, believed. A place where no one is asking that ever-present question,

• 5:30Speaker 05

  "You didn't know?"

• 5:32Speaker 00

  That's Libby Henry. She was one of the first members of The White Collar Wives. And like all the women in the group, she was in the dark about what her husband was really doing at work.

• 5:43Speaker 05

  I didn't say, "Oh, honey, dinner's ready. And by the way, did you commit fraud?"

• 5:49Speaker 00

  Libby grew up in Louisville, Kentucky. Or, as the locals call it,

• 5:53Speaker 05

  "Louisville." It's almost like you've got something caught in your throat. We automatically know if you're not from here if you're saying Louisville or Lewisville.

• 6:04Speaker 00

  Well, I'm not from there. So for this episode, I'm going to be saying Louisville.

• 6:10Speaker 00

  Early on, Libby knew her family wasn't like others. Her mother didn't get along with most people.

• 6:18Speaker 05

  She had an undiagnosed personality disorder. Today, they call this borderline personality disorder. But at the time, I didn't know what was wrong with her because there wasn't the Internet and nobody was talking about mental health back then.

• 6:34Speaker 00

  Because of her mom's mental illness, life at home was an emotional roller coaster.

• 6:40Speaker 05

  As I entered the ninth grade, I was pretty much trying to spend the night out all the time because she had such a problem controlling her emotions. I just tried to get away.

• 6:55Speaker 00

  She spent a lot of time at friends' houses. And by the time she graduated high school, she had one goal for her future. It was heartbreakingly simple.

• 7:06Speaker 05

  What I saw around me at my friends' houses, I wanted for myself. I just wanted to have a normal home because I didn't come from one. That was my big plan.

• 7:19Speaker 05

  That was it.

• 7:20Speaker 00

  She started college at the University of Kentucky. It's in Lexington, the horse racing capital of the world.

• 7:27Speaker 05

  Oh, gosh, Lexington, beautiful place, surrounded by these beautiful horse farms, rolling fields. When I got there, the first thing I thought is that I had some freedom.

• 7:38Speaker 00

  It was the 80s. Libby was carefree. She joined a sorority and quickly made friends.

• 7:45Speaker 05

  There were a lot of fraternity parties. They could have all these, you know, keg parties. You would go from one house to the next house. Lots of bands were always playing. That was a lot of fun.

• 7:57Speaker 00

  Her junior year, she went to the first kickoff game of the football season. And of course, it was a big party.

• 8:04Speaker 05

  My friend came up to me and said, "Do you know Ted House?"

• 8:09Speaker 00

  Ted House was in one of her history classes. He'd caught her eye before, but they didn't really know each other.

• 8:17Speaker 05

  He was undeniably good-looking, you know, that tall, dark and handsome. He was all those things. She goes, "Well, he wants to go out with you." And I'm like, oh, wow. Okay. So later that same night, he approached me and started talking to me. We started talking about the history syllabus. And I think he was nervous because talking about the history syllabus was kind of boring.

• 8:44Speaker 00

  Libby left the party underwhelmed.

• 8:47Speaker 05

  But two days later, my friend called me and she said, we need a double date. He really wants to go out with you. And I'm like, okay. And we go on a double date to this French restaurant. And he was an entirely different human being. He was charming and funny and much more relaxed.

• 9:06Speaker 00

  It was like she was really seeing him for the first time.

• 9:10Speaker 05

  I thought, gosh, this guy's so fun. Wow, you know, I like this guy. And two days after that, he asked me out again. And we just kept rolling and kept going out. And it wasn't long before we were an exclusive couple.

• 9:28Speaker 00

  Libby felt like herself around Ted. He was the first guy to make her feel that way.

• 9:33Speaker 05

  I was really comfortable with who I was with Ted. Like, I was always laughing. He liked that about me. He liked the humor.

• 9:42Speaker 00

  But it quickly became clear that she and Ted came from different backgrounds. To borrow a term from the horse world, he had pedigree. Private boarding schools, country clubs, and summer trips abroad. But he wasn't pretentious about it.

• 9:58Speaker 05

  Ted didn't seem to care that I didn't have any money. That didn't seem to bother him.

• 10:04Speaker 00

  The difference in their upbringing meant nothing. They just wanted to be together.

• 10:09Speaker 05

  The mundane things that you do by yourself that don't seem very fun are, of course, very fun when you are head over heels with someone. And we were.

• 10:21Speaker 00

  Libby felt safe when she was with Ted. He had that kind of confidence.

• 10:26Speaker 05

  He's kind of like that protector. And things were taken care of. If I was having an issue, he was Ted. He was taking care of everything. He was always that guy.

• 10:39Speaker 00

  After a few months of dating, Ted took Libby to meet his parents. They were in town for a fundraiser.

• 10:46Speaker 05

  And I didn't really realize what I walked into. They are a very politically connected family. The first time I met them, they were having a fundraiser for the governor of Indiana.

