Ecuadorian construction worker Diego Pillco admitted strangling the Waitress filmmaker in November 2006 after she caught him trying to rob her apartment.
During his testimony in a New York courthouse on Thursday, Pillco confessed to hanging the 40-year-old to make her death look like a suicide.
Pillco, an illegal immigrant in the U.S., was renovating an apartment in the same West Village building in which Shelly had an office.
He said he panicked when Shelly discovered him stealing from her purse and threatened to call the police.
Pillco, 20, will be sentenced on March 6.
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