Zachary Horwitz was jailed in 2022 for carrying out a huge fraud based on fake low-budget films.
He was born in Berkeley, California, and grew up in Tampa, Florida, and Fort Wayne, Indiana.
He studied a bachelor’s degree in psychology at Indiana University.
After briefly running FUL, a health-food restaurant in Chicago, he moved to Los Angeles to seek his fortune under the stage name Zach Avery.
He won a few minor roles in various films, including Fury, Curvature, Farming and The White Crow.
He then moved into film production, setting up linMM (“One in a Million”) Capital in 2013 with a fellow producer (who denies involvement in fraud) supposedly to finance low-budget films.
What was the scam?
The idea was that 1inMM would acquire the rights to various low-budget films.
They would then be sold on in Latin America and other markets to huge names like HBO and Netflix.
To finance this, Avery sold promissory notes to investors.
These offered a return of 15 percent in just six months based on contracts already signed.
In reality, the agreements were forged, and none of the deals took place.
Instead, Avery used the money from sales of promissory notes to pay off earlier investors.
He spent the rest of the money on a large Hollywood house with a pool, gym, and 1,000-bottle wine cellar.
In other words, he ran a Ponzi scheme .
What happened next?
Initially, Avery borrowed relatively small sums, mainly from university friends who had gone into investment banking.
This started with with $37,000 in early 2014.
The prompt repayment of their original investment encouraged them to put more money in.
They then got their friends and relatives to invest too.
In 2019, however, Avery suddenly stopped making payments on the notes,
He claimed HBO and Netflix were late in making payments.
By December 2020, a group of investors who were suing Avery confronted Netflix with documents.
These were revealed to be fraudulent, causing the FBI and Securities and Exchange Commission to become involved.
Avery admitted fraud in October and was jailed for 20 years in February 2022 for his crimes.
Lessons to be learned from the fraud?
Avery is thought to have taken around total of $680m from investors.
But by the time he was raided by the authorities, he had only $3,224 in one business account, $306 in a second, $5 in a third, and the fourth was empty.
Avery, 35, of Los Angeles has been ordered to repay more than $230.3 million.
Investors estimate they may have lost at least $235m, though some of this sum may be reduced if early profits are clawed back.