(PatriotWise.com)- Ozy Media is under investigation by the Securities and Exchange Commission and the Department of Justice.
The New York Times reported recently that federal prosecutors based in New York have talked with one company at least that has dealt with Ozy Media, according to two separate people who are knowledgeable about the situation.
In a civil investigation that’s going on at the same time, investigators with the SEC have reached out to two companies at least that at one point considered making an investment with Ozy.
The Times reported that it wasn’t able to determine the exact focus of the two separate investigations. However, just last month, a lawsuit was filed against the company, alleging that they were misleading prospective investors.
Statements that companies make to investors are typically examined during investigations conducted by the SEC.
In October, the CEO of Ozy Media, Carlos Watson, referred to those two investigations in a letter he emailed to investors. The Times reviewed that email, in which Watson said Ozy “heard from” the DOJ and SEC. He also added that Ozy Media enlisted the services of the Zuckerman Spaeder law firm “to help us navigate the investigations.”
The Times reached out to all parties involved in these investigations — lawyers for Ozy Media as well as officials with the SEC and DOJ — but all declined to make a comment.
On October 1, Ozy Media announced that they would be shutting down operations. That happened not long after a report from The Times revealed that a person at Ozy Media impersonated an executive with YouTube while on a conference call with people from Goldman Sachs. At the time, the firm was considering making an investment in Ozy Media.
The Times report said the impersonator said YouTube had a long-lasting, great working relationship with Ozy Media, and that the videos Ozy posted on the video platform were very successful.
At the time, Watson commented that the person impersonating the YouTube executive was the COO of the company, Samir Rao. In the email he sent to Ozy investors last month, Watson reiterated that fact and said Rao wasn’t with the company anymore.
Ozy has attempted to come back after they announced they would be shutting down operations. They’ve sent email newsletters to subscribers, for instance.
In one of those emails, Watson said the company made some big mistakes, but he was hoping that the company would come back in full force in 2022. He also added the company was in a good financial position, with more than $10 million in cash on hand.
When Ozy media launched in 2014 as a new-wave company focused on “the new and the next,” it had big financial support from investors that included Laurene Powell Jobs. The company was founded by Rao and Watson, and ran talk shows, podcasts and a general interest website.
They also put on festivals and produced documentary videos.