


Carlos Watson, the founder of the troubled digital start-up Ozy Media, was arrested and charged with fraud by federal investigators, according to court filings this week.
Prosecutors said in a court document dated Wednesday that Mr. Watson had “engaged in a scheme to defraud Ozy’s potential investors, potential acquirers, lenders and potential lenders” by misrepresenting the company’s audience numbers and financial results. The court filing about Mr. Watson’s arrest was dated Thursday.
Mr. Watson did not respond to calls or messages seeking comment.
Ozy Media, which was backed by investors like the Emerson Collective, had a website, videos posted to YouTube and podcasts that were aimed at young audiences with a mix of stories and videos that identified up-and-coming leaders and important social causes.
The company said in October 2021 that it was shutting down, shortly after The New York Times reported that someone at the company had apparently impersonated a YouTube executive during a conference call with Goldman Sachs, which was considering an investment. On the call, the impersonator said that YouTube had a great working relationship with Ozy and that Ozy’s videos were successful on the platform.
Mr. Watson said at the time that the impersonator was Samir Rao, the company’s chief operating officer.
The Justice Department and the Securities and Exchange Commission later opened investigations into Ozy. Federal prosecutors with the Eastern District of New York had also examined Ozy.
This is a developing story. Check back for updates.