Actor Arrested in Alleged $690M Ponzi Scheme

The Hollywood Sign
Michael Buckner/PMC

Zachary Horwitz is hardly the first individual to face legal trouble after raising money in Hollywood and allegedly pocketing investment funds. But the amount involved — more than $690 million! — is staggering.

How did he do it?

Horwitz, a 34-year-old actor who has appeared in some minor films under the screen name “Zach Avery," was arrested Tuesday in California and charged with wire fraud. According to the Justice Department, he faces a maximum of 20 years in prison. Separately, the Securities & Exchange Commission reports obtaining an emergency asset freeze after Horwitz and his company, 1inMM Capital, raised hundreds of millions by holding out license rights agreements with Netflix and HBO.

An affidavit by FBI agent John Verrastro details the alleged crime.

According to Verrastro, not only did Horwitz go to investors with fabricated distribution agreements (some purportedly signed by executives at Netflix and HBO), but 1inMM's rights to a library of movies were fraudulent in the first place.

And when Horwitz' company began defaulting on promissory notes and he sought more time, he allegedly began conjuring email correspondence with Netflix and HBO purporting to show the first was doing an audit while the latter was entering a restructuring.

The defendant allegedly used some of the money on a house that included an extensive home theater, gym, wine cellar and grand piano. Some of proceeds also went to repay previous investors in what Verrastro details as consistent with a Ponzi scheme.

Netflix and HBO appear to have played a role in exposing what was happening.

Read the affidavit below.

Horwitz couldn't be contacted for comment.