CEO Carlos Watson and Ozy Media were found guilty of trying to defraud investors on Tuesday after a federal jury deliberated for three days. Watson faces up to 37 years in prison.
“Watson knew the company was failing, but he was determined to turn Ozy and himself into the next big thing, and he wasn’t going to let the truth stand in his way,” Gillian Kassner, a prosecutor, said during the case’s closing arguments in the U.S. District Court in the Eastern District of New York, as reported by the New York Times.
Watson’s Ozy Media collapsed spectacularly in 2021 after the New York Times published an expose that accused the company of inflating its online traffic and video viewership and revealed that COO Samir Rao had impersonated a Google executive on a fundraising call with Goldman Sachs — sparking an FBI investigation.
Rao pleaded guilty last year to fraud charges as did former Ozy chief of staff Suzee Han. They both testified against Watson.
Both Watson, who is a former MSNBC anchor, and his lawyers claimed that any fraudulent activity was the fault of other Ozy employees. Watson testified that he did not intentionally pad the revenue estimates, but presented a typical financial profile for a “scrappy young company.”
Prosecution witnesses, however, said otherwise and cited Watson’s misleading claims of commitments from major players such as Oprah Winfrey and Live Nation Entertainment.
In October 2023, Watson shared a video to social media in which he said he believed that the indictment was racially motivated.
In the video, he said, “Sometimes people of color are warned not to think too big. That the color of your skin will limit what you can hope to accomplish. Like a lot of Black entrepreneurs, I had trouble often getting through the door or getting meetings that they took seriously.”
He mentioned several Black businessmen who were charged with crimes, including Calvin Grigsby and Franklin Raines, arguing, “our mistakes are being turned into crimes and we’re having people charge us in a gross and inappropriate way.” His tweets are now protected and unable to be viewed.
In April, a judge rejected Watson’s motion to dismiss the charges after he claimed he was the subject of discriminatory prosecution.