Federal authorities have taken Ozy Media Carlos Watson into custody on charges of fraud, which he is accused of committing while he was the creator of the troubled start-up Ozy Media. The arrest took place a few days after a former executive of the business, Samir Rao, pleaded guilty to separate charges of fraud.
Ozy Media went out of business in 2021 after it was discovered by an investigation conducted by the New York Times that Mr. Rao had impersonated a YouTube executive in an effort to trick investors. Prosecutors from the federal government assert that Mr. Watson “directed a conspiracy to defraud investors” of millions of dollars.
In addition, investigations have been opened into the business by the Department of Justice in the United States as well as the Securities and Exchange Commission. Ozy Media Carlos Watson
Mr. Watson, a former banker for Goldman Sachs and presenter on MSNBC, established Ozy Media in the state of California in 2013. Podcasts, television programmes, and events with a left-leaning perspective were produced by the business, as were profiles of rising stars and emerging trends.
In the year 2020, its estimated worth was $159 million (£132 million).
However, according to documents filed this week in a federal court, Mr. Watson was aware that Ozy Media was “drowning in debt,” but he continued to lie to investors about the company’s revenue and falsely claimed that celebrities and high-profile businesses had made investments.
In an interview with CNBC in 2021, Sharon Osborne, who is married to rock star Ozzy Osbourne, accused Mr. Watson of making a false assertion that the couple had invested in the company. She described Mr. Watson as “the biggest shyster I have ever seen in my life.”
According to a report that was published by the Wall Street Journal, Mr. Watson was taken into custody on Thursday and is scheduled to be arraigned in a federal court in the borough of Brooklyn, New York, on charges of conspiring to conduct wire fraud and conspiring to commit securities fraud.
The BBC has contacted his attorney to ask for feedback on the matter of Ozy Media Carlos Watson.
The beginning of the end for Ozy Media came when it was reported by the New York Times that Mr. Rao had impersonated a YouTube executive while on a call with Goldman Sachs. During this call, Mr. Rao boasted about YouTube’s successful relationship with Ozy while the bank was contemplating making an investment.
Ozy Media Carlos Watson acknowledged that the incident had occurred, but he blamed it on Mr. Rao’s struggles with his mental health. He also stated that the fact that Goldman Sachs did not make the decision to engage did not result in any negative consequences.
Although Mr. Watson had previously denied to the media that he was there, prosecutors allege in court documents submitted this week that he was present during the call and was “texting Rao instructions of what to say.” The allegation comes after Mr. Watson denied that he was there. Ozy Media Carlos Watson
Prosecutors claim that Mr. Watson and Mr. Rao posed as executives of a media company “on numerous occasions” in order to conceal previously fraudulent statements when they were confronted with questions from investors.
On Tuesday, Mr. Rao entered a guilty plea to a charge of conspiracy to commit securities fraud, a charge of conspiracy to commit wire fraud, and a charge of identity theft. He also acknowledged to the judge that he had made misleading statements to investors and inflated the company’s finances. According to the documents filed in federal court, Suzee Han, who previously served as the chief of staff for the business, has also entered a guilty plea to conspiring to commit wire fraud and securities fraud.
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