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Press Release

Ozy Media and Its Founder Carlos Watson Indicted in a Years-Long Multi-Million Dollar Fraud Scheme

For Immediate Release
U.S. Attorney's Office, Eastern District of New York
Watson and Ozy Senior Executives Allegedly Defrauded Investors of Tens of Millions of Dollars Through Fraudulent Misrepresentations and Impersonated Media Company Executives During Negotiations

Updated Press Release

An indictment was unsealed this morning in federal court in Brooklyn charging OZY Media Inc. (Ozy), a media and entertainment company headquartered in Mountain View, California, and its founder and Chief Executive Officer, Carlos Watson, with conspiracy to commit securities fraud and conspiracy to commit wire fraud in connection with a scheme to defraud Ozy’s investors and lenders by making material misrepresentations about Ozy’s financial and business assets.  Watson is also charged with aggravated identity theft for his role in the impersonation of multiple media company executives in communications with Ozy’s lenders and prospective investors in furtherance of the fraud schemes.  

Watson was arrested this morning and will be arraigned later today before United States Magistrate Judge Cheryl L. Pollak.  If convicted, Watson faces a mandatory minimum sentence of two years’ imprisonment and a maximum sentence of 37 years’ imprisonment.

Watson’s co-conspirators Samir Rao, Ozy’s Chief Operating Officer, and Suzee Han, Ozy’s Chief of Staff from June 2019 to October 2021, previously pleaded guilty to charges relating to their roles in the scheme.  The U.S. Securities and Exchange Commission (SEC) is taking concurrent enforcement action. 

Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the arrest and indictment.

“As the indictment today alleges, Watson repeatedly attempted to entice both investors and lenders through a series of deliberate deceptions and fabrications.  The FBI and our partners in law enforcement will hold any individual willing to defraud investors and financial institutions accountable in the criminal justice system,” stated Assistant Director-in-Charge Driscoll.

The Scheme

As alleged in the indictment and court documents, Ozy is a media and entertainment company whose businesses include digital newsletters, television production, podcasts, and live events, the most prominent of which is a live festival known as “Ozy Fest.”  Watson founded Ozy in 2012 and has served as the company’s Chief Executive Officer since its inception.

Between approximately 2018 and 2021, Watson and his co-conspirators, including Rao and Han, orchestrated a scheme to defraud investors in and lenders to Ozy of tens of millions of dollars through fraudulent misrepresentations and omissions about key aspects of Ozy’s business, including Ozy’s financial results, debts, and audience size.  In addition, 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 “Series C” and “Series D” financing rounds by Ozy, 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. 

Forged Cable Television Contract and Impersonation of Media Executive

In December 2019, Watson and his co-conspirators attempted to induce a bank to lend Ozy money based on misrepresentations and omissions about Ozy’s business.  Watson and his co-conspirators sought to secure the loan with anticipated revenues from a second season of an Ozy television show.  However, the contract between Ozy and the show’s cable network for the second season of the show was still under negotiation.  To induce the bank to make the loan sooner, Watson directed Ozy’s then-Chief Financial Officer (CFO) to send the bank a fake signed contract between Ozy and the cable network purporting to be for the second season.  When the then-CFO refused, Rao, with Watson’s approval, sent the fake contract — which contained terms favorable to Ozy and a forged signature — to the bank, copying the then-CFO.  Later that day, the then-CFO emailed Watson and Rao to say that she was resigning effective immediately.  She explained, “this . . . is illegal.  This is fraud.  This is forging someone’s signature with the intent of getting an advance from a publicly traded bank.”  She continued, “To be crystal clear, what you see as a measured risk — I see as a felony.”

In subsequent months, Watson and his co-conspirators continued to attempt to induce the bank to lend Ozy several million dollars based on misrepresentations and omissions, including regarding the expected revenue from the second season of the Ozy television show.  During these discussions, the bank requested to speak to a representative of the cable network.  To conceal the lies about Ozy’s relationship with the cable network and the status and terms of their agreement, Rao, with Watson’s approval, created a fake email address in the name of an actual executive of the cable network, which Rao used to impersonate the executive and communicate with the bank about the potential loan.

Attempted Fraudulent Investment and Impersonation of Another Media Executive

From approximately November 2020 through February 2021, Watson and his co-conspirators attempted to induce a financial institution to invest up to $45 million in Ozy by means of material misrepresentations and omissions regarding Ozy’s historical and projected financial results, debts, and business relationships.  Had the full $45 million investment occurred as intended, $6 million of the $45 million would have been paid to Watson personally. 

As part of its due diligence process, the financial institution asked Watson and Rao to arrange a meeting with someone from a well-known online video service that Watson and his co-conspirators claimed had paid Ozy nearly $6 million in licensing revenue for “The Carlos Watson Show.”  This was another misrepresentation — Ozy was never paid by this online video service for Ozy content.  Because Ozy did not in fact have any business relationship with the online video service, Watson and Rao agreed that Rao would impersonate a media executive at the online video service in communications with the financial institution.  On or about January 28, 2021, Rao, with Watson’s agreement, created a fake email address in the name of the media executive, which he used to correspond with representatives of the financial institution.

On or about February 2, 2021, Rao had a call with employees of the financial institution during which he impersonated a media executive from the online video service using a voice alteration application that he downloaded onto his cellular telephone to mask his voice during the call.  During the call, Watson was in the same room as Rao, and texted Rao instructions about what to say and what not to say on the call.  Shortly after the call, one of the employees of the financial institution contacted the actual media executive of the online video service, who confirmed that he had not been on the call and that the online video service had no role in the production of The Carlos Watson Show.  When members of the financial institution later spoke with Watson, he falsely claimed that Rao had acted alone and as a result of a mental breakdown.

The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Jonathan Siegel, Dylan A. Stern, and Gillian Kassner are in charge of the prosecution, with assistance from Paralegal Specialist Jake Menz.

The Defendants:

Age:  53
Mountain View, California

Mountain View, California

E.D.N.Y. Docket No. 23-CR-82 (EK)


John Marzulli Danielle Blustein Hass United States Attorney’s Office (718) 254-6323

Updated November 16, 2023

Indictment [PDF, ]
Financial Fraud