It's a bizarre new twist in the Natalee Holloway story: Joran van der Sloot's fateful trip to Peru was inadvertently financed by the FBI.
"This could turn out to be a huge problem for the FBI," Good Morning America's George Stephanopoulos said in an interview with Fox's Greta van Susteren.
"Well it's a huge embarrassment. No one in the FBI wanted this young woman in Peru to die, there's no question about it, but this was a blunder," Van Susteren said.
A $25,000 down payment was turned over to van der Sloot as part of an alleged extortion plot. He had demanded $250,000 from the Holloway family in return for the truth about what happened to Natalee.
Incredibly, van der Sloot was not arrested. The FBI says agents were still gathering evidence. Four days later he left Aruba for Peru, where he allegedly murdered 21-year-old Stephany Flores Ramirez.
"Basically the FBI has him on tape, they know it, what happened?" Stephanopoulos asked.
"The crime is on tape, that's every prosecutor's dream to have, and they had it on tape, I don't know why they didn't arrest him, and I'm sure the FBI feels horrible about it," said Van Susteren.
"Joran van der Sloot has offered many different explanations of what happened to Natalee Holloway. The hope is that now that he has been arrested in Peru that he will come clean," People magazine executive editor Betsy Gleick tells INSIDE EDITION. People magazine features van der Sloot's arrest on its latest cover.
Authorities in Peru say if convicted, van der Sloot will serve his sentence in one of the world's most violent and most overcrowded prisons.
In an upcoming special, World's Toughest Prisons, the National Geographic Channel looks at conditions in the prison.
It could be home for Joran van der Sloot for the next 35 years.
The Dutchman has not yet been charged. By law, officials in Peru have until this weekend to file charges.