• 11:00Speaker 00

  Ted didn't really prepare her for this scene. And to be fair, he couldn't have.

• 11:06Speaker 05

  I walk in the foyer of this absolutely beautiful home. And at first, you know, you're just so nervous because I'm like, what do I have to offer in this conversation? What can I contribute? That is very intimidating for someone like me who came from the background that I came from.

• 11:27Speaker 00

  Libby tried to stay quiet, smile, and hide the run in her stockings. But above all, she wanted to make a good first impression with Ted's parents.

• 11:37Speaker 05

  I do remember wondering if Ted's mother thought, maybe I'm really not good enough for his son. But I got through it. His parents were very nice to me.

• 11:48Speaker 00

  Ted's dad was a successful businessman, and his mother was a philanthropist, a patron of the arts type. The night of the fundraiser, Libby was just herself. She made them laugh. And it turned out, that was enough for the House family.

• 12:07Speaker 00

  Pretty soon, Libby became a regular fixture at Ted's family events. They made her feel welcome.

• 12:13Speaker 05

  They never seemed ostentatious to me. They weren't people that bragged about money. They had money, but nobody was bragging about it. They were very supportive, and they were interested in me. Things just seemed so effortless with them.

• 12:30Speaker 00

  Ted's family genuinely loved being around each other.

• 12:34Speaker 05

  So you can imagine, when I'm with this family where things are so easy and there wasn't chaos. That's the word. There was no chaos. I loved them. I truly did.

• 12:47Speaker 00

  As they got more serious, she and Ted opened up about their flaws and tried to help each other grow.

• 12:54Speaker 05

  He was the kind of guy that would get really mad, but then he would be like, okay, I popped off. That was always his thing. But he does know that about himself. And I wasn't the best either because the one thing that I did not come out of my house with was coping skills.

• 13:12Speaker 05

  I came out of my house like a piece of Swiss cheese.

• 13:16Speaker 05

  I had a lot of holes.

• 13:19Speaker 00

  Ted and Libby started talking about their future. They both knew they wanted to have kids and stayed close to family.

• 13:27Speaker 05

  It was within a year, he asked me to marry him.

• 13:34Speaker 05

  He was nervous, but it wasn't some big gesture.

• 13:38Speaker 00

  He proposed in her living room with the ring behind his back. She remembers seeing his nerves. He was shaking.

• 13:46Speaker 05

  He's like, you know, I'm not really good at this, but I want you to marry me. It was sweet and I liked it.

• 13:55Speaker 00

  Ted had the ring custom made and it came with a special meaning.

• 14:01Speaker 05

  This woman named B. Roth made all three of the daughter-in-law's rings. My mother-in-law had a sapphire and diamond emerald cut. I had a sapphire and diamond marquee, but we all had the sapphire and diamond to match our mother-in-law.

• 14:24Speaker 05

  I couldn't believe that I was marrying someone like Ted, not because he came from money, but because I thought his family was so close and they seemed like a cohesive unit. It was like that dream I told you when I was young. I'm getting married and I'm gonna have that family. I remember thinking, it's all happening for me.

• 14:50Speaker 00

  Once they graduated college, Libby and Ted had a big church wedding. They both took jobs working for the state of Indiana, just over the border from Lexington.

• 15:00Speaker 05

  I worked for the Department of Insurance. He was in land and acquisition. So he would go and talk to people and they loved him. Ted could talk to anybody. I mean, he could charm anybody and they loved him.

• 15:12Speaker 00

  Ted was passionate about real estate, so he found them the perfect home. Even though they both worked, Ted's family money helped them close on that first house.

• 15:24Speaker 05

  I knew he had a trust fund because that's how we bought our first house, with his trust fund. And we're trying to make our house a home. His mother would always come over bringing gourmet goodies.

• 15:37Speaker 00

  That year, Libby got a special gift from her mother-in-law, something to symbolize their bond.

• 15:44Speaker 05

  Ted's mother had a circle pendant made for each daughter-in-law with little pearls around it. And she said, "This is a symbol of our circle, our family, and that you're in the circle."

• 16:01Speaker 00

  Within the first year of their marriage, Libby found out she was pregnant with a baby girl. For a moment, everything felt perfect.

• 16:12Speaker 05

  But in about six months, I go to the doctor and there's no heartbeat.

• 16:27Speaker 00

  The baby had died at six months. Ted and his family surrounded Libby, helping her through the grief. The doctors recommended she wait to get pregnant again, but she didn't.

• 16:38Speaker 05

  I lost that baby in May and I was pregnant again in July. And then I had a healthy baby girl at that point.

• 16:49Speaker 00

  It was a new beginning and they wanted a change of scenery to match. They started talking about returning to Louisville, Libby's hometown.

