NEW YORK (Diya TV) – A Brooklyn federal jury found Carlos Watson and his co-founded startup, Ozy Media, guilty of fraud on Tuesday. The verdict concluded a lengthy trial where the government argued that Ozy Media misled investors by falsifying financial records, inflating audience numbers, and fabricating business deals.
Carlos Watson, who co-founded Ozy Media with Samir Rao in 2013, saw his company launch an online magazine, newsletter, and an annual conference in New York City. Despite securing high-profile partnerships and millions in investments, Ozy Media’s facade crumbled in 2021 after a New York Times article exposed fraudulent activities.
The pivotal moment came when it was revealed that Rao impersonated a YouTube executive during a call with Goldman Sachs about a potential $40 million investment. Rao pleaded guilty to related charges last year and awaits sentencing.
Prosecutors also accused Watson of lying to a prospective investor, claiming Google offered $600 million to acquire Ozy Media. Google CEO Sundar Pichai testified that the company had only considered a $25 million investment to hire Watson. During the trial, Watson’s lawyers attempted to shift the blame to Rao and other Ozy Media employees.
US Attorney Breon Peace stated, “The jury found that Watson was a con man who told lie upon lie to deceive investors into buying stock in his company. Watson invented phony financial figures and caused others to forge fake contracts and impersonate a media executive.”
Watson faced charges of conspiracy to commit securities fraud, conspiracy to commit wire fraud, and aggravated identity theft, carrying a potential 37-year prison sentence.
The trial revealed how Ozy Media fabricated information about its finances and audience size to attract investors. Founded in 2013, Ozy collapsed in 2021 after reports questioned its credibility and exposed Rao’s impersonation incident.
Despite Watson’s denials, evidence showed his involvement in the fraudulent schemes. Testimonies from former deputies who pleaded guilty to fraud corroborated the prosecution’s case. Watson’s own testimony attempted to paint a complex picture of Ozy’s finances, but he struggled to justify the inconsistent revenue figures presented to investors.
The trial included testimonies from YouTube executive Alex Piper and Google CEO Sundar Pichai, who both refuted Watson’s claims of potential deals with their companies. Prosecutors highlighted how Watson assured investors of Ozy’s success even as the company faced financial struggles, including a cash reserve drop to $19,000 in 2018.