Scamfluencers - Ozy Media: Pivot to Fraud

Episode Date: September 25, 2023

Carlos Watson is a Stanford Law School graduate with big Silicon Valley connections and even bigger dreams. When he pitches investors on his idea for a Millennial-focused news website called Ozy Media, it seems like a sure bet. It’s the early 2010s, and Internet-focused media start-ups have generated tons of buzz – and more importantly, tons of clicks. But Carlos doesn't actually know what he’s doing. And when Ozy fails to attract the readers he’s promised his investors, he decides to ditch the business of truth-telling and go rogue.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Wondery Plus subscribers can listen to scam flu answers early and add free right now. Join Wondery Plus in the Wondery app or Apple podcasts. Wondery Plus Sarah, we've both been laid off from digital media companies in recent history. Do you have a fantasize about quitting media and starting from scratch in a whole new career? Like, maybe we could become welders. I don't actually fantasize about it because I have no other skills.

So there's really nothing to fantasize about. Like I can't learn how to do anything new or can I do anything else. Right. Well, today's episode is a doozy. It's all about the unbelievable hubris of the 2010s media boom and a guy who decided that he had to be at the center of it.

And no, I'm not talking about my former boss or your former boss or any of our bosses. I can't wait to take me through this episode. You're gonna get so mad. It's a foggy morning in Los Angeles in February 2021. Alex Piper is working from home. He's a 40-something-year-old white guy with dark eyes and salt and pepper hair, and he's also the head of unscripted programming at YouTube.

This morning, his assistant is on the phone, letting him know that someone at Goldman Sachs is on the line. They say they want to clarify some comments that Alex made about Aussie media in a meeting earlier that day. Sarah, do you remember Aussie media? Yes. I don't know how you could be a writer online and not have heard of Aussie media. Yeah.

Well, we'll get into the whole thing in a second. But the Goldman reps as they're calling about Aussie media's daily YouTube talk show. It's called the Carlos Watson Show, and it's named after the host and founder of Aussie. In a meeting earlier that day, Alex had supposedly told Goldman Sachs that the show was a big success, and that YouTube was considering making it its premium talk show. That would mean more money and more promotion. On the phone call, Alex even raved about Carlos Watson himself. Now, the rep is asking him to expand on these comments. But Alex has no idea what they're even talking about. Not only has he never spoken with this

Goldman Sachs team before, he's never even worked with Ozzy or the Carlos Watson show. So Alex tells them, that wasn't me on the phone with you. Alex reports the incident to his boss as a YouTube and Google. And everyone he works with wants to know the same thing. If Alex wasn't on the call saying those things, then who was? And this question will ignite a fire storm

that undermines Aussie media, its charismatic founder, and the entire industry of digital media. charismatic founder and the entire industry of digital media. Ghosts aren't real. At least as a journalist, that's what I've always believed. Sure, odd things happened in my childhood bedroom, but ultimately I shrugged it all off. That is, until a couple of years ago, when I discovered that every subsequent argument of that house is convinced they've experienced something inexplicable, too, including the most recent inhabitant who says she was visited at night by the ghost of a faceless woman.

And it gets even stranger. It just so happens that the alleged ghost haunted my childhood room might just be my wife's great grandmother. It was murdered in the house next door by two gunshots to the face. From Wondry and Pineapple Street Studios comes GoStory for podcasts about family secrets, overwhelming coincidence and the things that come back to haunt us. Follow GoStory on the Wondry app or wherever you get your podcasts. You can binge all episodes ad-free right now by joining Wondry Plus. Alison Matt here from British Scandal. Matt, if we had a bingo card, what would be on there? Oh, um, compelling storytelling, egotistical white men and dubious humour.

If that sounds like your cup of tea, you will love our podcast, British Scandal, the show where every week we bring you stories from this green and not always so pleasant land. We looked at spies, politicians, media magnates, a king, no one is safe. And knowing our country, we won't be out of a job anytime soon. Follow British scandal wherever you listen to your podcasts. From Wondery, I'm Sachi Kool, and I'm Sarah Haggy, and this is Scanflincers. Come and give me your attention, I'll pull that boom, I'm a master term, because you are nothing, I feel like a legend." Ozzy Media is an over-the-top version of the story of so many media startups in the 2010s.

From my former employer, BuzzVee News, to Sarah's former employers, Vice and Gawker, we have both been victims of the digital media boom and bust. Trust us when we tell you a lot of this industry is just scam. But Carlos Watson's startup, this con is unparalleled. I'm calling this one Aussie Media, pivot to fraud. [♪ music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music playing in background, music Hivet to Fraud. Our story starts in June 1995. It's a sunny day in Palo Alto, California. The quad outside Stanford Law School is bustling with smarty pants kids and black graduation robes.

