Actor arrested for $690M Ponzi scheme sent investors bottles of scotch (2024)

Actor Zach Avery, who was arrested on Tuesday over a $690million Ponzi scheme, reportedly sent investors bottles of Johnnie Walker Blue Label scotch and lived in a $6.5million home in Los Angeles.

The 34-year-old, whose real name is Zachary J. Horwitz, was taken into custody and charged on Tuesday with wire fraud over the Ponzi scheme related to his company1inMM Capital LLC.

He is accused of raising more than $690million over five years after falsely claiming to investors that he had movie licensingdeals with huge companies, including HBO and Netflix, according to a Securities and Exchange Commission (SEC) complaint.

'We allege that Horwitz promised extremely high returns and made them seem plausible by invoking the names of two well-known entertainment companies and fabricating documents,' said Michele Wein Layne, Director of the SEC’s Los Angeles Regional Office.

'We obtained an asset freeze on an emergency basis to secure for the benefit of investors what remains of the money raised by Horwitz,' she added.

Horwitz and 1inMM had promised investors returns in excess of 35 per cent.

Federal authorities say$227million that was put in by victims is still yet to be repaid.

The SEC says Horwitz used the investments to fund his own lavish lifestyle, including $100,000 spent on trips to Las Vegas and the payment of a $1.8million American Express bill.

It has also been revealed that Horwitz used some of the money to purchase a six-bedroom Beverlywood home in 2018, according to the Los Angeles Times.

The home, which features a pool, gym and wine cellar, is now listed for $6.5million.

The actor, who has starred in The Devil Below, You're Not Alone and Last Moment of Clarity, started his film distribution company back in 2013 to acquire and distribute English language feature films to the Latin American market.

Horwitz had told investors they were buying film rights that would be resold to Netflix and HBO but 1inMM actually had no business relationship with either company, the SEC complaint says.

He had allegedly falsely told the investors that he had successful track record of selling film rights and that they were supplying funds to acquire the rights to specific films.

According to authorities, Horwitz provided promotional materials to investors that claimed 1inMM Capital offered 'safe' investments because 'we receive confirmation from each of our outputs indicating their desire to acquire the rights to any title we purchase PRIOR to us releasing funds for the film'.

Among the promotional materials was a 2015 annual report for 1inMM Capital that detailed strategic partnerships withHBO, Netflix and Sony.

That annual report also included a 'library snapshot' of films his company had also distributed via licensing. According to the Times, along with the reportHorwitz sent investors bottles of Johnnie Walker Blue Label Scotch.

The complaint says Horwitz had showed investors fabricated agreements and emails regarding the purported deals with HBO and Netflix.

Those agreements and emailscontained forged, or fictional signatures, of Netflix or HBO employees.

To establish his legitimacy, 'Horwitz provided investors with fake license agreements, as well as fake distribution agreements with Netflix and HBO, all of which contained forged or fictional signatures,' the US Attorney's Office said.

Among the films that Horwitz lied about owning the rights to include the 1989 Jean-Claude Van Damme action film Kickboxer, as well as The Lords of Salem, a 2012 horror movie.

Horwitz managed to secure a series of 6 month or 12 month promissory notes from investment firms on the basis on distributing the films.

Horwitz and 1inMM had promised investors returns in excess of 35 percent.

According to authorities, Horwitz generally paid out the returns until late 2019. He allegedly did this on early investments by using funds from newer investments.

Investors complained after 1inMM start defaulting on returns in late 2019.

Authorities sayHorwitz blamed Netflix and HBO for themounting defaults by forwarding fake correspondence between him andNetflix and HBO.

According to the affidavit, private investment firms had transferred approximately $227 million to 1inMM Capital since late 2018.

Horwitz, through 1inMM Capital, has allegedly defaulted on all these underlying returns.

The FBI said that Horwitz's company has failed to make more than 160 payments he had mapped out to investors, with the Chicago firm JJMT Capital, LLC owed $160million in its principal loan and another $59million in promised profits.

According to the Times, FBI agent JohnVerrastro said that JJMT gaveHorwitz's company$742,250 to pay for distribution rights to the film Bitter Harvest.

JJMT was then supposed to receive a 35 per cent return within six months of the agreement, totaling $999,845.

When he was time for him to pay up, Horwitz started sending fake emails from HBO executives to try and justify the delays in payments, according to the FBI.

'In reality, neither Horwitz nor 1inMM Capital ever engaged in email correspondence with Netflix or HBO, nor did Horwitz or 1inMM Capital ever have any business relationship with Netflix or HBO at all,' Verrastro wrote.

Other main investors included: Movie Fund, Fortune Film Fund One, Fortune Film Fund Two, SACAdvisory Group, Vausse Films and Pure Health Enterprises.

Horwitz's home was raided by FBI agents as he was arrested.

In an initial court appearance in Los Angeles,Horwitz told the presiding judge that he understood the charges against him.

The judge agreed on a $1million secured bond for Horwitz's release until future court proceedings.

Horwitz is scheduled to be arraigned May 13.He could face up to 20 years in prison if convicted.

Representatives for Netflix and HBO have denied that their companies engaged in any business with Horwitz, according to an affidavit.

As far as his acting career goes, Horwitz has struggled to find success.In 2018, he appeared in the sci-fi thriller Curvature.

At the time, a critic from Variety said the film 'wants to get the heart racing and the mind bending simultaneously, but flatlines in both departments'.

Last year, Horwitz appeared in the Last Moment of Clarity movie.