Libby | Betrayal Weekly

Summary

Betrayal Weekly: The Story of Libby Henry

Episode Title: Libby | Betrayal Weekly
Release Date: August 14, 2025
Host: Andrea Gunning

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1. Introduction to Libby and Her Background

Libby Henry's journey is a poignant tale of trust, deception, and resilience. Growing up in the emotionally tumultuous environment of Louisville, Kentucky, Libby faced significant challenges early in life. Her mother's undiagnosed borderline personality disorder created an unstable home, pushing Libby to seek solace outside.

"[...] 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."
— Libby Henry [04:22]

2. Meeting Ted: The Beginning of a Promising Marriage

Libby's pursuit of a "normal home" led her to the University of Kentucky, where she experienced newfound freedom and formed meaningful connections. It was here that she met Ted House, a charismatic and charming individual who seemed to embody everything she desired in a partner.

"He was undeniably good looking, you know, that tall, dark and handsome. He was all those things."
— Libby Henry [06:17]

Their courtship was swift, evolving from casual dates to an exclusive relationship. Ted's genuine nature and the sense of safety he provided made Libby believe she had found her ideal match.

"I was always laughing. He liked that about me. He liked the humor."
— Libby Henry [08:13]

3. Building a Life Together

After college, Libby and Ted married in a grand church ceremony and settled into a comfortable life in Louisville. Ted's burgeoning mortgage business, supported by his family's financial backing, allowed them to enjoy experiences they once only dreamed of.

"It was like that dream. I told you when I was young, I'm getting married and I'm going to have that family. [...] It's all happening for me."
— Libby Henry [12:40]

However, amidst their apparent success, subtle signs of strain began to surface. Ted's increasing irritability and unexplained stress hinted at underlying issues.

4. Growing Tensions and Red Flags

Libby's concerns grew when Ted became secretive about his business dealings. Despite her persistent requests for financial transparency, Ted remained evasive, fostering an atmosphere of mistrust.

"I mean, I'm dyslexic. It affects my numbers. And Ted was like a human calculator."
— Libby Henry [21:28]

Their relationship, once filled with laughter and mutual support, began to deteriorate as Ted's behavior became erratic. The tension culminated in alarming confrontations where Ted threatened Libby's safety.

"He's going to screw me. He may kill you. He may kill our daughter. What?"
— Libby Henry [25:24]

5. The Unraveling: Mortgage Fraud and Betrayal

Libby's worst fears materialized when she discovered that Ted was entangled in a complex mortgage fraud scheme. The revelation came abruptly, leaving Libby grappling with the devastation of her husband's betrayal.

"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 seven, complete liquidation, bankrupt."
— Libby Henry [32:16]

Despite Ted's assurances, the lack of transparency and the suddenness of the bankruptcy filing raised red flags, prompting Libby to seek answers independently. Her investigation revealed the extent of Ted's deceit, including forged documents implicating her in the fraud.

"I go look at those deeds, and there my name was. They'd forged my name in that fraud scheme."
— Libby Henry [50:25]

6. Aftermath: Divorce, Bankruptcy, and Legal Battles

The fallout from Ted's actions forced Libby into a whirlwind of legal and financial turmoil. The divorce process was swift and acrimonious, leading to the liquidation of their assets and the loss of their home. Libby's credit was irreparably damaged, leaving her and her daughter in dire financial straits.

"She couldn't stay in the marriage. She wanted a divorce."
— Libby Henry [34:24]

Ted's legal troubles continued as he was indicted for multiple counts of fraud, ultimately resulting in an 18-month prison sentence and a hefty restitution order. Meanwhile, Libby struggled to rebuild her life from the ground up, facing societal stigma and personal grief.

7. The Impact on Libby's Life and Family

The repercussions of Ted's betrayal extended beyond financial loss. Libby's daughter faced bullying at school due to her father's incarceration, exacerbating the emotional toll on the family. Ted's lack of remorse and overt hostility further alienated Libby, leaving her isolated and burdened with unanswered questions.