They're hugging their classmates and posing for photos with their families. And Carlos Watson is one of them. He's 26, black, handsome, with closely shaved hair and a broad, warm smile. And he has what the kids might call... ...Riz. He's the kind of guy who would make you feel like you're the only person in the room. Graduating from stand-for-the-law seems like a natural progression for Carlos.

He went to Harvard for undergrad and spent time working for the mayor in his hometown of Miami, and for Florida Senator Bob Graham. Growing up, he attended an elite private school, but he doesn't come from wealth. His family just really cares about education. Carlos's father is a Jamaican immigrant and sociology professor. His mother is a Mississippi-born Fulbright scholar with a PhD. This family collects degrees. There are also a bunch of news junkies.

In an interview with Black Enterprise, Carlos credits his dad with inspiring his love of the news. As a kid, we would go to the Miami Airport and he would tell me run inside, buy him newspapers from around the world. And you know when someone eyes light up, whether you're bringing them good food, that's how his eyes would light up when you would bring him those newspapers. So I grew up loving media.

I mean, I grew up loving media too, but it was more like the Simpsons. You know, like I couldn't imagine being a news lover. That was me. I'm so sorry to say. Of course it was. I know, I know. Well, Carlos never loses his love for the news, but his first big jobs are all in politics. He gets hired as chief of staff and campaign manager for a state legislator from Florida, and he briefly works on Bill Clinton's presidential campaign.

After Stanford, Carlos spends two years as a consultant for McKinsey. He's making pretty good money, but he wants to give back. He wants to help kids like him. Smart, college-bound students who don't have a lot of money, at least compared to their peers. And like everyone else in Silicon Valley around this time, Carlos thinks he can save the world and get rich while doing it.

So, in 1997, he starts a company. It's a nonprofit called College Track, which helps kids and underserved communities apply for college and find scholarships. He loops in a co-founder, Lorraine Powell Jobs. Carlos met her while tutoring high school students in East Palo Alto. And Lorraine just happens to be married to Steve Jobs.

Yes, that's Steve Jobs. So while Carlos is still just in his 20s, he already has friends in high places. And he's also internalized the Silicon Valley mindset. And now, Carlos is ready to take the move fast and break things mentality to the industry he's loved since childhood. By the early 2000s, Carlos has decided that what he really wants to do is host his own TV show. But when Carlos starts to pitch the show idea to networks, he gets rejected everywhere. He has literally no TV experience. But Carlos must have done something right in those pitch meetings because he gets invited

by Fox and Quart TV to go on their shows and talk about business and politics. He does well and he starts making the rounds as a pundit on various cable networks. And then in 2003, Carlos gets his big break, guest hosting a slot on CNBC. He crushes it and he gets invited back. Carlos is making a name for himself. He starts hosting specials on CNN, writes a column on their website and co-anchors their electionite coverage in 2004.

He also hosts an interview series on NBC. Wolf Blitzer tells Stan for lawyer magazine that Carlos is a natural. After a few more years, he lands the job he's been gunning for this whole time, his own show. It's called Live with Carlos Watson and it launches on MSNBC in 2009. Carlos finally has his moment in the sun, except it only lasts three months. We don't exactly know why, but Carlos later says it just wasn't the right fit.

But this role was a huge deal for Carlos. He has this insatiable thirst to be universally liked and respected as an authority figure. From the time he started pitching his show, Carlos, rather ominously, compared himself to Charlie Rose. Being a primetime anchor on MSNBC, made that dream come true, if only briefly. So after the show ends, Carlos is ready to do whatever it takes to get that power again,

and he knows he can't do it alone. It's the early 2010s, and a banker named Samir Rao is on his way to lunch. Samir has dark hair, a soft face, and he is tired. For years, he's been working as an associate for Goldman Sachs in New York City, and he hasn't been sleeping much. But today, he's in California, and he turns to the place where so many dudes in their 20s have turned before him. Chipotle As Samir walks through the Chipotle parking lot, he reportedly runs into a familiar face,

Carlos Watson. Samir and Carlos briefly work together in finance after Carlos left MSNBC, and they actually have a lot in common. They're both Harvard grads and were raised by immigrants. Samir's parents came to the US from India. He grew up in a suburb of Detroit before getting a math degree and landing a job at Goldman. And eventually, as this story goes, Samir and Carlos' conversation

in the Chipotle parking lot lands on this question. How could we reimagine the news for a globally-minded, discerning, and diverse group? Or at least this is the origin story that Samir and Carlos later published on their website. This is truly one of the dumbest things I've ever heard. Like, reimagining the news for a globally-minded, discerning and diverse group.

So you mean everyone? Yeah. Well, Samir is impressed by Carlos. He's got a vision and he's super well-connected. Maybe Samir even sees his future self in Carlos, who's about 15 years older than him. Over the next few months, Carlos and Samir even sees his future self in Carlos, who's about 15 years older than him. Over the next few months, Carlos and Samir cook up a new digital media startup. They call it Aussie Media, after the poem Aussie Mandius by poet Percy Shelley.