• 17:00Speaker 05

  And then Ted comes home and says, "I've got big news." And I'm like, "What kind of big news?" And he said, "Well, I've got an offer to go into the mortgage business in Louisville." So when he said, "We're moving," I was like, "Yay, you know, going home."

• 17:16Speaker 00

  With their new baby, they packed up and started over.

• 17:20Speaker 05

  And we both got full-time jobs at that point. I worked for, late for, a paging company. Pagers were the things.

• 17:31Speaker 05

  That was big technology back then. And he obviously was in the mortgage industry. He started working for a friend and he was a loan originator.

• 17:42Speaker 00

  The job came naturally to him. Before long, he started his own company, brokering mortgages.

• 17:49Speaker 05

  He liked it so much, he started his own business. They seemed to do so well. He had a lot of employees that started working for him. A lot of them he knew. There were people that we knew. And it just seemed like this was just the absolute best job. He's got friends that work for him.

• 18:08Speaker 00

  The first few years in Louisville were like a dream. Libby had the normal family she'd always wanted. The only thing that wasn't going perfectly was Libby's health. When her daughter was a toddler, Libby began having intense back pain. She needed spinal surgery, but the pain persisted. So she and Ted sat down and decided that Libby should quit her job, at least for the time being.

• 18:34Speaker 05

  Ted said, "You know, I'm making enough money. You don't need to go back to work." So I didn't. I would stay home for the next 10 years. And that was a critical mistake for me.

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• 21:09Speaker 00

  Ted's new mortgage business in Louisville was doing well enough for Libby to quit her job. That way, she could focus on her health and their daughter.

• 21:18Speaker 05

  I did everything that stay-at-home moms do, you know, kids, playdates. Everything that had to do with my daughter, you know, I was planning.

• 21:28Speaker 00

  It was Libby's job to handle their daughter's schedule, and Ted's job was to handle the finances, which he'd already been doing anyway.

• 21:36Speaker 05

  And I mean, I'm dyslexic. It affects my numbers and... Ted was like a human calculator.

• 21:42Speaker 00

  They'd been in Louisville a few years when...

• 21:45Speaker 05

  Ted came home and said that he had looked at this house in a neighborhood called Bridgepoint, which was a very nice neighborhood. And that was a big leap as far as cost of the homes.

• 21:58Speaker 00

  He wanted an upgrade, something to reflect his success. Libby started drawing up renovation plans and interior designs.

• 22:06Speaker 05

  I walked in and I redid the whole thing, the yard, you name it, I did it. Everything that I conjured up in my head, I was able to execute.

• 22:16Speaker 00

  When it was done, the house was perfect. It was going to be their forever home.

• 22:21Speaker 05

  Life seemed to be getting better and better and better.

• 22:26Speaker 05

  I never thought that money was an issue in my life at all.

• 22:36Speaker 00

  But Ted still wasn't satisfied. He wanted to become a Kentucky real estate tycoon. So he found new business partners to start another venture: flipping houses.

• 22:50Speaker 05

  Flipping homes in depressed parts of Louisville wasn't unusual back then. Because the timeframe of this is 2000, 2001, 2002, before the housing bubble burst. I mean, I knew so many people flipping houses.

• 23:08Speaker 00

  One of Ted's new business partners was a real estate consultant named Khalid.

• 23:13Speaker 05

  Khalid was a guy who grew up in a depressed part of Louisville. And Khalid had done well for himself business-wise, so they went into business together flipping homes.

• 23:27Speaker 05

  Khalid was from that area. And I think he knew a lot of people in that area, which made him a nice liaison.

• 23:35Speaker 00

  Ted and Khalid's business proved more successful than either of them imagined. The money was rolling in, and Ted really treated the family.

• 23:44Speaker 05

  We were able to do all of these things. For example, we were in Costa Rica. We were able to take our daughter to Bahamas, which was incredible. We were at Martha's Vineyard. We were doing all these things that I could have never done. I always used to think, this is great. You know, what a charmed life. I really, truly was grateful for everything.

• 24:11Speaker 05

  And then things started to change.

• 24:14Speaker 00

  Because Ted's attitude started to change. He had always been quick to anger, but as Libby shared, he was quick to calm down. This time, it was different.

• 24:26Speaker 05

  Like, he would come home increasingly irritable. But I couldn't understand why it was ongoing. And I would ask him, and he's like, oh, it's work stress. It's work stress. Then he started waking up in the middle of the night like he was in a panic. But it was every night, like clockwork, and I never could understand it. I'm like, what in the world? Why do you wake up like this? Oh, I've just got a lot on my mind.

• 24:53Speaker 05

  I just thought, OK, well, there's stress.

• 24:57Speaker 00

  She knew his job could be intense. He was always managing multiple sales and home renovations. Each had their own deadlines and expenses.

• 25:07Speaker 00

  But as the year went on, Ted's stress only mounted.

