Former TV character Carlos Watson was convicted Tuesday in a federal monetary conspiracy case about Ozy Media, an formidable startup that collapsed after one other government impersonated a YouTube government to hype the corporate’s success.
Watson, 53, had been free on bail however was taken into custody to await sentencing.
Brooklyn-based U.S. Legal professional Breon Peace stated the decision held Watson accountable for “brazen crimes” that had been meant to maintain cash-strapped Ozy afloat however finally sank it.
“The jury found that Watson was a con man who told lie upon lie upon lie to deceive investors into buying stock in his company,” Peace stated in a press release, including that the corporate “collapsed under the weight of Watson’s dishonest schemes.”
Peace’s workplace stated a jury discovered Watson responsible of all the costs in opposition to him: conspiracy to commit securities fraud, conspiracy to commit wire fraud and aggravated id theft. Ozy Media additionally was convicted of the identical conspiracy offenses, the one fees the corporate confronted.
Watson and Ozy had pleaded not responsible and denied the allegations. He testified that Ozy’s money squeezes had been customary startup pace bumps and that supplies given to traders famous that the data wasn’t audited and will change — “like ‘buyer beware,’” he stated.
The protection blamed any misrepresentations on Ozy co-founder and chief working officer Samir Rao, who has pleaded responsible.
Watson and Ozy plan to enchantment, legal professionals Ronald Sullivan, Janine Gilbert and Shannon Frison stated in a press release.
Watson’s kin and supporters left courtroom with out commenting, however sporting black shirts emblazoned with, “Whose son is next?”
Watson may face a long time in jail, although sentencing tips for particular person defendants differ. Now-defunct Ozy faces potential monetary penalties.
Watson, a cable information host who’d labored on Wall Road and bought his personal education-related startup, conceived of Ozy in 2012. The Mountain View, California-based firm produced exhibits and gave “Ozy Genius” awards to varsity college students. It interviewed former President Invoice Clinton, received an Emmy Award and produced an annual music-and-ideas competition that President Joe Biden attended in 2017, when he was a former VP.
However prosecutors stated that beneath Ozy’s hip public profile, the corporate was tottering financially from 2018 on. It routinely ran in need of cash to pay distributors, hire and even workers and took out costly loans in opposition to future receipts to cowl its payments, former finance Vice President Janeen Poutre testified.
The prosecution and its key witnesses stated Ozy, with Watson’s blessing, started floating more and more audacious lies to attempt to snag a lifeline from traders.
“Survival within the bounds of decency, fairness, truth, it morphed into survival at all costs and by any means necessary,” Rao advised jurors, saying that Watson had sanctioned all his falsehoods.
Ozy gave a lot greater income numbers to its potential backers than to its accountants, with the discrepancy widening to $53 million versus $11.2 million for 2020, in keeping with testimony and paperwork proven at trial.
Prosecutors stated that the corporate claimed offers and provides it hadn’t actually secured — for instance, that Watson advised a potential investor that Google was keen to purchase Ozy for a whole lot of thousands and thousands of {dollars}. Ozy’s lawyer stated Watson by no means made that declare.
Google CEO Sundar Pichai testified there was no such supply, although he did ponder hiring Watson and offering $25 million to assist Ozy transfer on if he took the Google job.
To woo potential company suitors and lenders, Rao solid some phrases of contracts with a community for one among Ozy’s TV exhibits. Then, when a financial institution wished to verify with the community, Rao arrange a pretend electronic mail account for an precise community government and despatched a message providing data. The financial institution mortgage didn’t occur.
Rao went on to pose as a YouTube government on a cellphone name with funding bankers, in a weird effort to again up a false declare that Rao had made about YouTube paying for an additional Ozy present. The bankers received suspicious, their potential funding evaporated and the actual YouTube exec quickly discovered of the ruse.
Watson’s legal professionals hammered on Rao’s admissions about his personal conduct to attempt to painting him as a liar attempting to keep away from jail by pleasing prosecutors. Rao is awaiting sentencing.
Watson, who hosted a number of Ozy exhibits and podcasts, advised jurors he targeting the corporate’s content material, workers, imaginative and prescient and partnerships greater than on “making sure that every decimal is in the right place.” He stated he traveled about 4 days every week and left finance and operations largely to Rao and others.
“I couldn’t be as hands-on as I probably wanted to be,” he testified.
Ozy quickly unraveled after The New York Occasions revealed Rao’s fake name in a September 2021 column that additionally questioned the start-up’s claims about its viewers dimension.