Yes, it is the one about the futility of human effort, including the line, look on my works, ye mighty, and despair. I always wondered if Aussie was because of the poem, but I never looked into it because I didn't wanna know. And now that I do know, I mean, the writing was on the walls. They said it the first time,

and we just didn't hear it. Okay. Well, on the Ozzy website, they say that they interpret the poem as a call to think big while remaining humble. Of course, this is on the same website where they self-ethologize with the story about a Chipotle parking lot, so do with that what you will. The website also includes whimsical biographies of the founders. It notes that Samir is a classically trained musician who composes jingles, just for fun,

and that Carlos has played pickup games of basketball in places like Iceland and Zababwe. Together, the two founders start plotting Ozzie's path to the top. They have a vision for an expansive, captivating media company that meets millennials where they are online. There's just one problem, and everybody else has that exact same idea.

There's just one problem, and everybody else has that exact same idea. In 2013, Carlos and Samir go to one of Carlos's old pals for money, Lorraine Powell Jobs. Lorraine is running her own company, the Emerson Collective, which invests in everything from education, to healthcare, and, of course, media. I picture Carlos and Samir sitting in Lorraine's modern offices in downtown Palo Alto as Carlos explains that Ozzy will be the HBO of news. Not only will Ozzy uncover what's new and next, it'll be, quote, what cool people read to be smart and smart people read to be cool. Sarah, what do you think that all actually means?

I don't think those words altogether really have meaning, but I think media companies are always trying to be cool. Without realizing that news isn't cool, it's fundamentally uncool. So to me, this says it all because I've every company I've written for basically has this mandate. For people who work hard and play hard. Well, it's a big, bold, vague pitch. But media is going digital, and venture capitalists want in. This is the era where everyone is taking Buzzfeed quizzes

and watching vice documentaries. Now, Ozzy is pitching itself as a competitor. Plus, Lorraine knows Carlos. Her company leads Ozzy's first round of fundraising, which ends up netting more than $5 million. Lorine even joins the Ozzy board. Carlos manages to get some other Silicon Valley backers involved as well.

It doesn't hurt that Ozzy starts co-hosting an annual Christmas party with the Emerson Collective. These investors give them cash, sure, but more importantly, they give Ozzy an air of credibility, which leads to even more cash. In 2014, Carlos gets $20 million from Berlin-based publishing giant Axel Springer. And that sounds like a lot of money

until you hear what the other guys have. At this point, Vice has over half a billion dollars in funding, but there's just one thing standing in Carlos's way. He's never actually run a media company before. And getting clicks isn't as easy as it might seem. But Carlos will do whatever it takes to drive traffic, even if that means burning bridges, faking numbers,

and wearing his newsroom down to the bone. Eugene S. Robinson is really looking forward to his weekend off. It's 2012 and he's basically been living at Ozzy's sad, beige office, and mountain view, California. Eugene was Ozzy Media's first hire. And as the deputy editor, he's been working 18 hours a day, seven days a week in preparation for the website's launch. Eugene is a tall, black man with a thin mustache and a gray streak in his hair. Like his boss, Carlos, Eugene went to Stanford and is the perfect blend of media meets Silicon Valley. He gets the whole move fast

and break things attitude, but he's also skeptical of Carlos' vision. Later, in an op-ed for The New York Times, Eugene claims that he told Carlos, quote, I think you might be a visionary. That is, seeing things that are not there. That is the worst thing you can say to a guy like Carlos. I love Eugene right now. We love Eugene. You're just pulling up as a hero. But Carlos' ambition for Ozzy makes life hell for the upstart editorial team. Carlos wants to make sure Ozzy is telling stories that other outlets aren't reporting on.

And that sounds reasonable, but in practice, it's nuts. Carlos says that journalists can't cover topics already reported on by major outlets, like the BBC, the New York Times, and the Wall Street Journal. So there's just not a lot left over. But Carlos and Samir expect the full-time staff of about four writers and two editors to produce 40 magazine quality articles per week. If he hired the best journalists alive, that is an impossible metric. Yeah. That's unreal. Yeah. Also, it just shows me fundamentally these two have no idea how journalism works. Like, not being able to cover anything that's been mentioned on the biggest sources of news

in the English-speaking world? Like, that's crazy! As Eugene describes it, the launch prep is so intense that he's had to tell Carlos repeatedly that he's taking this particular weekend off. According to Eugene, Carlos is livid. He screams at him, fists pounding on the table and everything. Carlos is so enraged that he reportedly fires Eugene on the spot.

And when Eugene later writes about this time at Ozzy for all to journal, he says that a representative for Watson disputed the events surrounding Eugene's initial exit from the company. He added that the representative did not answer any questions. After a few weeks, the board chair convinces Carlos to rehire Eugene, and then she convinces Eugene to come back. But even with Eugene back at Ozzy, the writers on staff are drowning in work, and it doesn't slow down after the site launches.