• 25:10Speaker 05

  But I kept asking, and he kept getting a little bit short with me. And I thought, gosh, what is the problem?

• 25:20Speaker 00

  Ted never shared details about his business with Libby. He kept it all inside, except for this one day in 2002. She walked into their bathroom to find Ted leaning over the sink.

• 25:32Speaker 05

  And I thought he was sick, and I said, what's wrong? And his reaction was so unusual. He actually did have tears in his eyes, and he said, "It's that effin' Khalid."

• 25:47Speaker 05

  And I said, what are we talking about? What's wrong with Khalid?

• 25:54Speaker 00

  Libby had met Khalid once or twice. He'd always been polite to her.

• 25:59Speaker 05

  He's so angry. And he's saying, you know, this effing Khalid, he screwed me over. He's gonna, he's gonna screw me. He just kept saying that over and over again. I go, I don't know what we're talking about. What are we talking about? And why are you angry with Khalid? And he said, he's gonna screw me. And he may kill you. He may kill our daughter.

• 26:24Speaker 05

  What?

• 26:26Speaker 05

  Those aren't words you expect to hear from your husband about a business associate, ever.

• 26:34Speaker 05

  I was paralyzed for a second. I felt my chest tighten up because I thought, what do you mean, kill? He's like, well, there's a business deal that's gone bad. And I don't know what that MF'er will do.

• 26:52Speaker 00

  Libby wanted to go to the police. But when she said that, Ted quickly backtracked. He shook it off and told Libby to forget he ever said anything. But that wasn't going to happen. Her mind was racing. Was Khalid really threatening her and her daughter? Why would Ted say that to her? She got in the car and left the house.

• 27:13Speaker 05

  I start crying, all that stress. I just start crying because I could not make sense of it.

• 27:19Speaker 00

  But when Libby returned home to ask more questions, Ted was gone.

• 27:24Speaker 05

  So I waited and waited and he didn't come back. Well, I gathered myself together and I thought, I'm gonna call his dad. I'm gonna call his parents. And I can still remember his mother saying they were outside by the pool. And they absorbed all that information.

• 27:43Speaker 05

  But it wasn't like they were panicked like I was.

• 27:48Speaker 00

  A little while later, Ted's mom called back. Apparently, they'd talked to Ted. And he'd given them the full story.

• 27:57Speaker 05

  And they said Teddy got a little spooked. And I thought, "A little spooked?" You know, I didn't feel satisfied with that answer. She said, "Well, Ted's realized that Khalid might not be the most savory person. He's a little bit unsavory. And he's not going to consort with him anymore or do business with him." And I said, "Well, he said kill." She goes, "He's just overreacted." I said, "This seems a lot more serious than that." And she said, "Libby, it's okay. He's not going to do business with him anymore. His dad's talked to him."

• 28:36Speaker 05

  And you know what? I believed that. Because his dad was telling me, "This businessman, stockbroker, graduate school educated man, highly respected, no-nonsense man."

• 28:52Speaker 05

  If they thought that, that was true.

• 28:57Speaker 05

  They just reassured me.

• 28:59Speaker 00

  They also advised Libby not to go around telling anyone about that conversation with Ted. She trusted his parents, but she was still unsettled.

• 29:10Speaker 05

  So that was not even a red flag. It was a red flare.

• 29:17Speaker 00

  When Ted finally came home, he didn't want to talk about it. He wouldn't talk about it. The house was filled with tension.

• 29:26Speaker 05

  And during that time, things really started to go sideways.

• 29:32Speaker 05

  Ted's moods were so awful.

• 29:37Speaker 00

  Every day, Ted was on edge. The days turned into weeks.

• 29:42Speaker 05

  So not only is he waking up at 3 o'clock in the morning, but I'm also waking up to the glow of the laptop.

• 29:53Speaker 05

  It's like he slept with that computer all the time.

• 29:59Speaker 00

  One night, Libby was home alone, watching TV, and she saw something that would change her life.

• 30:05Speaker 05

  I don't know if it was Dateline, I don't know if it was 60 Minutes, but it was a woman on TV, and her husband died. And she didn't know anything about her finances, nothing. And apparently, she owed thousands of dollars to the IRS. And of course, she's on the hook because she signed those tax returns. And she lost everything. And I was like, she is me.

• 30:33Speaker 05

  That is me.

• 30:35Speaker 00

  Since the beginning of their marriage, Ted had paid all their bills, paid off their credit cards, and managed their savings. When it came to their personal finances, she only knew what Ted told her. And as for his businesses, she was completely in the dark.

• 30:52Speaker 05

  So I went to him, and I'm like, I want a folder. And I wanted a folder that showed me what happens if he, if anything happened to him. I didn't know what would happen with the company. Would his business partner buy me out? I mean, I didn't, these were maybe even silly questions. I just didn't know anything. So when I started asking, he started pushing back.

• 31:18Speaker 05

  And I remember thinking, you know, that's not normal.

