Warping individual letters in text?

I have been playing with a friends illustrator cs4 and have a question....I have been using Photoshop for quite some time and making some logos etc.Now my question....in Photoshop you are able to warp individual parts of letters by using the lasso tool and warp to say bend the tail end of the letter w.   is there a way to do this in illustrator, I have been playing with it for a couple of hours (newbie at illustrator) and cant seem to figure out how to do this... I separated the individual letters and selected one and even added more anchor points then tried ward or free transform but it did not seem to recognize the additional anchors and only warped fro each corner. Please help???? I also have tried to search tut's for this and was not successful.