Ozzy staffers later recount regularly working from 7.30 a.m. to 1 a.m. each day, writing articles, producing video series, and making podcasts. As the site flounders, Carlos' expectations remain sky high, to the detriment of everyone around him. In an essay about Ozzy published years later, Eugene describes him as a quote, holy terror.

Sarah, can you read this excerpt from Eugene's piece? Yeah, he goes, text and calls from him came whenever he was in the mood to send them. The work week was a seven-day-a-week death march, screaming, shrieking, threats of firing, and the actual docking of pay for unwritten infractions were normal. We were told that if a friend was getting married or had died, send flowers, passion was a number one qualifier, since the thinking went. People who are passionate about something will work 24 hours a day.

You know, of course, this is a very extreme example of this kind of mentality, but it's not uncommon when you work in digital media, especially if it's like kind of start-up-ish in that sense where it's kind of like, you know, like we believe in this, that we're a family, this is everything. And it's like those lies they kind of feed to you.

And you're not getting any extra money out of it. They're the ones getting money from investors, but they expect you to care about it. Like you also gave birth to this platform. But even after big fundraising rounds, Aussie doesn't hire more people for its newsroom. Instead, they spend money on advertising, and it doesn't seem to pay off.

Because after all this time and all this money, Ozzy has still failed to create an audience for its work. Sarah, as someone working in digital media at the time, did you ever organically come across Ozzy's stories online? I honestly think there was maybe one or two that people were sharing, but I don't ever remember clicking through to Aussie.com. And in fact, I think the joke was everyone was like,

what the hell is Aussie? Yeah. They've barely even started publishing and they've already spent $35 million. But like so many digital media startups at the time, the site isn't anywhere near profitable. So now Carlos needs to figure out how to make money and fast. Josh the Miscay was reported missing in October of 2019.

Before he disappeared, he was spotted by park rangers in Olympic National Park. And it told us family that he had given all of his things away to someone and was in trouble. Before he disappeared, he was spotted by park rangers in Olympic National Park, and had told us family that he had given all of his things away to someone and was in trouble. Then people started turning up with his vehicle and various belongings. I'm Marissa Jones, host of The Vanished, a podcast that covers unsolved missing person's cases that have been overlooked or forgotten by the mainstream media, just like this one. Every week I look into a new case, sharing the details of their mysterious disappearance, from interviews with family, friends, law enforcement, and even suspects, in an effort to reveal

the truth. The Vanished has even aided in getting long overdue arrests through our in-depth interviews. There is a human behind the headline, and my goal with this podcast is to raise awareness and help family members find their vanished loved one, or at least a sense of peace. Follow the vanished on the Wondery app, or wherever you get your podcasts, or you can listen to the vanished ad free right now by joining Wondery Plus. This is 48 hours correspondent, Aaron Moriarty. My podcast, My Life of Crime, is delving into a new season of true crime cases like no other.

For a number of years, they thought they had committed the perfect crime. With decades of experience as a lawyer and reporter involved in murder cases, I'm taking on the most chilling investigations. This season, I'm looking into the labyrinth of crime and secrets within families. You are under arrest for murdering your mother. Do you know that I was kidnapped? Do you know that? Join me in my journey to go beyond the scene of each crime behind Prism Walls and into the killer's inner thoughts.

Enjoy my life of crime with Aaron Moriarty on the Wondery app or wherever you get your podcasts. You can listen to my life of crime with Aaron Moriarty on the Wondry app or wherever you get your podcasts. You can listen to my life of crime with Aaron Moriarty, add free on Wondry Plus. Get started with your free trial at Wondry.com slash plus. For years, the Aussie website trudges along. And while it has occasional successes, it struggles to gain traction. It turns out, when reporters can only write about things no one's ever heard of, there aren't a ton of people interested.

Companies usually charge for ads based on the number of people they think are going to see them. And online, the way to measure viewers is with clicks, like that onion headline says, we don't make any money if you don't click the link. Aussie isn't making any money, but neither is anyone else. The investors and founders behind the digital media boom

made a bet that selling ads based on clicks would be a sustainable business model, but by the mid-2010s, it's become clear that the model just isn't profitable, or at least it's not profitable enough for investors, and the industry is a mess. Carlos might think of himself as a unique visionary, but he tries the same strategies that so many other digital media companies do. First up, branded content.

JP Morgan Chase, Amazon, and Visa give Aussie a bunch of money to run sponsored posts, all on the condition that they get a certain number of page views. And Aussie delivers, but not by making stuff that people actually read. Instead, they use a janky, third-party service to turn JP Morgan articles into glorified pop-up ads. They appear before readers get rerouted to the article they actually clicked on. Sneaking these ads in front of readers is basically juicing the stats. No one is actually reading the branded content that they've been selling. Ozzy might not technically be lying to their advertisers, but they're definitely misleading them.