"It affected my relationship with my daughter. [...] She was so upset. I mean, her father's going to prison."
— Libby Henry [53:01]

8. Conclusion and Lessons Learned

Libby Henry's story is a stark reminder of the importance of financial transparency and the red flags that can indicate deeper issues within a relationship. Her journey from betrayal to recovery underscores the resilience required to overcome such profound personal and financial devastation.

"Don't let that happen to you. Some small things that I could have done could have changed the course of my life."
— Libby Henry [55:26]

Through sharing her experience, Libby aims to empower others to recognize and act upon the warning signs of deceit, advocating for vigilance and self-advocacy in the face of betrayal.

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Notable Quotes:

• "I didn't know what was wrong with her because there wasn't the Internet and nobody was talking about mental health back then."
  — Libby Henry [04:57]

• "I bankrupted myself."
  — Libby Henry [47:59]

• "I need my freedom."
  — Libby Henry [54:53]

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Closing Thoughts:

Libby Henry's narrative is a testament to the enduring human spirit and the strength required to navigate the aftermath of profound personal betrayal. Her willingness to share her story serves as both a cautionary tale and a source of inspiration for those facing similar challenges.

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Additional Information:

For more stories of betrayal and resilience, visit Beyond Betrayal Substack and explore Seasons 1-4 of Betrayal, along with Betrayal Weekly Season 1.

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Disclaimer: This summary is based on the transcript provided and aims to capture the essence of Libby Henry's story as presented in the podcast episode.

Transcript

[Andrea Gunning]

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[Andrea Gunning]

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[Libby Henry]

Yet, here are 15 reasons why you should 1. It's $15 a month. 2. Seriously, it's $15 a month.

[Andrea Gunning]

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[Libby Henry]

4.

[Andrea Gunning]

I use it.

[Libby Henry]

5.

[Andrea Gunning]

My mom uses it. Are you. Are you playing me off?

[Libby Henry]

That's what's happening, right? Okay, give it a try. @mintmobile.com Switch upfront payment of $45 for three month plan.

[Annabe]

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[Andrea Gunning]

Then full price plan options available, taxes and fees extra.

[Libby Henry]

Cementmobile.com 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.

[Andrea Gunning]

I'm Andrea Gunning and this is Betrayal. A show about the people we trust the most and the deceptions that change everything. 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 husband's 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 the ever present question.

[Libby Henry]

He didn't know.

[Andrea Gunning]

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.

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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 Louisville.

[Andrea Gunning]

Well, I'm not from there. So for this episode, I'm going to be saying Louisville. Early on, Libby knew her family wasn't like others. Her mother didn't get along with most people.

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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.

[Libby Henry]

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. That was it.

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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. But he started talking about the history syllabus. And I think he was nervous because talking about the history syllabus was kind of boring.

[Andrea Gunning]

Libby left the party underwhelmed.

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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.

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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.

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

Ted's family genuinely loved being around each other.

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

It was within a year he asked me to marry him. He was nervous, but it wasn't some big gesture.

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

This woman named Bea Roth made all three of the daughter in law's rings. My mother in law had a sapphire, a diamond, emerald cut. I had a sapphire and diamond marquis. But we all had the sapphire and diamond to match our mother in law. I couldn't believe that I was marrying someone like Ted. Not because he came from money, but, 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 going to have that family. I remember thinking, it's all happening for me.

[Andrea Gunning]

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.

[Libby Henry]

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.

[Andrea Gunning]

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.

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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.

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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, I'm going home.

[Andrea Gunning]

With their new baby. They packed up and started over and.

[Libby Henry]

We both got full time jobs. At that point I worked for wait for a paging company. Pagers were the things 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.

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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.

[Libby Henry]

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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[Andrea Gunning]

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.

[Libby Henry]

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

[Andrea Gunning]

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.