• 31:24Speaker 05

  Why is he defensive?

• 31:29Speaker 00

  The more Ted pushed back, the more insistent Libby became. She needed to know everything. She wanted hard copies.

• 31:38Speaker 05

  I mean, every time I asked, he got madder and madder and madder and madder, to the point we were having really big fights. But I'm still asking about that folder. Our arguments kept escalating because I thought, well, does he think I'm not smart enough to understand? Does he think he just needs to be controlling? And he's the one that needs to be able to do it all?

• 32:02Speaker 05

  Never would I have thought he was involved in anything that was nefarious. Never. Didn't even occur to me.

• 32:11Speaker 00

  Libby never got that folder of financial documents. Because a few weeks later, Ted sat her down and in a calm voice, he told her the truth. Or at least, a sliver of it.

• 32:24Speaker 05

  Three days before Christmas, he tells me, "We're bankrupt. We need to file bankruptcy." And I don't just mean any bankruptcy. I mean Chapter 7, complete liquidation.

• 32:40Speaker 00

  Bankrupt? Libby had spent a year begging Ted for financial transparency. The entire time, he never made any indication that they were in debt. Now, out of the blue, he told her they were bankrupt? It didn't add up.

• 32:56Speaker 05

  I thought, "That can't be right." I mean, it just can't be right. Because you have this company. You've purchased this beautiful home. We've lived this life. How would we be bankrupt? I couldn't make sense of it. And I didn't even get a good answer.

• 33:14Speaker 00

  When Ted tried to explain how it happened, it was just word salad about business deals gone bad. She needed space.

• 33:25Speaker 05

  I thought, "Something's really wrong. We really should be separated."

• 33:29Speaker 00

  She told him to move out, and he did. Before he left, he set up a meeting with a bankruptcy attorney.

• 33:36Speaker 05

  And I'm listening, but I'm still like in shock because I couldn't make sense of it. I'm like, "Well, how are we bankrupt? Like, why are we bankrupt? Where is the money?"

• 33:45Speaker 00

  He told Libby this meeting would give her answers, but it didn't. The next day, he came to her with a new plan.

• 33:55Speaker 05

  He comes back and says, "I think we could have just you file bankruptcy and not me." The house was solely in my name. I had no idea why he wanted to do that. I just knew that I was like, "You need to leave." Because I thought he wants to saddle me with all of that? And he comes out of that unscathed? It was enough for me to be like, "I'm done."

• 34:26Speaker 00

  She couldn't stay in the marriage. She wanted a divorce.

• 34:32Speaker 05

  And it was like a race down to our attorneys.

• 34:37Speaker 00

  They had both arrived at their separate attorney's offices at the same time.

• 34:42Speaker 05

  I was at my attorney's, he was at his attorney's. Well, he wanted to make sure that he was the petitioner. That was so important to Ted. He needed to feel like he's the one that was divorcing me.

• 34:57Speaker 00

  They started the process, but before any papers were signed, Ted tried to take back control.

• 35:03Speaker 05

  So as we're moving along in this divorce, I came home and he's standing in our kitchen saying, "I've called the divorce off." That's exactly how he said it. "I've called the divorce off." I'm like, "Okay, have you? You've called it off." And he said, "And I've written this letter and I want you to read it." And the letter stated

• 35:29Speaker 05

  all the things that he had done to me that were very unkind, admitting everything. And then he says, "I know you don't know anything about my business practices, but that will change. Like, I'm gonna let you in now on everything." But I still wasn't swayed by it because I thought, well, why was he resistant in the first place?

• 35:49Speaker 00

  The letter didn't change her mind. One line stood out, though. "I know you don't know anything about my business practices, but that will change." It sounded like he was finally giving her what she wanted: transparency. The only problem? He failed to mention the most important detail.

• 36:12Speaker 05

  In that letter, I should point out, he never says, "By the way, I've been committing mortgage fraud and your life's about to implode."

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• 37:06Speaker 05

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• 37:37Speaker 00

  Hi, I'm Jenna Ushkowitz. You might know me from Glee. This is At the Table, the food allergy podcast, a show about food, connection, and what it really looks like to live with food allergies. Each episode, we hear stories from real people like Daniel.

• 37:52Speaker 07

  People would always think I was lactose intolerant, so I just kind of shortened my explanation to I'm deathly allergic, in a big way that defined a lot of my childhood.

• 38:03Speaker 00

  And while there are challenges, there are moments that remind you you are not alone.

• 38:08Speaker 02

  One of the best guys that I dated, he made a point to memorize all my food allergies.

• 38:14Speaker 00

  So join us and hear their stories and more. Because living with food allergies isn't just about what you can't eat, it's about still having your seat at the table. Brought to you by Genentech and Novartis. Listen to At the Table, the food allergy podcast, on America's number one podcast network, iHeart. Follow At the Table and start listening on the free iHeartRadio app today.

