It’s a tale about a Hollywood grifter that reads like an outlandish movie script. But this real-life story has left Tinseltown asking how an unknown, peripheral player could have scammed millions from so many out-of-town investors hoping to cash in on the boom of streaming platforms such as Netflix and HBO.
Last week, Zachary Horwitz, a B-movie actor with a taste for the high life, pleaded guilty to a single count of felony securities fraud, carrying a maximum penalty of 20 years in prison. But behind the dry legalese of his plea, something more – though not necessarily new – was learned about the hunger for content and profit in the enduring global capital of the movie business.
Horwitz – who worked under the stage name Zach Avery – had claimed to be in business finding and licensing Spanish-language movies and TV series to Netflix and HBO. But according to FBI, he had in fact run a five-year, multimillion-dollar Ponzi scheme that defrauded wealthy private investors of at least $227m.
Like many before him, including notoriously the Wall Street fraudster Bernie Madoff, the scheme relied in part on the perpetrator’s criminality and in part on the greed of his investors. Like Madoff, Horwitz promised improbable returns on investment loans.
But there was something more: the ineffable lure of Hollywood.
It’s an age-old story, of course, with institutions and individuals hoping to cash out from the movie business and finding, as it has always been, that Hollywood is a…