Former TV personality Carlos Watson has been convicted in a federal financial conspiracy case related to Ozy Media, a startup that collapsed after engaging in fraudulent activities. Watson, 53, was taken into custody following the announcement of the verdict on Tuesday. The jury found Watson guilty of conspiracy to commit securities fraud, conspiracy to commit wire fraud, and aggravated identity theft. Ozy Media, the company involved in the conspiracy, was also convicted of the same charges.
United States Attorney Breon Peace stated that the verdict holds Watson accountable for his “brazen crimes” that were intended to keep the financially struggling Ozy afloat but ultimately led to its downfall. Peace described Watson as a con man who deceived investors by fabricating lies about the company’s success. The prosecution argued that Ozy faced financial difficulties since 2018, frequently struggling to pay vendors, rent, and employees. Former finance vice president Janeen Poutre testified that the company resorted to taking out expensive loans against future receipts to cover its bills.
Prosecutors presented evidence showing that Ozy, under Watson’s approval, began fabricating increasingly audacious lies in an attempt to secure investments. The company provided potential investors with inflated revenue numbers, claiming deals and offers that were not real. For instance, Watson allegedly told a prospective investor that Google was interested in acquiring Ozy for hundreds of millions of dollars, a claim that Google CEO Sundar Pichai denied during his testimony.
The trial also revealed that Ozy’s co-founder and chief operating officer, Samir Rao, played a significant role in the fraudulent activities. Rao admitted to forging contract terms and impersonating a YouTube executive in an effort to deceive potential corporate suitors and lenders. These actions ultimately led to the unraveling of Ozy after The New York Times exposed Rao’s deception in a September 2021 column.
During the trial, Watson maintained his innocence, claiming that Ozy’s financial struggles were typical for a startup and that investors were aware that the information provided was not audited and subject to change. His defense team placed blame on Rao for any misrepresentations. Watson and Ozy plan to appeal the verdict.