• 38:37Speaker 00

  A few weeks after Libby and Ted began their divorce, Ted wanted to repair the relationship. He wrote her a letter apologizing, promising to come clean about their finances. But Libby didn't trust it. She had a hunch that Ted was still hiding something, so she decided to turn to the Louisville rumor mill. Libby knew her town well. If Ted was up to something, someone had to know.

• 39:04Speaker 05

  I would find out by a friend's husband. It was an attorney. He said that Ted was being investigated by the FBI. I was like, "What?"

• 39:18Speaker 00

  Ted was being investigated for a complex mortgage fraud scheme built on forged documents and phony buyers. Ted, Khalid, and his coworkers were all in on it.

• 39:30Speaker 05

  They found these straw buyers to buy these homes in a dilapidated area of Louisville.

• 39:37Speaker 00

  On paper, those buyers looked great. They had jobs, income, and enough credit to qualify. But none of it was real.

• 39:47Speaker 05

  They made up their employment so they didn't make the money that they said they did. So that would induce a lender to give them a loan when they shouldn't have had it in the first place.

• 40:00Speaker 00

  But in the moment, Libby didn't know any of these details. All she knew was that they were bankrupt and that her husband was being investigated by the FBI. So the next time Ted came over to the house, Libby met him in the driveway to demand answers.

• 40:18Speaker 05

  And I remember this so, so clearly. I was in my powder blue pajamas. And I came out and I said, "What are you involved in?" He knew at that point that I'm aware that something's wrong. And I said, "Are you being investigated by the FBI?"

• 40:37Speaker 05

  And he looked at me so coldly, like he never knew me. And he said, "If I go down, I'm taking you with me." I go, "You owe me more of an explanation." And he said, verbatim, "I don't owe you anything, bitch." That's what he said to me. "I don't owe you anything, bitch."

• 41:04Speaker 00

  The man she'd fallen in love with a decade ago was gone. Ted wasn't trying to protect her anymore. He was trying to pull her down right alongside him. But she wasn't about to let that happen. She made an appointment to speak with the authorities herself. A few days later, Libby found herself walking into a federal building, her heart pounding.

• 41:28Speaker 05

  And this is surreal to me. I mean, what minute I'm married, a stay-at-home mom, and the next minute I need to go and speak with the FBI? And so I get there, and there were three agents, and they're talking to me, asking me, you know, general questions.

• 41:51Speaker 00

  Libby sat there trying to recall every conversation, every detail, every red flag she ignored about her husband. She wanted to help their case and show them she was innocent. The agents left the room. Libby waited and waited.

• 42:08Speaker 05

  He comes back in, and he said, "The only thing you're guilty of is trusting your husband. That's all you're guilty of."

• 42:21Speaker 00

  While the FBI built their case, Libby still had to manage the divorce and bankruptcy filings. They short-sold the house and nearly everything they owned.

• 42:32Speaker 05

  I think my first real taste of what I would have to endure was going to the grocery store, thinking that I had money. And I shopped, you know, for an hour, went to buy the groceries, and there was no money, you know, no funds. And they had to pull my card aside. And that's embarrassing. And I could feel the sweat beating up. And that was my first indication. I was like, this is bad. There's no money.

• 43:01Speaker 00

  In a matter of weeks, she went from never having to think about money to not having enough for groceries. To make matters worse, Ted became erratic. He knew the feds were closing in on him.

• 43:15Speaker 05

  Ted got really, really unruly. He would show up at my house, hide behind a tree. It'd be like late at night, and I would sit on the back of my steps, and he would come and yell at me. He would say the oddest things to me. He would say things like, "I will never be found guilty. I will be found innocent in a court of law." And he named himself Teflon Ted, because the charges don't stick.

• 43:49Speaker 00

  But Ted's nickname didn't hold up. He was indicted, and the charges were serious. Mortgage fraud, bank fraud, wire fraud, totaling millions of dollars. Ted was one of four men named in the indictment, along with Khalid and two other men Libby had never heard of. They'd been inflating the value of homes, flipping them to each other at ballooned prices, and pocketing the difference.

• 44:17Speaker 05

  The scheme worked for a while, but then they started to default on these loans. And, you know, someone's left holding the bag.

• 44:26Speaker 00

  The house of cards collapsed, and Libby was the one left trying to make sense of the wreckage.

• 44:34Speaker 00

  After the indictment, it was another four years of hearings and negotiations before Ted was sentenced to prison. Libby tried her best to co-parent with him during this tense waiting period. He was ordered to pay $149 a month in child support, practically nothing. As part of the divorce agreement, Libby and her daughter could stay in a condo owned by Ted's parents, but only for two years. After that, she would be on her own.

• 45:04Speaker 05

  That's not a long time. When you don't have a job, you don't know if you have to go back to school, that goes by very quickly. My daughter was 10 years old, and that scared me a great deal. What scared me more is Ted defaulted on every single thing. So I had to go to court.