And they're not the only startup media company doing it. Among others, Bustal Digital Group, funnier die, and PC mag are doing the same pop-up scam. Eventually Buzzfeed News runs a story outing them all. It says that over a five-month period, Ozzy got the vast majority of views on its most-read articles fraudulently. The company gets some negative attention,

but eventually, the internet moves on. Even JP Morgan keeps investing with Aussie. For now, Carlos is acting about a shady as everyone else in his position. But when Aussie loses his most powerful ally, he'll get desperate, and that's where the real scam begins. In addition to branded content, Aussie also tries branching out into events as a way to make money and get attention. In July 2016, the company throws their first-ever Aussie fest. It has a sort of Ted Talks vibe with flashier names, like Issa Rae, Cory Booker, and Malcolm

Gladwell. But it's not the smash hit that Carlos envisioned. Only 2,000 people show up. The venue, Central Park's rumsy playfield, is mostly empty. And still, they throw Aussie Fests again in 2017 and in 2018. Somehow getting massive names like Hillary Clinton, RuPaul, and to lib qually. Sarah, I needed to read how Carlos describes the 2018 event to the New York Daily News. Oh God, he says, The whole mission of the festival is to bring diverse voices to one stage and expose people to unexpected perspectives. In years past, people who purchased a ticket to see Jason Derulo have been totally wowed by Jeb Bush.

That went somewhere I was not expecting. I don't know what the average Jason Darulo fan is like, but something tells me they aren't like, whoa, this Jeb Bush guy. He's kinda like Jason. I'm wowed by him. I see the connection here. My eyes are open because I would have never been

exposed to this man otherwise. Yes. Also, I do remember the randomness of Aussie Fest. Yeah. Big time. Because I remember seeing the posters and being like, what the hell is this? Well, Aussie Fest isn't exactly beloved

in the rest of the media landscape either. Rolling Stone calls it a neoliberal nightmare. And there's another issue for Carlos. In 2017, Sharon Osborne sues Ozzy media for trademark infringement. She thinks Ozzy Fest sounds too much like Oz Fest. The music festival she created with her husband, Ozzy Osborne. They eventually settle, but the lawsuit is embarrassing.

So Carlos works hard to smooth things over, and he even claims on CNBC. Fun fact, our friend Ozzy and Sharon sued us briefly. And then we decided to be friends and now they're investors in Ozzy. There's just one problem with that. Sharon says this is a complete lie. She vehemently denies investing in Ozzy,

and she says that she rejected company shares that Carlos offered as a part of a potential settlement. And then, he gets dealt another major blow. The Emerson Collective knows that Ozzy isn't making money. They try to get Carlos to sell the company or at least make new funding dependent on hitting performance targets. And it doesn't work.

So around 2019, they bow out. Carlos' longtime friend, Lorine, leaves the board as well. And it doesn't work. So around 2019, they bow out. Carlos' longtime friend, Lorraine, leaves the board as well. And it gets personal. Remember the annual Christmas party that Ozzy hosted with Emerson? Well, they cut Ozzy out. And Carlos is replaced by celebrity chef Jose Andres. Well this seems to be a breaking point for Carlos.

He hasn't just lost a friend. He's also lost Ozzy's greatest source of legitimacy. With his biggest backer gone and a business model that's failing, Carlos finds the easiest way to keep Ozzy afloat is more lying. He spends most of 2019 traveling the world to woo investors. And instead of admitting that Ozzy isn't doing well, Carlos straight up lies about how much money the company has made in the last two years, exaggerating by several million dollars. He later tells an investor that a big tech company has offered to buy Aussie for $600

million. Okay, Carlos, like $600 million for a website that barely exists. This man is crazy. Yeah, I mean, it's all bullshit, but it makes Ozzy look like a more enticing investment, including to companies like Buzzfeed. At one point, they're reportedly in talks to acquire Ozzy. And who knows if any of it was real or if it was just deployed a boost Ozzy's value, I, as a former Buzzfeed employee,

have no comment. Either way, the deal doesn't go through, but it does help bolster the image that Carlos is trying to create. And it makes the company more attractive to potential backers. According to the SEC, all the hype helps Aussie defraud investors out of $50 million. He uses that money to expand Ozzy Fest. He moves it to Central Park's Great Lawn, aiming to bring in 100,000 people. They have a bigger line up than ever, including Mark Cuban, Spike Lee, Trevor Noah, A.

Rod, and Stacey Abrams. And here's a mini scam for you. One former employee told Forbes that Ozzy would book big name speakers by telling them other celebrities would also be there. They would later claim those people had dropped out, even though they never agreed to be in the festival in the first place. Carlos tells CNBC's Squawk Box that people describe Ozzy fest as Ted meets Coachella. It turns out he's just quoting himself here, which is one of his go-to media strategies.