[Libby Henry]

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

[Andrea Gunning]

They'd been in Louisville a few years.

[Libby Henry]

When 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.

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

Life seemed to be getting better and better and better. I never thought that money was an issue in my life at all.

[Andrea Gunning]

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.

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

Khalid was a guy who grew up in a depressed part of Louisville, and Khalid had done well for himself, business wise. So Khalid, they went into business together flipping homes. Khalid was from that area, and I think he knew a lot of people in that area, which made him a nice liaison.

[Andrea Gunning]

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

[Libby Henry]

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. And then things started to change because.

[Andrea Gunning]

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.

[Libby Henry]

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?

[Andrea Gunning]

What in the world?

[Libby Henry]

Why do you wake up like this? Oh, I've just got a lot on my mind. I just thought, okay, well, there's stress.

[Andrea Gunning]

She knew his job could be intense. He was always managing multiple sales and home renovations. Each had their own deadlines and expenses. But as the year went on, Ted's stress only mounted.

[Libby Henry]

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

[Andrea Gunning]

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.

[Libby Henry]

And I thought he was sick. And I said, what's wrong? His reaction was so unusual. He actually did have tears in his eyes. And he said, it's that effing khalid. And I said, what are we talking about? What's wrong with khalid?

[Andrea Gunning]

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

[Libby Henry]

He's so angry, and he's saying, you know, this effing khalid, he screwed me over. He's going to 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 going to screw me, and he may kill you. He may kill our daughter. What? Those aren't words you expect to hear from your husband About a business associate ever. 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 MFer will do.

[Andrea Gunning]

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.

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

So I waited and waited, and he didn't come back. Well, I gathered myself together, and I Thought, I'm going to call his dad, I'm going to call his parents. And I can still remember his mother saying they were outside by the pool and they absorbed all that information, but it wasn't like they were panicked like I was.

[Andrea Gunning]

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

[Libby Henry]

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. 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. If they thought that that was true, they just reassured me.

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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.

[Libby Henry]

And during that time, things really started to go sideways. Ted's moods were so awful every day.

[Andrea Gunning]

Ted was on edge. The days turned into weeks.

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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. That is me.

[Andrea Gunning]

Since the beginning of their marriage, Ted had paid all their bills, paid off the 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.

[Libby Henry]

So I went to him, and I'm like, I want a folder. 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. And I remember thinking, you know, that's not normal. Why is he defensive?

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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.

[Libby Henry]

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 seven, complete liquidation, bankrupt.

[Andrea Gunning]

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.

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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?

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

And it was like a race down to our attorneys.

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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 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 going to 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?

[Andrea Gunning]

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.

[Libby Henry]

Detail 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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[Andrea Gunning]

We've all heard the stories. Missing persons, double lives, suspicious basements. But here's one mystery you don't need in your life. Why can't my kid learn to ride a bike? For a lot of families, it turns into a saga. Meltdowns in the driveway, scraped knees and frustrated parents googling how to teach a kid to ride a bike without losing your mind. That's where Guardian Bikes comes in. Their bikes are lightweight, low to the ground and built to help kids find their balance fast. Most are riding confidently in just one day. No training wheels, no tears, just high fives and I did it moments. It's everything. Learning to ride should be simple, smooth and actually fun. So skip the struggle and start with a bike that's made to make it easy. Go to guardianbikes.com you'll save hundreds when comparing Guardian to its competitors. Plus get a free bike lock and pump a $50 value with your first purchase when you join their newsletter. That's guardianbikes.com this episode is brought to you by Opill, the first over the counter daily birth control pill available in the us. Opill is a daily birth control pill that's FDA approved, full prescription strength and estrogen free. Plus there's no prescription needed. Finally, the days of needing a prescription for birth control are over. This is the moment to take control of your health and reproductive journeys. Because Opill is birth control in your control. Opill is available online and at most major retailers. Use code betrayal for 25% off your first month of [e-mail] hi, I'm Cindy.

