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Press Release

Six Indicted In Fraud Cases Related To Telemarketing Operations That Solicited Millions To Fund Fake Movies

For Immediate Release
U.S. Attorney's Office, Central District of California

LOS ANGELES – Four people were arrested today on federal fraud charges stemming from telemarketing operations that allegedly solicited investments in movies with false promises of high returns with little risk.

Today’s arrests are the result of two federal grand jury indictments unsealed this morning. The indictments charge a total of six defendants who allegedly participated in separate fundraising schemes related to bogus film projects. While one movie script was written, no movies were ever actually produced. The indictments allege that the defendants executed the schemes to defraud victims around the nation and collectively caused losses of several million dollars.

The first case is contained in a 29-count indictment relating to two companies -- Mutual Entertainment LLC and Film Shoot LLC. Four defendants related to this scheme are charged with mail fraud, wire fraud, attempted wire fraud and making false statements.

The defendants are:

Samuel Braslau, 53, of Mar Vista, an attorney and co-founder of the companies, who was arrested this morning;

Rand Jay Chortkoff, 64, of Encino, a co-founder of the companies, who was arrested this morning;

Stuart Rawitt, 47, of West Hollywood, a salesperson, who was arrested this morning;

Robert Matias, 50, of Granada Hills, a salesperson who is a fugitive.
The three arrested this morning are expected to be arraigned this afternoon in United States District Court in Los Angeles.

Also today, the Securities and Exchange Commission filed a civil lawsuit that alleges Braslau, Chortkoff and Rawiit defrauded investors (see:

In the second case, the operators of another company – C22 in the San Fernando Valley -- were named in a 19-count indictment that accuses them of mail fraud, wire fraud, and attempted wire fraud. The two named in an indictment focusing on a company known under several permutations of C22 are:

Mack Machen, 70, of Sunland, the president of C22, who has agreed to self-surrender and be arraigned this afternoon; and

Anthony David Millan, 37, of Chula Vista, the CEO of C22, who was arrested this morning and is expected to make his first court appearance this afternoon in United States District Court in Santa Ana.

The first indictment focuses on the activities of a company called Mutual Entertainment LLC and later renamed Film Shoot LLC, which allegedly bilked investors in a motion picture called “Marcel” and later renamed “The Smuggler.”

The indictment alleges that the defendants raised money for the film through boiler room telemarketing operations. The telemarketers allegedly made fraudulent pitches to investors after first representing themselves to be independent “surveyors” from a national research firm. Victims were falsely told that 64 percent of investor money would be used to produce the film, and that investors would be first in line to receive any revenue generated by the movie, according to the indictment, which states that the defendants also falsely claimed to have contracted with well-known actors to appear in “The Smuggler.”

During the course of the Mutual Entertainment/Film Shoot scheme, the defendants allegedly persuaded more than 60 investors across the nation to invest a total of $1.8 million in the movie that was never produced.

In 2011, the Alabama Securities Commission filed an administrative order against the company and one of the defendants, concluding that the defendants in that action had failed to comply with many provisions of the Code of Alabama 1975 pertaining to the offer and sale of investments.  As alleged in the indictment, following the issuance of this order, two other defendants changed the name of the company from Mutual Entertainment to Film Shoot, and the name of the movie from “Marcel” to “The Smuggler,” in an attempt to hide the Alabama Order from potential investors.

The second indictment unsealed today focuses on C22 Capital, Inc. and C22 LLC, Inc. This indictment alleges that telemarketers for C22 fraudulently induced investments to fund a movie titled “Beyond the Mat.”

According to the indictment, the C22 defendants and their telemarketers made cold-calls to potential investors and told the victims that their money would be used to provide short-term “bridge loans.” Later, the defendants began soliciting money for investment in “Beyond the Mat.” The indictment alleges that the defendants issued promissory notes and promised returns of up to 13 percent per year.

Approximately 80 victims were fraudulently induced to invest in C22, and during the course of the scheme they lost more than $3 million, according to the indictment.

In late 2011, the California Department of Corporations issued a Desist and Refrain order the directed C22 LLC, Inc. to stop doing business due to its fraudulent practices. The indictment alleges that the defendants continued to conduct their business under a different name.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.

The wire fraud and mail charges each carry a statutory maximum penalty of 20 years in federal prison.

The criminal investigation is being investigated by the Federal Bureau of Investigation.

Release No. 14-024

Updated June 22, 2015