Ozy Media and its founder, Carlos Watson, were convicted of fraud by a Brooklyn federal jury on Tuesday. The case centered on allegations that Watson and his now-defunct startup deceived investors by fabricating financial details and fictitious deals with high-profile entities like Google and Oprah Winfrey.
Watson, a former cable news anchor and investment banker, along with Ozy Media, were found guilty of securities fraud conspiracy and wire fraud conspiracy. Watson also faced a conviction for identity theft. Both Watson and Ozy had pleaded not guilty.
Federal prosecutors said Watson and his California-based news and entertainment company falsified information about Ozy’s finances and audience size, fabricated contracts and inflated earnings projections to court investors.
Founded in 2013, Ozy imploded in 2021 after news reports questioned its audience numbers and revealed that a top executive had impersonated a YouTube executive during a call with Goldman Sachs bankers in which he claimed the streaming site agreed to pay for exclusive rights to an Ozy show.
Prosecutors said Watson could face about 24 to 29 years in prison under recommended federal sentencing guidelines, including a mandatory two years for identity theft. His sentencing is set for November 18.
“Ozy Media ultimately collapsed under the weight of Watson’s dishonest schemes and with today’s verdict, Watson himself has been held accountable for his brazen crimes," Brooklyn US Attorney Breon Peace said in a statement.
Lawyers for Watson and Ozy did not immediately respond to requests for comment.
Watson's lawyer had told jurors that Watson was betrayed by deputies who acted on their own and kept him in the dark about their wrongdoing.
The verdict follows a six-week trial that featured testimony by two former Watson deputies, who pleaded guilty to fraud.
They told jurors they conspired with Watson to hide Ozy's crippling debt, meager cash reserves and slow growth.
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