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[Andrea Gunning]

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.

[Libby Henry]

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

[Andrea Gunning]

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.

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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.

[Libby Henry]

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? 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.

[Andrea Gunning]

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.

[Libby Henry]

And this is surreal to me. I mean, one minute I 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.

[Andrea Gunning]

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.

[Libby Henry]

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.

[Andrea Gunning]

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.

[Libby Henry]

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 cart 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.

[Andrea Gunning]

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.

[Libby Henry]

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.

[Andrea Gunning]

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.

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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. And what scared me more is Ted defaulted on every single thing. So I had to go to court.

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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 signed my identity over at the altar.

[Andrea Gunning]

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.

[Libby Henry]

Pretty dilapidated place. Roaches, awful. But I needed a place to live.

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

I asked his mom. I begged and I said, we need money. I said, do you realize that ted only pays $149 a month? And her exact words were, that's what the courts say.

[Andrea Gunning]

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.

[Libby Henry]

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. They never gave me a dollar more.

[Andrea Gunning]

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.

[Libby Henry]

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.

[Andrea Gunning]

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.

[Libby Henry]

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.

[Andrea Gunning]

He was sentenced to 18 months in federal prison and ordered to pay $3 million in restitution. After the sentencing, Libby decided to go look for answers on her own.

[Libby Henry]

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

[Andrea Gunning]

She called up an acquaintance who worked in the mortgage business, and I asked.

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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 fraudsky. 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.

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

Could be done if she couldn't get justice. She at least wanted to set the record straight.

[Libby Henry]

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.

[Andrea Gunning]

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

[Libby Henry]

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

[Andrea Gunning]

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

[Libby Henry]

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 knew. 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.

[Andrea Gunning]

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

[Libby Henry]

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 your daughter not to be like her mother.

[Andrea Gunning]

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

[Libby Henry]

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.

[Andrea Gunning]

It's hard for Libby to stomach watching Ted end up with a soft landing. She's had to fight tooth and nail to rebuild her life and regain financial stability. Plus, there are still big unanswered questions. Did Khalid really threaten to kill her? What was really going on there?

[Libby Henry]

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. Only Ted would know that.

[Andrea Gunning]

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

[Libby Henry]

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. You're supposed to forgive people for yourself. I have a really hard time with that. But I don't want to be bitter because that just eats you up.

[Andrea Gunning]

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

[Libby Henry]

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 in the end. It's also a cautionary tale. There's a lot in there that I would never do again. I had a bank account 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. 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. Maybe that's just as simple as that.

[Andrea Gunning]

Next week on Betrayal Weekly.

[Libby Henry]

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?

[Andrea Gunning]

If you would like to reach out to the Betrayal Team or want to tell us your Betrayal story, email [e-mail] that's betrayalpodmail.com for great 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 Faison, hosted and produced by Me, Andrea Gunning, written and produced by Monique Laborde. Also produced by Ben Federman. Associate producers are Kristin Melchiori and Caitlin Golden. Our iHeart team is Ali Perry and Jessica Krynczyk. Audio editing and mixing by Matt d'. Alvecchio Additional editing support from Tanner Robbins. Betrayal's theme composed by Oliver Baines Music Library provided by Mib Music and for more for more podcasts from iHeart, visit the iHeartRadio app, Apple Podcasts or wherever you get your podcasts.

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[Libby Henry]

Homes.com has collaboration tools to help home shoppers search, share and discuss home shopping.

[LifeLock]

With family, friends and their agent directly through the site.

[Andrea Gunning]

Though it was fun to get that.

[LifeLock]

Email from your husband about that three.

[Libby Henry]

Bedroom in the hills, to which you replied via text that you would never live in the hills and you'd like to find a three bedroom closer to the beach. To which he replied, why are you so uncompromising? A fun way to spend an afternoon, but we think it's just a tad bit easier our way. Homes.com We've done your homework.

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[Andrea Gunning]

This is an I Heart podcast.