Ozy Media, the Mountain View, Calif.-based digital platform covering news, arts, culture, politics, business and sports for millennials, has hired a law firm to investigate allegations a co-founder reportedly tried to deceive Wall Street investors.
Troubles began this week following a report in The New York Times and elsewhere that claimed Ozy co-founder and chief operating officer Samir Rao impersonated a YouTube executive during a conference call earlier this year with Goldman Sachs, which was reportedly considering a $40 million investment in the company. On the call, Rao claimed Ozy content was “a great success” on YouTube.
Following the call, Goldman Sachs declined to invest, and instead alerted the Federal Bureau of Investigation, according to media reports.
Fallout from the move has been swift. Recent high-profile hire Katherine “Katty” Kay, a former BBC anchor and correspondent, resigned Sept. 29 after just four months on the job. And key investor SV Angel announced it would sell all of its shares in the 8-year-old platform.
Former CNN host Carlos Watson, who started Ozy with Rao, told the Times that Rao had been dealing with “a mental health crisis” during the Goldman Sachs call, and had subsequently taken time off to deal with it.
In a statement, the Ozy board of directors said it “fully support[ed]” how the situation was handled, and said it would “continue to review” the company’s leadership in the coming months.