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latest news Actor who faked movie contracts will be convicted in a massive Ponzi scheme

Actor who admitted to fabricating movie deals with HBO and Netflix in $650 million Ponzi scheme that prosecutors say is the largest in Hollywood history, risks up to to two decades in prison when sentenced on Monday.

Prosecutors have urged U.S. District Judge Mark C. Scarsi to jail Zachary Horwitz, 35, for 20 years, saying he committed a crime “of staggering proportions” and left victims – including close friends and family members – financially ruined and “personally devastated.”

“His Ponzi scheme was not an aberration of an otherwise law-abiding existence,” Asst. American Atties. Alexander B. Schwab and David H. Chao told the judge in a note. “The lie, which he supported for years, was central to his identity. He was a professional criminal; and, unfortunately for his victims, he did his job very well.

Horwitz, whose screen name in a handful of horror movies was Zach Avery, pleaded guilty to securities fraud in October. He admitted to forging movie distribution deals with HBO and Netflix to entice investors to give him at least $650 million which he used to fund a ‘lavish lifestyle’ of private jet flights, cars luxury and a Beverlywood mansion with a screening room and a wine cellar, according to court records.

For nearly seven years, Horwitz used the money he took from new investors to repay old ones with returns of 25% to 45%. When the scam collapsed, $230 million was missing. Prosecutors have urged the judge to order Horwitz to pay $230 million in restitution to his victims, acknowledging “the odds are close to zero” that he will ever repay more than a small fraction.

“The destruction wrought by the defendant cannot be overstated,” prosecutors wrote.

Horwitz’s attorney, Anthony Pacheco, suggested the government was effectively exaggerating the damage. In court papers, Pacheco called the actor “an honest man who has been hampered by mental health issues” and now feels “deep remorse.” The details of Pacheco’s arguments are not publicly known, as he filed most of his sentencing documents under seal.

Prosecutors called Horwitz’s scam ‘strangely similar to the eponymous Charles Ponzi scheme’, which collapsed in 1920 after the former fruit seller and dishwasher could no longer bear his consistent scam to use the $250,000 he collected daily from new investors in his postal coupons to pay off the old ones.

In their memo to Scarsi, prosecutors described Horwitz’s conduct as cruel and calculated, saying he caused “immeasurable pain” to many of the more than 250 investors in his bogus film deals.

While some were high net worth or institutional investors, others were middle class or elderly people who had lost their retirement savings, prosecutors said. They felt “shame, stress, depression, [temptations of] suicide, loss of dignity and loss of faith in humanity,” their memo reads.

An anonymous victim, identified as a 52-year-old parent of two 6-year-old boys, said he filed for bankruptcy after investing money in Horwitz’s bogus trades.

“I am surviving on food stamps, family loans, unemployment and any work I can find while I struggle with the combination of all my stolen money and the closure of my other business due to Covid,” wrote the person. “I have nothing!”

Another victim, an unnamed cancer survivor who also ran a small business, recalled taking out a loan to invest in the movie deals. Horwitz “spent in one month what it took me 15 years of honest work to hoard and borrow,” the person said. “I started my business with a legacy that my father spent 60 years of hard work building up. Gone in a flash on the defendant’s cars, jets and watches. »

Victim statements cited by prosecutors included pleas for the maximum sentence allowed by law. One called Horwitz “a thief with no sense of morality or humanity.” Another said he was ‘stomach ache’ imagining the actor wasting his life savings on ‘Lakers field side tickets’, alluding to social media posts showing Horwitz enjoying the most expensive seats during basketball games.

The FBI discovered that Horwitz spent $5.7 million on the Beverlywood home, $706,000 on interior decorating, $605,000 on Mercedes Benz and Audi cars, $345,000 on private jet and plane travel. yacht, $174,000 for party consultant services in Los Angeles, and $136,000 in Las Vegas casinos and nightclubs. His American Express credit card payments totaled $6.9 million.

The prosecutors’ memo said it would be “difficult to conceive of a more flagrant white-collar crime,” noting that Horwitz’s first victims were college buddies from Indiana University.

“He started by betraying the trust of his own friends, people who let their guard down because they couldn’t imagine that someone they had known for years would unflinchingly scam them and their families out of their savings,” they wrote.

Beginning in 2014, Horwitz told investors that his company, 1inMM Capital, used their money to buy the foreign distribution rights to cheap movies, such as “Slasher Party” or “Satanic Panic,” then resold them for a profit to HBO, Netflix or other streaming platforms for distribution in Latin America and other markets around the world.

In each transaction, Horwitz issued a note to the investor promising repayment in six months or a year with a generous return. But when he pleaded guilty to securities fraud, Horwitz admitted he never bought any movie rights — and forged hundreds of distribution deals.

Horwitz helped fund some of the movies he appeared in, but it’s unclear if that money came from his investment scam, according to filmmakers who worked with him. None of the films were successful.

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