Posted on: December 17, 2024 10:12 AM

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Carlos watson founder and former CEO of Ozy media inc sentenced to 116 months in prison for leading multi million dollar fraud scheme

Earlier today, in federal court in Brooklyn, Carlos Watson, the founder and former Chief Executive Officer of Ozy Media, Inc. (Ozy), was sentenced by United States District Judge Eric R. Komitee to 116 months in prison for conspiracy to commit securities fraud, conspiracy to commit wire fraud and aggravated identity theft.  Watson was convicted in July 2024 following an eight-week trial.  Ozy, which was also convicted at trial, was sentenced to one year probation. Additional penalties of forfeiture and restitution will be imposed at a later date.

“Carlos Watson orchestrated a years-long, audacious scheme to defraud investors and lenders to his company, Ozy Media, out of tens of millions of dollars,” stated United States Attorney Peace.  “His incessant and deliberate lies demonstrated not only a brazen disregard for the rule of law, but also a contempt for the values of honesty and fairness that should underlie American entrepreneurship.  On far too many occasions, Watson chose deceit over candor, grasping for the illusion of business success and personal acclaim at any cost. Today’s sentence should serve as a warning to those who would engage in fraud that justice will be swift and certain.”

“Carlos Watson masqueraded his former company’s composition and purported success to entice investors, but ultimately cost them millions when the curated façade collapsed,” stated FBI Assistant Director in Charge Dennehy. “Watson abused his official capacity to ensnare subordinates to serve as lackies and perpetuate these fraudulent actions. May today’s sentencing deter any individual from implementing deceptive business practices to avoid a similar fate.”

According to court filings and as proven at trial, between 2018 and 2021, Watson and his co-conspirators orchestrated a scheme to defraud investors out of tens of millions of dollars through fraudulent misrepresentations and omissions about Ozy’s financial performance, including revenue, cash on hand and profit, ongoing business relationships with celebrities, acquisition prospects from high- profile technology and media corporations, contract negotiations and other corporate metrics.  For example, Watson and his co-conspirators lied to prospective investors about who else might be investing in Ozy, the existence and size of acquisition offers received by Ozy, the existence and timing of financing rounds, and the existence and terms of Ozy’s business contracts — going so far as to direct Ozy employees to create fake contracts with forged signatures to provide in due diligence.  On multiple occasions, when faced with questions from lenders or potential investors, Watson and his co-conspirators assumed the identities of and impersonated actual media company executives to cover up their prior fraudulent misrepresentations.  Watson’s scheme caused actual investor losses in excess of $60 million and intended to deprive potential investors of hundreds of millions more on the basis of his and his co-conspirators’ lies and misrepresentations.

From DOJ