• 45:23Speaker 00

  Ted left behind a trail of defaulted debt, some of it in Libby's name through forged signatures.

• 45:31Speaker 05

  And I knew whose signature it was. It was my husband's. I recognized his handwriting.

• 45:36Speaker 00

  She tried to call the debt collectors, but as soon as she said Ted was her ex-husband, their tone shifted.

• 45:43Speaker 05

  If you say it's somebody you don't know, then they're alarmed. You say it's your husband, oh, like we're one person. It really was like I saw my identity over at the altar.

• 45:58Speaker 00

  Her credit was wrecked, and her sense of safety was gone. After those two years were up, she had to find a new home. With nowhere to go, she and her daughter moved into a rundown apartment.

• 46:13Speaker 05

  Pretty dilapidated place, roaches, awful, but I needed a place to live.

• 46:19Speaker 00

  Because of her bankruptcy filing, she couldn't even get the lights turned on in her name.

• 46:25Speaker 05

  They wouldn't even let me get electric in my name without a co-center. And I'm like, well, am I just gonna freeze to death?

• 46:35Speaker 00

  One of the last times she saw Ted, she asked him why he did it.

• 46:40Speaker 05

  And his answer was, because I can. That's what he said to me after all those years. And I said, you bankrupted me. His answer was, I bankrupted myself. It's almost like he didn't care how that affected me.

• 46:55Speaker 00

  One day, when Libby was at a particularly low point, she decided to reach out to Ted's mother.

• 47:01Speaker 05

  I asked his mom. I begged and I said, we need money. I said, do you realize that Ted only pays $149 a month?

• 47:12Speaker 05

  And her exact words were, that's what the courts say.

• 47:15Speaker 00

  This woman had welcomed her into their family and even given her that circle necklace to represent their bond. But Ted's parents wouldn't give her a cent, not even for their granddaughter's education.

• 47:30Speaker 05

  And I couldn't believe it because I adored them. I mean, they had so much. I couldn't understand why they wouldn't be generous.

• 47:40Speaker 05

  They never gave me a dollar more.

• 47:44Speaker 00

  It was heartbreaking because she respected them and she thought she was in their circle. But when she was drowning, they looked the other way. In the end, their loyalty was never to her. It was to Ted.

• 47:59Speaker 05

  I felt like his parents thought I betrayed him by not standing by my man in quotes, if you will. Because that's what I think they wanted me to do. But their son betrayed me.

• 48:12Speaker 00

  Finally, Ted pled guilty. There was no trial, no courtroom showdown, no witness stand where Libby could testify to what she'd lost. In a way, Libby wanted to hear it all out in the open.

• 48:26Speaker 05

  If there's a trial, you get to watch and you can see what happened to your life. I wanted to know what really happened.

• 48:35Speaker 00

  He was sentenced to 18 months in federal prison and ordered to pay $3 million in restitution.

• 48:43Speaker 00

  After the sentencing, Libby decided to go look for answers on her own.

• 48:47Speaker 05

  I decided I wanted to do an archaeological dig on myself.

• 48:51Speaker 00

  She called up an acquaintance who worked in the mortgage business.

• 48:55Speaker 05

  And I asked her, "Do you know what happened?" Because I thought she did. And she said, "You know, Libby, let me tell you something. You need to get on online deed records." She goes, "You might find yourself there." I go, "What do you mean? I've never been on that, ever." She said, "Just take my advice and go look."

• 49:16Speaker 00

  So Libby did, and what she found made her stomach turn.

• 49:21Speaker 05

  Well, I go look at those deeds, and there my name was. They'd forged my name in that fraud scheme. When I found that out, I sent a text message to my ex-husband that I knew what he had done to me. "You used me in your fraud scheme." I mean, what happens if the FBI would have thought that I really was a part of that and I was sitting in prison? He put my freedom in jeopardy, and I never spoke a word to him again.

• 49:51Speaker 00

  Libby took the forged documents to the police station to try and press charges.

• 49:58Speaker 05

  This detective called me and goes, "You know, I was interested in your case. Here's the thing. Your husband's already gone to prison. This case has been adjudicated, so there's nothing that we can do for you." And I thought, "Why not? How come I can't do something for me?" I mean, it looks like I helped facilitate that fraud, but he said there was nothing that could be done.

• 50:24Speaker 00

  If she couldn't get justice, she at least wanted to set the record straight.

• 50:30Speaker 05

  I said, "Well, I want my name off those deeds." I didn't care if they sat there for 10 years. I did not want, for generations, it to look like I committed that fraud.

• 50:42Speaker 00

  After eight years of back and forth, she got the documents amended.

• 50:47Speaker 05

  It finally says on online deed records, "My name was obtained, forged by ex-husband or others." It officially says that. Now there's proof.

