Federal authorities arrest founder of media startup Ozy

NEW YORK (AP) — The founder of the troubled digital start-up Ozy Media was arrested Thursday on fraud charges as part of a scheme to prop up the financially struggling company, which hemorrhaged millions of dollars before it shut down amid revelations of possibly deceptive business practices.

The arrest of Carlos Watson at a Manhattan hotel came after two of the company's top executives pleaded guilty this month to fraud charges, including Ozy's then-chief operating officer, Samir Rao, who allegedly impersonated a YouTube executive during a pitch to Goldman Sachs, a potential investor.

The guilty pleas were first reported by the Wall Street Journal.

Scrutiny on the company widened after the New York Times reported in October 2021 that an Ozy official had masqueraded as a YouTube executive to raise money.

Shortly after, Ozy said it was shutting down.

The Associated Press