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Former TV host Carlos Watson took the witness stand Monday in the criminal trial surrounding the collapse of his Ozy Media, insisting he hadn’t schemed to con the startup's backers.
“Mr. Watson, did you conspire to commit securities fraud?” asked his lawyer, Ronald Sullivan Jr.
“I did not,” Watson said, and repeated it when asked about the other charges against him, aggravated identity theft and conspiracy to commit wire fraud.
Watson, a former news and talk show host on networks including CNN and MSNBC, is the key defense witness in the federal trial. He and the now-defunct Ozy are accused of giving backers and lenders phony financial statistics, forged contracts and other false information that created a glowing image of a company that actually was on the rocks.
It disintegrated in fall 2021, after The New York Times raised questions about Ozy's audience size claims and practices, particularly a phone call in which company co-founder Samir Rao impersonated a YouTube executive to champion Ozy to some investment bankers.
Watson and Ozy Media have pleaded not guilty and sought to cast blame for any misrepresentations on Rao. He pleaded guilty, testified against Watson and is awaiting sentencing.
Watson, in his first hours of testimony, put some distance between himself and the fast-growing Ozy's financial details. He said he was more focused during its early years on its vision and staff than on ensuring “every decimal point” was correctly placed.
And he suggested that revenue numbers logged into the company's main financial software program didn't reflect all the money coming in.
Prosecutors have pointed to differences between such internal records and external presentations to support their allegations that Ozy was lying to outsiders about its financial condition. But Watson appeared to suggest the company's use of the software had simply been a work in progress.
“Like a lot of young companies, it was kind of incomplete. People were doing the best they could,” but some revenue was logged in other spreadsheets, Watson said.
Affable and engaging, Watson, a Harvard University and Stanford Law School graduate, went through his modest Miami upbringing and varied career, which ranged from Wall Street to starting and selling a college counseling company to TV. He described brainstorming about what would become Ozy with his mother as she battled cancer in 2012.
“As a Black kid growing up in the ‘70s and ’80s, you wanted to know that the world would have space for your dreams and your ideas and your hopes ... and I wanted to create the kind of media that would elevate that,” he told jurors, who watched keenly. Three sat forward in their seats as they appeared to take careful notes.
Ozy launched a website and newsletters in 2013. The Mountain View, California-based company eventually added TV shows, podcasts and Ozy Fest, a music-and-ideas festival that was held annually for several years in New York's Central Park.