• 50:59Speaker 05

  I now can set that rumor straight, but words, rumors, really, truly can harm you forever.

• 51:07Speaker 00

  Even after she got the records fixed, she still hears whispers, rumors about her being in on it.

• 51:15Speaker 05

  And people love it when people that they see as being affluent, living the life, belonging to country clubs, fall. I didn't grow up with all that. I appreciated it, but a lot of people just assume, oh, they deserve it. They need it. I didn't know. I was financially illiterate. And that, I tell people, do not be that. If your significant other is pushing back, that's a red flag.

• 51:46Speaker 00

  It's a lesson she learned the hardest way possible. But unlike the bankruptcy and the deeds, some consequences could never be expunged.

• 51:57Speaker 05

  It affected my relationship with my daughter. A young girl had this beautiful life. And all of a sudden, it's food stamps. And people at school aren't being nice to her because her dad's in prison. She was so upset, I mean, her father's going to prison. She just wanted to see him. And he got mad at her and sent her an email from prison, saying, "Don't be like your mother. You won't do well in life." From prison. And I thought, wow, what a statement to make. You're in a federal prison, telling, you know, your daughter not to be like her mother.

• 52:42Speaker 00

  Ted was released from prison in 2010. He never reached out to Libby.

• 52:48Speaker 05

  And then he got to transition right back into another home and a condo that his parents owned. It was never like that for me. I applied for affordable housing twice, never could get it.

• 53:00Speaker 00

  It's hard for Libby to stomach watching Ted end up with a soft landing.

• 53:06Speaker 00

  She's had to fight tooth and nail to rebuild her life and regain financial stability. Plus, there are still big unanswered questions.

• 53:17Speaker 00

  Did Khalid really threaten to kill her? What was really going on there?

• 53:22Speaker 05

  To this day, I don't really know if that's true or not. Maybe a fear tactic. I don't know. I don't know if Ted was lying to me.

• 53:33Speaker 05

  Only Ted would know that.

• 53:40Speaker 00

  She's had to come to terms with being in the dark and not knowing everything about the crimes that destroyed her life.

• 53:48Speaker 05

  I have to just live with never knowing because maybe somebody will come out of the woodwork to talk to me and tell me they haven't yet, but you never know. You never know what could happen.

• 54:02Speaker 05

  You're supposed to forgive people for yourself. I have a really hard time with that.

• 54:09Speaker 05

  But I don't want to be bitter because that just eats you up.

• 54:15Speaker 00

  We end every episode with the same question. Why did you want to tell your story?

• 54:22Speaker 05

  I always mourn that I didn't get the life that I set out to have. Because I grew up with such dysfunction. My dream was to be married to someone who loved me. I know it's silly with that house and the white picket fence and a nice family. Because I didn't have it.

• 54:43Speaker 05

  In the end, it's also a cautionary tale. There's a lot in there that I would never do again. I had to bank a kill and he put money in it and I was okay with that. He paid all the credit cards. He did all of it. And I was clueless. You know, don't do that. Don't let that happen to you. Some small things that I could have done could have changed the course of my life.

• 55:09Speaker 05

  And I mean, literally, here I am today and my life imploded. And I'm like, why did that happen? Maybe to help other people.

• 55:21Speaker 05

  Maybe that's just as simple as that.

• 55:25Speaker 00

  Next week on Betrayal Weekly.

• 55:28Speaker 02

  She's ruined so many lives, broken so many hearts. It's just left me wondering, did she ever have any love for any of us?

• 55:49Speaker 00

  If you would like to reach out to the Betrayal team or want to tell us your betrayal story, email us at [email protected]. That's [email protected]. We're grateful for your support. One way to show support is by subscribing to our show on Apple Podcasts. And don't forget to rate and review Betrayal. Five-star reviews go a long way. A big thank you to all of our listeners. Betrayal is a production of Glass Podcasts, a division of Glass Entertainment Group in partnership with iHeart Podcasts. The show is executive produced by Nancy Glass and Jennifer Fason, hosted and produced by me, Andrea Gunning, written and produced by Monique LaBord, also produced by Ben Fetterman. Associate producers

• 56:33Speaker 00

  are Kristen Malkury and Caitlin Golden. Our iHeart team is Ally Perry and Jessica Krychek. Audio editing and mixing by Matt Delvecchio. Additional editing support from Tanner Robbins. Betrayal's theme composed by Oliver Baines. Music library provided by MyB Music. And for more podcasts from iHeart, visit the iHeart Radio app, Apple Podcasts, or wherever you get your podcasts.

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• 58:00Speaker 00

  She's been thinking about this sleepover all week, but I think about her food allergies all the time. Fortunately, her doctor prescribed ZOLAR, omalizumab. It's proven to significantly reduce allergic reactions if a food allergy accident happens.

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  This is an iHeart Podcast. Guaranteed Human.