He's literally doing the, many people are saying things when, in fact, that many people are just him. He is many people. I mean, you gotta hand it to Carlos. He knows how celebrities work, which is. Wait, this person's doing it? Well, I'm gonna do it too.

Meanwhile, like, have you heard of Ozzy? Go on the website, look it up. It's not legitimate. I mean, I don't want to go to any of those events, so that feels right to me. Ozzy also goes hard on advertising. They run an estimated two million dollars worth of ads across New York City. In one ad, they use a photo of the crowd at Global Citizens Festival, implying it was taken at Ozzy Fest. and Aussie spokesperson later apologizes, calling this a mistake. In total, Aussie is projected to spend at least $6 million

on this event. That's way more than they're likely to make on it. But then, Aussie gets a miracle. There's a crazy heat wave in New York, temperatures in the triple digits. Mayor Bill de Blasio cancels the event, and Ozzy gets to file an insurance claim. They can blame their losses on the mayor,

and the weather, rather than their own incompetence. Carlos is saved by an almost literal act of God, but he can't count on that to happen a second time. He's gonna have to make his own luck. a second time. He's going to have to make his own luck. It's late December 2019, just a few months after the would-be catastrophic Aussie fest. Aussie media has a new CFO, TripTi Thakur, and she gets these seed on an email from Samir to a major bank. This email includes documents related to Ozzie's loan application. So remember how Carlos has been lying about Ozzie's profits to get more investments?

Well, he's made $50 million that way, but it's still not enough. Ozzie is burning through cash, which they seem to be mostly spending to boost Carlos' profile. Ozzie produces documentaries, podcasts, and movies with the Oprah Winfrey network, PBS, BBC, and even lifetime. But most of these are hosted by or centered on Carlos in some way. They don't seem to be helping the business. And that's why Aussie is going to the bank for a loan. When Trip The Reads the Email, she sees a contract with a major cable news network. It's for the second season of an Aussie TV show, complete with an episode order, production budget,

and signatures from big-way executives. The contract looks legit, and it implies that there's guaranteed money coming to Aussie. But, Tripney knows that Aussie is still actively negotiating with the network. This contract is fully made up. Carlos has gone from artificially inflating page views to fudging revenue.

So why not just manufacture a contract out of whole cloth? You know, it's very often in these stories that there's a woman who comes in for a job and she's like, it's all reads something that's readily available and is the only person to be like, wait a second. Yeah, man, it just takes one smart broad to figure these things out.

This is like a pattern in these stories. I know. Trip the resigns effective immediately. Sarah, I want you to read her email to Carlos. She writes, this is fraud. This is forging someone's signature with the intent of getting an advance from a publicly traded bank.

To be crystal clear, what you see as a measured risk, I see as a felony. Did either of you have any idea or did it even occur to you to care that I could go to Jill for forgery and bank fraud? I mean, this is like the most polite way to be like, what the hell is going on here? Like what mess did you get me into?

Yeah. Well, Carlos is used to steamrolling his younger employees, but one of them has finally pushed back. And yet, he ignores her warnings. Carlos has repeated his lies so many times that it's possible he actually believes them. But the illusion of Ozzy in his mind is about to collide with reality, and the rest of the world will look on his works

and despair. Despite trip these stern email, Carlos is desperate to keep Ozzy from ending up in the digital media graveyard. So the company makes another pivot, possibly to what Carlos wanted to be doing all along. In 2020, Ozzy launches the Carlos Watson show. It's an interview series hosted by Carlos that runs exclusively on YouTube. To be clear, the show is not a YouTube original,

meaning it's not produced by YouTube's in-house studio. It's just uploaded to YouTube. Carlos manages to get some powerful guests on the show, like Matthew McConaughey and Eva Duverne. According to The New York Times, the show's Booker tells them it will air on A&E. Many of the show's producers and writers are also told that, but an A&E spokesperson says that the network never agreed to air the show. Ozzy plunges money into marketing the series, and the ads are riddled with misleading quotes. Remember what I said about Carlos doing the many people are saying thing? In a promo video for the Carlos Watson show, Ozzy says that the LA Times describes it as quote,

what true discussions look like? A New York plus ad calls Carlos Anderson Cooper meets Oprah. But both of these quotes are from a piece of branded content that Ozzy paid for. It's just Ozzy quoting Ozzy, and here's another one. Ozzy also claims that deadline called Carlos quote, the best interviewer on TV. But a critic never said that, Samir did in an interview with Deadline.

And an Ozzy Billboard in LA calls the Carlos Watson show quote, Amazon Prime's first talk show. Ozzy uploaded the show to Amazon to get more views like many YouTubers do, but Amazon played no role in producing or promoting or paying for the show. That is so wild because he said, on played no role in producing or promoting or paying for the show. That is so wild because he said,

A&E bought the show. At this point, you have to wonder what Carlos thinks about himself. Does he think, just one more lie and people will flock to me in a natural and organic way? Buddy, you've been trying for this song it hasn't happened. Carlos calls his show The Fastest Growing Talk Show in YouTube History, but the numbers are bullshit. So you know how you get ads before YouTube videos and some of them let you skip through

after 15 seconds or whatever? Ozzy is paying for full episodes of the Carlos Watson show to play automatically as ads. So even if people click out, the video could still get a view. One source told Axios that more than 95% of the Carlos Watson show's viewers were paid for. Like many digital media companies, Ozzy is fresh out of ideas. They're just running the pop-up scam again. Carlos reeks of desperation, and he's about to go from shady to reckless.

Bosch Legacy returns. My name's Harry Bosch. I'm a private investigator. Now streaming in a two-episode premiere event. Maddie's been taken. Oh, God. His daughter. He's in the hands of a madman.

Why did the police have been looking for me? The missing officer. And the clock is running out. Is he alive? I'm not going to tell you that. But nothing can stop a father. And we want to find her just as much as you do. I doubt that very much From doing what the law can't

Got to let us do our job. Don't cut me out of this. You have no idea what I'm feeling right now Harry, we have to do this the right way. You have to. I don't Where's my daughter. Bosch Legacy. Watch the new season, now streaming, exclusively unfreevy. I feel like a... I feel like a... Like a... Like a...

Like a... Like a... It's February 2021, and Aussie media is still desperate for cash. Carlos thinks his previous scams didn't work because they didn't go big enough. So he decides to lie to yet another bank. And that's how we get to YouTube executive Alex Piper's call with Goldman Sachs. Remember that one, Sarah? I mean, how could I forget, but also who made the call?

Who was fake Alex? Well, the fake Alex was actually Samir, and he uses a voice distortion app to pretend to be Alex. Throughout the call, Samir gets texts from Carlos who's hovering behind him, and he reads them back to the Goldman team. For example, quote, I'm a big fan of Carlos, Samir, and the show.

At one point, Samir must have used the word wheat to refer to Aussie because court documents show that mid-conversation, he gets a frantic text from Carlos, and it just says, use the right pronouns. You are not Aussie. This is like something that happens in a cartoon, like the jumping around and the like you're this person, not this person. Yeah, it's like a modern I love Lucy episode. Oh my God. Well, when the call ends, the Goldman analysts are baffled.

They call Alex to follow up. And well, you know how that goes. Word of the incident quickly gets to the Aussie board of directors. It is not a good look for Carlos, but he manages to protect himself by telling the board that Samir had a mental health crisis. Like that's better. The guy who is also in charge is having a mental episode where he's pretending to be a person

who exists in order to get more money from, like how's that better? Yeah, nothing gets better here. But the board does seem to accept the story and the whole thing remains internal, at least for the time being. Needless to say, Goldman Sachs does not end up giving Carlos the $40 million. Aussie plows on full steam ahead. They're cranking out more episodes of the Carlos Watson show. They even have another Ozzy Fest plan for October 2021, but it never takes place.

Because the New York Times comes calling, they're about to publish a major story on Ozzy. And would Carlos care to comment? The story runs on September 26, 2021. It centers on the fake Goldman Sachs call, but also touches on Aussie media scams more broadly. Eugene, Aussie's first hire, is quoted as calling the company a Potemkin Village, implying the entire thing was a facade designed to trick people in power. The article is written by Ben Smith, the New York

Times' media columnist. Carlos comes back swinging on Twitter, labeling the piece a hit job, and calling out what he alleges is a conflict of interest. Ben used to be the editor-in-chief of Buzzfeed News, and was reportedly involved in the Buzzfeed Aussie negotiation back in 2019. But the New York Times article opens up the floodgates. Everyone in media seemed to think that Aussie negotiation back in 2019. But the New York Times article opens up the floodgates. Everyone in media seemed to think that Aussie was a total scam, and now their gossip has been confirmed. Forbes, New York Magazine, The Daily Beast, and many more published their own reporting,

covering every aspect of the Aussie scam. The Fallout is Swift. One of Aussie's newest hires, a former BBC journalist, resigns. A&E cancels a second half of an Ozzie-produced documentary it was actually planning to air. CNBC even calls up Sharon Osborne for comment. Sarah, can you read what she tells them about Carlos? Yeah, she says, this guy is the biggest shyster I've ever seen in my life. Within a week, Carlos announces Ozzy is shutting down. But then, psych, four days later,

Carlos goes on the Today Show with an announcement. You know, we're gonna open for business, so we're making news today. This is our Lazarus moment, if you will. This is our Tylenol moment. What the hell is a Tylenol moment? I also don't really know what that means. This guy has a whole world in his mind.

I never wanna to understand. Yeah, we are not on this journey with him. And despite all this humiliation, Carlos somehow keeps a stripped-down bare bones version of the Aussie website running. And despite all the fraud, Carlos stays a free man. But he's about to hit that final deadline.

