SEC Charges Ozy Media, CEO Carlos R. Watson Jr., and Others with Defrauding Investors of $50 Million

In a joint effort, the Securities and Exchange Commission (SEC) and the U.S. Attorney’s Office for the Eastern District of New York have charged media and entertainment company Ozy Media Inc., its CEO Carlos R. Watson, Jr., former COO Samir Rao, and former Chief of Staff Suzee Han with fraudulently raising approximately $50 million from investors. The SEC alleges that Watson and Rao gave prospective investors false information about the company’s financial condition, business relationships and fundraising efforts in an effort to encourage them to invest in Ozy Media. Additionally, the SEC complaint states that Rao impersonated an executive from YouTube during a meeting with a prospective investor in order to support the company’s claim that it was receiving licensing revenue from YouTube, when in fact it was not. The SEC charges all defendants with violations of the anti-fraud provisions of the federal securities laws and related rules, seeks injunctive relief, civil penalties against all defendants, officer and director bars against Watson and Rao, and disgorgement with prejudgment interest against Ozy Media and Watson. Rao has consented to the entry of a judgment up to a 10 year bar on holding office at any publicly traded company and is subject to civil monetary penalties determined by the court. Han has consented to the entry of a judgement of permanent injunction from violating the charged provisions with civil monetary penalties to be determined by the court as well.