An actor charged with defrauding investors out of at least $650 million in a Ponzi scheme has been sentenced to 20 years in federal prison, Think Advisor reports.
U.S. District Judge Mark C. Scarsi handed down the sentence last week for 35-year-old Zach Joseph Horwitz of Los Angeles, who acted under the name Zach Avery. Horwitz was also ordered to pay over $230 million in restitution to his victims for a scheme that ran from March 2014 to at least December 2019.
Horwitz was arrested in April 2021 and pleaded guilty in October to one count of securities fraud.
According to federal prosecutors, he raised money from more than 250 investors by telling them the funds would be used to purchase licensing rights for movies that would be resold to HBO and Netflix for distribution abroad. The criminal complaint said he used numerous fictitious documents to substantiate his claims. The investors, who included three of Horwitz’s closest friends and family members, were told they would receive returns of 25 to 45 percent.
Operating the scheme through his company, 1inMM Capital, Horwitz allegedly used the victims’ money to pay back previous investors and also fund a lavish lifestyle that included the purchase of a $6 million home, expensive cars and travel by private jet.
Investors began complaining when 1inMM Capital began defaulting on its outstanding promissory notes.
According to the Justice Department, “Horwitz falsely reassured investors that any missed payments on promissory notes were caused by the streaming platforms, and that payment on the notes would resume”, and used fabricated emails and text messages to back up his claim.
In their sentencing memorandum, prosecutors said “Horwitz portrayed himself as a Hollywood success story”, but “was not a successful businessman or Hollywood insider. He just played one in real life.” They called his actions a crime of “staggering magnitude.”
Horwitz appeared in several movies, including ‘The White Crow’, ‘The Devil Below’, and ‘Farming’.
The securities fraud attorneys at Lewitas Hyman have decades of experience dealing with such cases and have a deep understanding of how capital markets and financial service firms are intended to work to protect investors. If you think your financial professional or firm engaged in misconduct that caused you investment losses, contact Lewitas Hyman at (888) 655 6002 or through our online contact form for a no-cost evaluation of your matter.