But he's about to hit that final deadline. On February 23rd, 2023, the FBI arrests Carlos at a hotel in Midtown Manhattan. He's charged with multiple counts of fraud and with aggravated identity theft. That's for ordering Samir to impersonate Alex Piper during the Golden Call. He faces up to 37 years in prison. In a statement, the US attorney says

that Carlos, quote, ran Ozzy as a criminal organization rather than as a reputable media company. Carlos posts a million dollar bail after pleading not guilty. Sameer meanwhile has pled guilty to fraud and identity theft. Some suspect he might testify against Carlos, whose trial has been set for May 2024.

But Carlos is determined to fight his case. He takes to Instagram to defend himself. Sarah, can you read this caption for me? Yeah, he says, I'm deeply disappointed by the government's actions yesterday. I'm not now and have never been a con man. I am and have been a hardworking entrepreneur who has helped build a special company from scratch. Okay, just because you build a company doesn't mean you're not a con man because the company legally existed. Well, Sarah, it seems like Carlos might finally be cornered. His shows YouTube channel stops publishing new content and Aussie.com finally shuts down in March 2023. Honestly, it's a better run than I

would have expected. Sarah, did this upset you as much as I was hoping and praying it would? Yeah, I mean, there's something so fascinating about the story because Carlos clearly idealized these websites that were started from the quote unquote ground up by quote unquote regular people. And he wanted the same thing. He wanted the Buzzfeed experience, the vice experience of being like, we started off so small and then look what we became. I think he just got really lost in this pursuit of creating a media company and the scam went too far into criminal territory in a way that others didn't. It's so fascinating to think about it that way.

He could have gotten away with this if he had just done two fewer crazy things. If the website had been a little bit more successful. Yes. But a lot of the stuff Carlos was doing, a lot of the stuff that Ozzy was implementing is still very present in digital media. Also, it was really upsetting to see how these people kind of just do whatever they want

and what happens to people like us like just doesn't matter at all. I'm remembering the pivot to video era of layoffs, which was, you know, almost 10 years ago now, where people were laying off writers in favor of video content, which they said was doing better because of Facebook and then it came out that Facebook inflated these numbers of views for video. Like, you know, like, there's just so many things these companies do that doesn't really mean anything time at the end of the day.

They move on so quickly and the people who actually face the consequences are the people creating the content, you know, the writers and the producers and the people who are slaving away for $40,000 of a year hoping that, you know, maybe we'll get a raise next year. That's why I wasn't surprised even that Eugene went back after everything he had seen because he needs money. I think the real question is what is Carlos going to start next, either when he's acquitted or when he pleads out or when he gets out of jail

because I don't feel like he's done with us. Yeah, I would say so too. I mean, it's easy to hear this and think like, there's no way someone can come back from this level of fraud and these lies and everything, but it really does happen every single day. Sarah, I think I speak for both of us when I say, we're really excited

for the day that we get onboarded at Carlos's next venture. If I was desperate enough, I can't say I wouldn't work for Carlos. I'm sorry, Sarah, I wasn't being sarcastic. I'm being sincere. There's a decent chance that you'll not end up working with or for some of the individuals we made fun of today. I think the lesson here is that any website you're reading right now, they're doing something kind of like this maybe. But not us, but not us. Hey, Prime members, you can listen to scam influencers ad-free on Amazon Music. Download the Amazon Music app today,

or you can listen Add Free with Wondery Plus and Apple podcasts. Before you go, tell us about yourself by completing a short survey at Wondery.com slash survey. This is Ozzie Media, Pivot to Fraud. I'm Sachi Cole. And I'm Sarah Haggi. If you have a tip for us on a story that you think we should cover, please email us at scamfulensorsatwondery.com. We use many sources in our research.

A few that were particularly helpful were Goldman Sachs, Ozzy Media, and a $40 million conference called Gone Wrong by Ben Smith for the New York Times. How Aussie Fest was about to become the next Fire Fest by Jemima McAvoy and David Jeans for Forbes and Aussie Onward by Eugene S. Robinson for Alta. Grace Perry wrote this episode, additional writing by us, Sachi Cole and Sarah Haggy. Our senior producer is Jen Swan. Our producer is John Reed.

Our associate producers are Charlotte Miller and Lexi Peary. Our story editor and producer is Sarah Annie. Eric Thurm is our story editor. Sound design is by Sam Ada. Fact checking by Will Tathlin. Additional audio assistance provided by Adrian Topia. Our music supervisor is Scott Velasquez for Freezonsing. Our coordinating producer is Desi Blaylock.

Our managing producer is Matt Gantt and our senior managing producer is Ryan Lourd. Kate Young and Olivia Rechard are our series producers. Our senior story editor is Rachel B. Doyle. Our senior producer is Ginny Bloom. Our executive producers are Janine Cornelow, Stephanie Jenns, Jenny Lauer Beckman, and Marshall Louis for Wundery.