Former talk show host Carlos Watson was sentenced Monday to 10 years in prison in a federal financial conspiracy case that accused his once-popular Ozzy Media of being the epitome of a “fake it 'til you make it” startup culture. He was sentenced to nearly a year.
It was so extreme that another Ozzie executive impersonated a YouTube executive and promoted Ozzie to investment bankers while Watson coached him, prosecutors said.
Mr. Watson, 55, and the now-defunct company were convicted last summer on charges including conspiracy to commit wire fraud. He denies the charges.
Watson is free on $3 million bail, but faces a minimum sentence of two years in prison and a possible maximum sentence of 37 years.
Prosecutors say the former cable news commentator and host inflated earnings figures, touted non-existent or unconfirmed deals and offers, and floated other false indications about Ozzy's success. He was accused of playing a leading role in a scheme to defraud Ozzie's investors and lenders.
Prosecutors say that while the co-founder posed as a YouTube executive to praise Ozzy on a call with potential investors, Watson would sometimes listen to the talking points and send text messages. That's what it means.
“The dishonesty in this case is extraordinary,” U.S. District Judge Eric Comity said, later telling Watson that “his internal apparatus for distinguishing between truth and fiction was grossly miscalibrated.” spoke.
Watson blamed others for any false reporting and said he was subject to “selective prosecution” as a black entrepreneur in Silicon Valley, where there are disproportionately few African-American executives.
“I loved what we built together with Ozzy,” he said in court Monday, initially addressing supporters in the stands before the judge recommended he back out. He describes himself as a founder who gave his all to the company, and in the company's later years, he took an average salary of about $51,000 from Augie, triple-mortgaged his home, and bought a 15-year-old car. He said he was driving.
Co-founder Samir Rao and former Ozzy chief of staff Susie Han have pleaded guilty and are awaiting sentencing. Both men testified against Watson.
Founded in 2012, Ozy has styled itself as a news and culture hub for globally minded millennials.
Watson boasted an impressive resume that included degrees from Harvard University and Stanford Law School, a stint on Wall Street, on-air shows on CNN and MSNBC, and entrepreneurial talent. Ozy Media is his second startup, founded 10 years after he sold the test prep company he founded in his 20s.
Based in Mountain View, California, Ozy has produced television shows, newsletters, podcasts, and festivals of music and ideas. Watson has hosted several television shows, including the Emmy Award-winning “Black Women OWN the Conversation,” which airs on the Oprah Winfrey Network.
Ozzy won major advertisers, customers, and grants. But behind the outward signs of success, insiders say, was an overextended company that had struggled to survive since 2017 and was broken up.
Former finance vice president Janine Poutret told jurors the company struggled to make payroll, fell behind on rent and took out large advances to pay its bills. Meanwhile, testimony and documents show Ozzie provided prospective investors with revenue numbers that were much higher than those he reported to his accountants.
on the witness stand Mr. Watson said in July that the company's cash pressure was common among startups and that investors knew they were getting unaudited numbers that were subject to change.
ozzy Disbanded in 2021after a New York Times column exposed the methods of telephone impersonation and raised questions about the true size of the startup's audience.
