In a $900 million Ponzi fraud, an aspiring actor pleads guilty
An aspiring actor has pleaded guilty to conducting a vast Ponzi scam that defrauded investors of at least US$650 million (A$900 million) through fraudulent Hollywood film licensing transactions.
Zachary Joseph Horwitz, 34, of Los Angeles, pleaded guilty to a federal securities fraud charge and faces up to 20 years in prison when he is sentenced in January, according to a statement from the US attorney's office.
Prosecutors claimed that between 2014 and 2019, Horwitz obtained hundreds of millions of dollars in loans for his film company, 1inMM Capital LLC, by falsely claiming the funds would be used to acquire distribution rights to films that would then be licensed for distribution to streaming platforms such as Netflix and HBO.
Rather than that, authorities allege, Horwitz used some of the funds to repay earlier investors in a classic Ponzi scheme and to finance a lifestyle that included the purchase of a $6 million mansion.
Authorities reported that over 200 investors, including three of Horwitz's closest college buddies and their family members, lost over $230 million.
Horwitz had previously acted in a number of films, most often in supporting roles, under the name Zach Avery.