SEC Alleges California Actor Ran $690 Million Ponzi Scheme Reselling Film Rights

The Securities and Exchange Commission filed an emergency enforcement action alleging a Los Angeles actor and his company operated a massive Ponzi scheme that raised nearly $700 million from investors who thought they were receiving 35% returns from funding the purchase and resale of film rights to Netflix and HBO. Zachary Horwitz and his company 1inMM (one in a million) Capital, LLC (“1NMM”) were named in a complaint filed by the Commission in the Central District of California and charged with violating numerous federal securities laws in connection with the scheme. At the Commission’s request, the federal judge overseeing the action temporarily froze Horwitz’s and 1NMM’s assets. Horwitz was also arrested earlier today on a wire fraud charge. He was released on a $1 million secured bond.

Horwitz, 34, is a Los Angeles based actor whose IMDB page shows he appeared in approximately 15 moves in the last 12 years. According to the Commission’s complaint, in or around 2014, Horwitz began soliciting investments in short-term promissory notes issued by 1NMM that promised total returns exceeding 35% purportedly generated by Horwitz’s experience and expertise in acquiring and licensing film rights to HBO and Netflix. Horwitz described Netflix and HBO as 1NMM’s “strategic partners,” while also showing investors documentation of his dealings with the movie behemoths including movie distribution agreements. The following, included in the Commission’s complaint, is a representative example of several promissory notes indicating the investments were tied to a specific film project and movie studio:

Horwitz told prospective investors that he would use his experience in the movie industry and relationships with HBO and Netflix to profit from the acquisition and sale of film rights, claiming that he was able to realize such significant profits because the studios were in desperate need for new content. Horwitz apparently raised the majority of funds from five principal investors who in turn combined funds from over 200 “downstream” investors. In total, Horwitz and 1NMM raised nearly $700 million.

According to the Commission, neither Horwitz nor 1NMM ever had any contractual or other business relationship with HBO or Netflix nor did they ever enter into any distribution or acquisition agreements. Instead, Horwitz and 1NMM allegedly used new investor fund to make payments to existing investors, a classic hallmark of a Ponzi scheme. In addition to misappropriating investor funds to repay new investors, Horwitz also allegedly used millions of dollars of investor funds to support a lavish lifestyle that included the cash purchase of a $5.7 million house (pictured below), to fund extravagant trips to Las Vegas and on chartered jets, and the payment of nearly $700,000 to a celebrity interior decorator.

Horwitz’s home, currently listed for sale on Zillow for $6.495 million.

Sometime in late 2019, Horwitz and 1NMM stopped making regular payments to investors, providing a number of reasons including that HBO and Netflix had stopped paying him. At one point in March 2021, Horwitz allegedly suggested to one investor group that they provide 1NMM funds to support legal efforts to obtain payment from HBO.

A copy of the Commission’s complaint is below: