WEBVTT FILE

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Downloaded from
YTS.MX

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Official YIFY movies site:
YTS.MX

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[line trilling]

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- Hello?

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- Hi, this is Joslyn Jensen.

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I'm calling about
the documentary film.

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- I'm sorry.

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What--what film?

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[inquisitive music]

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- I'm making a documentary
about Zach Avery.

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And I was hoping
that Zach would talk to me

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so he could tell his side
of the story for the film.

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- All right, no.

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I can just tell you
right off the bat, no.

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Absolutely not.

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- The FBI arrested actor
Zachary Joseph Horwitz,

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accused of convincing
several investment firms

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to give him nearly a quarter
of a billion dollars.

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- Today I'm very excited
to be interviewing Zach Avery.

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Zach, hello.
- Hello.

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How are you?
- Very exciting.

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You've had a real big jump
in your career.

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- I took a kind of not
straight path into acting.

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Could I have done this?
Why didn't I do that?

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Why didn't I see it coming?

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But this is my dream.

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This is what I've wanted
to do forever.

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- I don't want
to be bothering you.

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I want to understand because
I've spoken to another person

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who told me that you would.

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And now you're not going to.

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- The FBI says Zach Horwitz,

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who goes by the screen name,
Zach Avery,

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used the victim's money
to repay earlier investors

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and to fund his lifestyle.

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- Yeah, that's basically it.

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Do a little entrepreneur stuff
on the side as well,

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but mainly--mainly acting.

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- Who is this guy?
Where did he come from?

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And how could he
possibly have done

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something this outlandish?

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- And who the fuck
are you, Ronnie?

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- I could tell
from the beginning

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that it was really
going to be a juicy one,

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that it had everything.

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It was Hollywood.

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It was a Ponzi scheme.

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It was a huge amount of money.

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- More than $700 million

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for completely phony
investment deals.

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- That's a staggering
amount of money

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that was moving around,

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all for the purchase
and resale

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of movie rights
that weren't real.

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- Turn around.

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Get down on your knees.

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- We can just tell the truth.

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We can just tell the cops
what happened.

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- We have this treasure trove
of clips of Zach's acting,

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which we can actually use
to mirror

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what's playing out
in real life.

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There are times watching this
when his lines are like

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he's speaking directly
to the story we're telling.

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It's almost like
he's answering for his crimes.

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- Same shit,
different toilet, officer.

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How the fuck are you?

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- I don't think anyone
really knows who he is.

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Maybe even he doesn't even
really know who he is.

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He might just be playing
multiple characters,

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even to this day.

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- I can't ask a pathological
liar for his life story

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and expect him to tell me
the truth, right?

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Especially in a movie
that's all about scamming,

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as we try to figure out
how he did it.

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- How is somebody able
to concoct a scheme this large

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and make it seem legitimate

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and, you know,
actually carry it on

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for the number of years
that he did,

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all by himself?

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- Our secret, okay?

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- Needs to get
a little curvier.

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- So this is
the real Zach Avery,

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in his real office,

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where he does
a lot of his interviews.

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Yeah, and then
this is our re-creation,

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which is pretty good.

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I want to have reenactments.

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So we're going to hire
an actor to play Zach Avery.

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We're not really looking
for an impression.

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But I just want
to see these guys

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embody Zach in an interview.

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This one.
- All right.

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- It looks like you're
so guilty of financial crime.

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- No, that's okay.

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I might be.

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- Speeding?

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- Camera speeding.
- All right.

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Slate in.

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- Scene one, take one, mark.

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- I'll be auditioning
for Zach Avery.

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- Reading for Zach Avery.
- Zach Avery.

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- Zach Avery.
- Zach Avery.

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- I'm auditioning today
for the role of Zach Avery.

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- All right.

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Have you done any research
on the real Zach Avery at all?

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- Every morning,
I read the paper.

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I saw that.
That was a crazy story.

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- So I think
it's kind of interesting

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that he's able to, like,
be that charming

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and that, like,
convincing of a person.

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- I would never do something
like this, personally.

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But I could see
how the desperation

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would take hold.

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- This industry is--

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it's all about
fake it till you make it.

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And everyone will tell you,
if you're not confident,

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pretend to be.

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You know, put on that--
that façade or that mask

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so that others will, you know,
feed off your comfort.

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- Do you know
when we're gonna find out,

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you know, who gets the role?

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I have a vacation coming up.

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So I'm just wondering.

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- Look at the eyes.

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Hmm.

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Yeah, this is him.

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- Here was an actor
nobody had ever heard of,

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who'd been in some
pretty bad movies.

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And he was accused
of pulling off

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an unbelievably audacious
Ponzi scheme.

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It was like, what?

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- There's this idea
that Hollywood is a place

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of immense wealth
and people are beautiful

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and it's a glamorous
environment.

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And I think that can have
an allure to it

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that people want to be
associated with.

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- And when they can't
do it legitimately,

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some people in Hollywood
end up moving

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toward criminal activity.

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And Ponzi schemes are
one of those things.

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- It's not usually as hard
as it was in this case

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to sort of figure out
where a con man came from.

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There's kind of
a mad scientist quality

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to what he was doing.

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So I just set out right away

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to kind of reconstruct
the whole scam.

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- As I mentioned at the top,
we're fellow Midwesterners.

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- Yes, definitely.
- From the land of the corn.

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- Yeah, exactly.

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Good old Indiana.

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- He grew up
in Fort Wayne, Indiana.

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In terms of who he was
as a kid and what he was like,

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it was really hard
to figure all of that out.

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[upbeat pop music]

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♪

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- So tell me about this place.

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[laughter]

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- Generations
of Fort Wayne youth

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have passed through here.

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Zach definitely would have
come here.

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He moved to town when
he was in his early teens.

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What are the odds that you'll
go to school with somebody

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who ends up making news
for, you know,

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masterminding this
multimillion dollar

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Ponzi scheme?

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- So what was your reaction

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when you heard about
the Ponzi scheme?

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Like, you knew
he was a Hollywood guy?

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- No. I had no idea.

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You know, he never acted
in high school.

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Like, I did plays
all four years of high school.

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And Zach and I never
crossed paths once.

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- So he was more of, like,
a jock type of guy...

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- Absolutely.
- At that time.

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- When I read all the coverage
about what he did,

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like, it just occurred to me,
you know,

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this guy is a supervillain.

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And classmates and I were all
there for his origin story.

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- Yeah. Wow.

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So it seems like
what you're telling me

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is that high school, where--

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it was like
the glory days for Zach.

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- Oh, absolutely.

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All you have to do is, like,
crack open a yearbook

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and just see.

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It's like a greatest hits.

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[indistinct chatter]

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[school bell rings]

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[distant laughter]

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[soft music]

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♪

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[whistle blows]

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- Interestingly,
Zach actually had

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a kind of burgeoning career
in football.

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- Yeah.

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- What was that experience
like for you?

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- So went to Indiana
University, started playing.

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[muffled cheering]

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[whistle blows]

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[crowd cheering]

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- But it was derailed...
- It was.

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- For the better,
you could argue now.

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- Basically, it was--
before even the first season,

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is when I got injured.

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It was a total, like, blow.

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Like, my kneecap was
over on the left side.

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Like, it was rough.

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- Man, I knew I knew you.
It was the Rose Bowl.

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Three years ago,
you beat SC, right?

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- Yeah, I got my knee
folded back

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about 90 degrees
the wrong way.

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- Whoa.
That's why you never went pro?

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- Tore the ACL.

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My knee stayed out.

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[both laugh]

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- That's all.

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- He was a good
high school football player.

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- Mm-hmm.

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- But the embellishing,
like saying,

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"Oh, yeah, I was going to play
football at IU."

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He wasn't good enough
to play in the Big Ten.

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- What?
He never played in college?

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- I don't know.

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But my brother
probably knows, like,

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if he actually ever suited up

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for Indiana University
football.

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- Hey, Robbie.
- Hey, Derek.

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Did Zach ever
actually play football

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at Indiana University?

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- No.

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- And then you said
that was before--

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- Yeah, so that was training
before freshman year,

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like, actual,
like, season happened.

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- Did he ever go
to, like, a tryout

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or anything?

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- No.

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He was never on
the football team.

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I think he tore his ACL
playing intramural football.

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- [laughs]
- Oh, okay.

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- What was, like, the--

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the impetus for you to then
say, "Okay, I'm gonna act"?

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Like, "I want to act"?

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- My mom's
a lifelong educator.

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She's a teacher.

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She fully was,
"You need an education

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and you need to go that route
before doing anything else."

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And so I really didn't have
a choice in my head

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of, like,
"I'm gonna be an actor.

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"I'm gonna follow the arts
and I'm gonna be an artist,

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and that's it,
and that's what I want to do."

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I was going to school
for psychology.

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- You started
at Indiana University.

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- Mm-hmm.

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- How did that kind of train
your mindset for acting?

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00:10:00.151 --> 00:10:02.049
- As the actor,
you need to be empathetic

256
00:10:02.153 --> 00:10:04.120
and, like, being able to tap
into these emotions.

257
00:10:04.224 --> 00:10:06.157
And in psychology,
you kind of want

258
00:10:06.260 --> 00:10:08.608
to study why people are doing
the things they're doing,

259
00:10:08.711 --> 00:10:10.368
which obviously goes
hand-in-hand.

260
00:10:10.471 --> 00:10:14.648
- Psychological expertise
and acting and ruthlessness--

261
00:10:14.752 --> 00:10:17.202
these various ingredients
that just together

262
00:10:17.306 --> 00:10:18.514
make for a good con artist.

263
00:10:18.618 --> 00:10:22.276
And psychology was a really
big part of Zach's talents,

264
00:10:22.380 --> 00:10:24.658
as it were.

265
00:10:24.762 --> 00:10:28.110
- My research is mostly
about personality

266
00:10:28.213 --> 00:10:30.940
and how it influences
primarily antisocial behavior.

267
00:10:31.044 --> 00:10:33.840
So I'm really interested
in sort of what kind of traits

268
00:10:33.943 --> 00:10:36.359
make people do bad things.

269
00:10:36.463 --> 00:10:39.155
- Is there anything, like,
that would be a tell?

270
00:10:39.259 --> 00:10:42.365
- Extreme confidence,
I think, is a pretty big one.

271
00:10:42.469 --> 00:10:43.470
I mean, folks,
I think, who are,

272
00:10:43.573 --> 00:10:44.678
like, kind of Ponzi schemers

273
00:10:44.782 --> 00:10:46.680
are kind of
partially psychopathic

274
00:10:46.784 --> 00:10:48.164
because they have
some of the traits

275
00:10:48.268 --> 00:10:49.338
that are associated
with psychopathy,

276
00:10:49.441 --> 00:10:51.340
also the traits
associated with narcissism

277
00:10:51.443 --> 00:10:52.824
and Machiavellianism.
- Hmm.

278
00:10:52.928 --> 00:10:55.171
- But they have
decent impulse control.

279
00:10:55.275 --> 00:10:56.932
- Thanks for joining
class today.

280
00:10:57.035 --> 00:10:58.658
Can we pull
our chairs together?

281
00:10:58.761 --> 00:10:59.935
I just want to have
a little bit of a talk

282
00:11:00.038 --> 00:11:02.454
before we get
into exercises today.

283
00:11:02.558 --> 00:11:05.492
Really, all we have to do is--

284
00:11:05.595 --> 00:11:07.114
we want to get into character, right?

285
00:11:07.218 --> 00:11:08.702
We always talk about,
"I want to get into character.

286
00:11:08.806 --> 00:11:10.497
How do I get
into this character?"

287
00:11:10.600 --> 00:11:12.154
Well, the villain of the story

288
00:11:12.257 --> 00:11:14.639
doesn't know
that he's the villain.

289
00:11:14.743 --> 00:11:16.296
He's just living his own life,

290
00:11:16.399 --> 00:11:19.195
doing things that he feels
justified in doing.

291
00:11:19.299 --> 00:11:22.198
So our job as the actor
is to ask ourselves,

292
00:11:22.302 --> 00:11:24.684
what would get me

293
00:11:24.787 --> 00:11:26.824
to do the things
that that person did?

294
00:11:26.927 --> 00:11:29.447
What is the justification?

295
00:11:29.550 --> 00:11:30.966
- Does anything
stand out to you?

296
00:11:31.069 --> 00:11:32.519
- Well, a lot of crime
is about,

297
00:11:32.622 --> 00:11:34.348
like, a lack of restraint.

298
00:11:34.452 --> 00:11:35.418
So it's not about, like,

299
00:11:35.522 --> 00:11:36.385
"I really, really
want that badly."

300
00:11:36.488 --> 00:11:37.835
It's, "I kind of want that,

301
00:11:37.938 --> 00:11:39.664
"and there's nothing
keeping me from going after it

302
00:11:39.768 --> 00:11:41.252
in whatever way that I want."

303
00:11:41.355 --> 00:11:43.530
- And that's where it gets
kind of fucked up

304
00:11:43.633 --> 00:11:45.428
because we're like,
wait a second.

305
00:11:45.532 --> 00:11:48.569
We all have the ability
to do those things.

306
00:11:48.673 --> 00:11:51.676
If you're pushed,
if you're prodded,

307
00:11:51.780 --> 00:11:55.438
if you have enough desperation
and need...

308
00:11:55.542 --> 00:11:58.718
- When you start to take
those sorts of barriers away,

309
00:11:58.821 --> 00:12:00.685
the world is your oyster, right?

310
00:12:00.789 --> 00:12:02.583
I mean, you can do
almost anything.

311
00:12:02.687 --> 00:12:04.102
- As an actor, I feel like

312
00:12:04.206 --> 00:12:06.173
part of the mystique
of what we do

313
00:12:06.277 --> 00:12:08.244
is that you don't want people
to know

314
00:12:08.348 --> 00:12:10.453
who Zach is as a person.

315
00:12:10.557 --> 00:12:12.283
I want people to be able
to see me on a screen

316
00:12:12.386 --> 00:12:15.873
and say, "That character is
someone I'm believing."

317
00:12:15.976 --> 00:12:17.460
Caught some chatter
on the inside

318
00:12:17.564 --> 00:12:19.704
that might be a real score
if moved on pronto.

319
00:12:19.808 --> 00:12:21.016
This kook's brother ripped

320
00:12:21.119 --> 00:12:24.122
a couple elbows
from the cartel.

321
00:12:24.226 --> 00:12:25.641
- Sounds good.

322
00:12:25.745 --> 00:12:27.608
- This is really incredible.

323
00:12:27.712 --> 00:12:31.543
Did you know that Zach
has a blog?

324
00:12:31.647 --> 00:12:33.476
Well, listen to this.

325
00:12:33.580 --> 00:12:35.133
"From one
of my favorite movies,

326
00:12:35.237 --> 00:12:37.273
"'The Pursuit of Happyness.'

327
00:12:37.377 --> 00:12:39.034
"After Will Smith's
character's son

328
00:12:39.137 --> 00:12:40.173
"tells him he's going to be

329
00:12:40.276 --> 00:12:41.381
a professional
basketball player..."

330
00:12:41.484 --> 00:12:43.624
- [laughs]
I'm going pro!

331
00:12:43.728 --> 00:12:45.316
- Oh!

332
00:12:45.419 --> 00:12:47.663
- "He says, 'Don't ever let
someone tell you

333
00:12:47.767 --> 00:12:49.458
you can't do something,
not even me.'"

334
00:12:49.561 --> 00:12:52.668
both: You got a dream,
you gotta protect it.

335
00:12:52.772 --> 00:12:54.808
- "'People can't do
something themselves,

336
00:12:54.912 --> 00:12:57.052
they want to tell you
you can't do it.'"

337
00:12:57.155 --> 00:12:59.813
both: If you want something,
go get it.

338
00:12:59.917 --> 00:13:01.263
Period.

339
00:13:02.574 --> 00:13:04.128
- Zach gets out of school.

340
00:13:04.231 --> 00:13:07.787
He leaves Indiana University
and moves to Chicago.

341
00:13:09.305 --> 00:13:10.997
I have to assume
that Chicago is

342
00:13:11.100 --> 00:13:12.584
just kind of
a center of gravity

343
00:13:12.688 --> 00:13:14.241
in that part of the country.

344
00:13:14.345 --> 00:13:16.416
You're leaving college
and going to the big city,

345
00:13:16.519 --> 00:13:18.798
Chicago is gonna be that.

346
00:13:18.901 --> 00:13:22.042
One of the mysteries
about his time in Chicago

347
00:13:22.146 --> 00:13:24.873
was this smoothie bar, Ful.

348
00:13:26.806 --> 00:13:28.808
The question was,
who gets out of college

349
00:13:28.911 --> 00:13:30.568
and just opens a business
in Chicago?

350
00:13:30.671 --> 00:13:31.949
That's not easy to do.

351
00:13:32.052 --> 00:13:34.227
You need some real money.
Where did it come from?

352
00:13:34.330 --> 00:13:36.160
I've actually heard
both versions,

353
00:13:36.263 --> 00:13:38.990
that there's
a rags-to-riches version

354
00:13:39.094 --> 00:13:42.960
but also
a came-from-money version.

355
00:13:43.063 --> 00:13:44.789
Zach is said
to have told people

356
00:13:44.893 --> 00:13:47.619
that Howard Schultz,
the CEO of Starbucks,

357
00:13:47.723 --> 00:13:50.174
had bankrolled him

358
00:13:50.277 --> 00:13:53.487
together with this big
finance firm called Maveron.

359
00:13:53.591 --> 00:13:58.389
He would tell people that they
were behind this smoothie bar.

360
00:13:58.492 --> 00:14:00.736
We do know
that right around that time,

361
00:14:00.840 --> 00:14:04.326
his mother had come into a lot
of money, millions of dollars,

362
00:14:04.429 --> 00:14:06.362
that she inherited
from her second husband

363
00:14:06.466 --> 00:14:08.054
after he died.

364
00:14:08.157 --> 00:14:09.883
- I'm Zach.
This is Anton.

365
00:14:09.987 --> 00:14:11.091
We are Ful.

366
00:14:11.195 --> 00:14:12.368
We're really excited
to be a part

367
00:14:12.472 --> 00:14:13.645
of the Lakeview community

368
00:14:13.749 --> 00:14:15.164
and excited to be in Chicago

369
00:14:15.268 --> 00:14:17.063
and fuel the minds, bodies,
and spirits

370
00:14:17.166 --> 00:14:18.374
of the Chicago area.

371
00:14:19.962 --> 00:14:22.723
- I think it went under
very quickly.

372
00:14:22.827 --> 00:14:24.725
- I think for me, it was
always in the back of my head.

373
00:14:24.829 --> 00:14:26.969
You know, I always knew
that, you know,

374
00:14:27.073 --> 00:14:29.040
LA was kind of like the dream.

375
00:14:29.144 --> 00:14:32.837
- And to fund this goal
of moving to LA--

376
00:14:32.941 --> 00:14:34.011
because, you know,
that's where

377
00:14:34.114 --> 00:14:36.013
everything is for acting--

378
00:14:36.116 --> 00:14:39.637
you did sell QuickBooks
software door-to-door.

379
00:14:39.740 --> 00:14:41.846
Do you think that kind of
made you a stronger person

380
00:14:41.950 --> 00:14:43.296
mentally and emotionally?

381
00:14:43.399 --> 00:14:45.505
Because I'm sure
a lot of people said no

382
00:14:45.608 --> 00:14:46.506
to what you were selling.

383
00:14:46.609 --> 00:14:47.887
- Oh, yeah, for sure.

384
00:14:47.990 --> 00:14:50.268
98% of the people
that I talked to

385
00:14:50.372 --> 00:14:52.650
said no or didn't even listen
to what I was selling,

386
00:14:52.753 --> 00:14:53.858
and said no immediately.

387
00:14:53.962 --> 00:14:55.135
- Not interested. Sorry.
- Ah.

388
00:14:55.239 --> 00:14:57.172
- I'm in the middle
of a card game.

389
00:14:57.275 --> 00:14:58.449
And--
- What are you playing?

390
00:14:58.552 --> 00:15:00.865
- I'm--canasta.

391
00:15:00.969 --> 00:15:02.349
- It was one of
those things that--

392
00:15:02.453 --> 00:15:04.110
I needed money.
I needed a job.

393
00:15:04.213 --> 00:15:06.215
I needed something
to make enough

394
00:15:06.319 --> 00:15:09.115
to be able to do the thing
that I knew I was gonna do.

395
00:15:09.218 --> 00:15:12.497
- At the exact same time
that Zach Horwitz owns

396
00:15:12.601 --> 00:15:15.328
a smoothie shop in Chicago,
he's also busting his ass,

397
00:15:15.431 --> 00:15:18.745
going door-to-door
selling QuickBooks software

398
00:15:18.848 --> 00:15:22.231
to get him and Mallory to LA.

399
00:15:22.335 --> 00:15:25.683
I mean, that doesn't
make any sense.

400
00:15:25.786 --> 00:15:28.237
Especially because we know
a couple years earlier,

401
00:15:28.341 --> 00:15:30.826
his mom inherits millions
after her husband died,

402
00:15:30.930 --> 00:15:32.897
which does actually justify
how a kid

403
00:15:33.001 --> 00:15:34.761
right out of college
could have the capital

404
00:15:34.864 --> 00:15:37.074
to open a smoothie shop.

405
00:15:37.177 --> 00:15:39.800
But if I--if my mom has
a couple million dollars,

406
00:15:39.904 --> 00:15:41.319
I'm not going door-to-door.

407
00:15:41.423 --> 00:15:44.081
[laughs]
It doesn't make any sense.

408
00:15:44.184 --> 00:15:45.565
But I think this is like
the college football.

409
00:15:45.668 --> 00:15:47.774
This is just, you know,
stuff that he's using

410
00:15:47.877 --> 00:15:50.742
to spice up his origin story.

411
00:15:50.846 --> 00:15:52.089
- It's hard at the beginning.

412
00:15:52.192 --> 00:15:54.022
You gotta--you gotta
climb the ladder

413
00:15:54.125 --> 00:15:55.955
and--and see what works.

414
00:15:56.058 --> 00:15:58.888
- So let's leave psychology

415
00:15:58.992 --> 00:16:02.030
and smoothie bars behind
in Chicago.

416
00:16:02.133 --> 00:16:04.032
He and his partner, Mallory,
pack up the car

417
00:16:04.135 --> 00:16:05.550
and move to LA.

418
00:16:05.654 --> 00:16:08.553
[tense music]

419
00:16:08.657 --> 00:16:10.348
♪

420
00:16:10.452 --> 00:16:12.902
- I think the scary part
about Zach is,

421
00:16:13.006 --> 00:16:15.664
he came to LA with the plan,
with the scheme,

422
00:16:15.767 --> 00:16:17.010
with a persona.

423
00:16:17.114 --> 00:16:19.323
And it was calculated.

424
00:16:19.426 --> 00:16:22.843
It wasn't something
he just kind of fell into.

425
00:16:22.947 --> 00:16:25.260
He knew what he was doing
from the start.

426
00:16:27.262 --> 00:16:29.574
When I was 21 years old,
I kind of packed up my job

427
00:16:29.678 --> 00:16:31.991
at a pinnacle of my career
and I went out to LA.

428
00:16:32.094 --> 00:16:34.269
I wanted to chase
the Hollywood dream.

429
00:16:35.442 --> 00:16:37.444
I wanted to meet people,
network with people.

430
00:16:37.548 --> 00:16:39.136
I wanted to do everything
I possibly could.

431
00:16:39.239 --> 00:16:42.380
And I was enamored
by the industry.

432
00:16:44.141 --> 00:16:47.247
I think Hollywood
represents opportunity.

433
00:16:47.351 --> 00:16:51.251
And anything you want to do is
available for you to do there.

434
00:16:52.321 --> 00:16:54.496
I got a call for a role.

435
00:16:54.599 --> 00:16:56.118
It was a small role, but
I said, hey, what the heck?

436
00:16:56.222 --> 00:16:57.706
You never know
who you're gonna meet.

437
00:16:57.809 --> 00:16:59.501
You hear stories like that
all the time in LA.

438
00:16:59.604 --> 00:17:00.812
You just have to go.

439
00:17:00.916 --> 00:17:03.505
You never know what directors
or producers or connections

440
00:17:03.608 --> 00:17:05.403
you're gonna meet.

441
00:17:05.507 --> 00:17:07.129
I was on that drive
for two hours.

442
00:17:07.233 --> 00:17:09.338
Almost turned around 25 times.

443
00:17:09.442 --> 00:17:11.064
Like, "What am I doing?
This is two hours away.

444
00:17:11.168 --> 00:17:12.652
It pays nothing."

445
00:17:12.755 --> 00:17:16.483
But I pushed through
and showed up to set.

446
00:17:16.587 --> 00:17:18.278
It was one of those roles
where everybody kind of

447
00:17:18.382 --> 00:17:19.900
looks the same,
talks the same.

448
00:17:20.004 --> 00:17:21.557
But me and Zach
were just obviously cut

449
00:17:21.661 --> 00:17:22.696
from a different cloth.

450
00:17:22.800 --> 00:17:24.250
We instantly bonded.

451
00:17:24.353 --> 00:17:27.115
We exchanged phone numbers
and made it a plan

452
00:17:27.218 --> 00:17:30.083
to link up right after that.

453
00:17:30.187 --> 00:17:33.293
And that's--that's the day
I met Zach Horwitz.

454
00:17:33.397 --> 00:17:36.020
And that's a movie I wish
I would've never shown up to.

455
00:17:36.124 --> 00:17:38.643
I can tell you that much.

456
00:17:39.368 --> 00:17:42.371
- If you know that you came
from Indiana or wherever

457
00:17:42.475 --> 00:17:44.373
and drove across country
or flew here

458
00:17:44.477 --> 00:17:46.513
to land in this place,
to follow this dream,

459
00:17:46.617 --> 00:17:48.757
you obviously had
something in there that said,

460
00:17:48.860 --> 00:17:49.861
like, "I'm good enough.

461
00:17:49.965 --> 00:17:51.346
I can do this."

462
00:17:51.449 --> 00:17:53.624
And it is, yeah,
about studying,

463
00:17:53.727 --> 00:17:55.281
going to class,
and things like that.

464
00:17:55.384 --> 00:17:58.698
But it's also about making
connections with people.

465
00:17:58.801 --> 00:18:01.494
- After meeting Zach on set,
literally the next day,

466
00:18:01.597 --> 00:18:03.496
he invites me over
to meet his girlfriend

467
00:18:03.599 --> 00:18:05.360
and just kind of hang out
and talk shop

468
00:18:05.463 --> 00:18:06.844
and get to know each other.

469
00:18:06.947 --> 00:18:08.225
I meet Mallory,
who, at the time,

470
00:18:08.328 --> 00:18:09.778
wanted to be
a wedding planner.

471
00:18:09.881 --> 00:18:11.366
She had big aspirations

472
00:18:11.469 --> 00:18:12.953
to be a celebrity stylist
in LA.

473
00:18:13.057 --> 00:18:14.679
And she was going
to school for it.

474
00:18:14.783 --> 00:18:16.440
And they tell me
their story about, you know,

475
00:18:16.543 --> 00:18:19.857
being from a small-town family
and small-town school.

476
00:18:19.960 --> 00:18:23.412
- Zach and Mallory have been
together since they were 19.

477
00:18:23.516 --> 00:18:25.828
And there's really no evidence
to suggest

478
00:18:25.932 --> 00:18:27.002
that she knew about the scam.

479
00:18:27.106 --> 00:18:30.523
But their relationship,
their family,

480
00:18:30.626 --> 00:18:33.077
is a huge part
of what makes him credible.

481
00:18:33.181 --> 00:18:34.665
So this is your camera here.

482
00:18:34.768 --> 00:18:36.149
You can just, you know,
stare down the barrel.

483
00:18:36.253 --> 00:18:38.117
We're gonna do a slate.
How's it going?

484
00:18:38.220 --> 00:18:39.428
- Doing all right.
- Good, good, good.

485
00:18:39.532 --> 00:18:40.636
- How about you?
- Yeah, I'm great.

486
00:18:40.740 --> 00:18:41.706
Thanks for being here.

487
00:18:41.810 --> 00:18:43.536
- It kind of struck me
as really familiar

488
00:18:43.639 --> 00:18:46.194
because I had a friend
whose father, actually,

489
00:18:46.297 --> 00:18:48.403
was a part of a Ponzi scheme.

490
00:18:48.506 --> 00:18:50.922
The aftermath leaves
a lot of hurt.

491
00:18:51.026 --> 00:18:52.959
- I think he's a psychopath.

492
00:18:53.062 --> 00:18:54.478
And I don't like
men like that.

493
00:18:54.581 --> 00:18:56.687
- I guess there's a lot that
we don't know about people,

494
00:18:56.790 --> 00:18:58.482
just from passing by.

495
00:18:58.585 --> 00:19:01.278
- It almost seems like
a parallel universe, like--

496
00:19:01.381 --> 00:19:03.280
like it's someone
that I could have known.

497
00:19:03.383 --> 00:19:04.522
- Do you think
she knew what was up?

498
00:19:04.626 --> 00:19:05.868
- Probably not.

499
00:19:05.972 --> 00:19:07.939
The woman doesn't
normally know.

500
00:19:08.043 --> 00:19:09.803
- I think
that she convinced herself

501
00:19:09.907 --> 00:19:11.253
what he was saying was true.

502
00:19:11.357 --> 00:19:15.223
- I mean, his eyes are--
are stunning.

503
00:19:15.326 --> 00:19:16.362
Very attractive eyes.

504
00:19:16.465 --> 00:19:17.811
Pulls you right in.

505
00:19:19.813 --> 00:19:22.437
He definitely had
charisma and confidence.

506
00:19:22.540 --> 00:19:24.370
And you couple that
with good looks

507
00:19:24.473 --> 00:19:27.096
and if you know what to say,
people will believe you.

508
00:19:27.200 --> 00:19:30.410
♪

509
00:19:30.514 --> 00:19:34.483
So I give Zach
my two months' expertise

510
00:19:34.587 --> 00:19:36.658
on what I figured out
in the industry.

511
00:19:36.761 --> 00:19:39.316
And I told him that if you
want to make it in LA,

512
00:19:39.419 --> 00:19:40.524
you got to do
something yourself.

513
00:19:40.627 --> 00:19:41.766
So he kind of leans into me,

514
00:19:41.870 --> 00:19:44.079
and he goes,
"Well, how much does it take

515
00:19:44.183 --> 00:19:45.356
to make a movie?"

516
00:19:45.460 --> 00:19:48.152
And I'm like, "Well,
like blockbusters, or--"

517
00:19:48.256 --> 00:19:49.671
he's like, "No,
something kind of smaller."

518
00:19:49.774 --> 00:19:51.466
I'm like, "Well, I think
you make one

519
00:19:51.569 --> 00:19:53.019
for a couple million,
you know?"

520
00:19:53.122 --> 00:19:55.021
And he's like, "Really?
Okay, okay."

521
00:19:55.124 --> 00:19:57.679
I look at him, and--

522
00:19:57.782 --> 00:19:58.852
"What do you mean?"

523
00:19:58.956 --> 00:20:01.200
Like, you know, he had
this kind of persona

524
00:20:01.303 --> 00:20:03.132
that, like,
"Well, I can afford that."

525
00:20:03.236 --> 00:20:05.238
So I'm just kind of like, huh.

526
00:20:05.342 --> 00:20:06.929
And he tells me about

527
00:20:07.033 --> 00:20:08.517
a company he founded
called Ful.

528
00:20:08.621 --> 00:20:09.967
He told me
he was so successful,

529
00:20:10.070 --> 00:20:13.971
he opened multiple stores
in a matter of six months.

530
00:20:14.523 --> 00:20:17.216
And he told me
it eventually sold to Maveron.

531
00:20:17.319 --> 00:20:18.769
He was whispering all this.

532
00:20:18.872 --> 00:20:20.357
He was being
a little bit coy about it,

533
00:20:20.460 --> 00:20:22.945
but I was
absolutely intrigued.

534
00:20:23.049 --> 00:20:26.604
And I asked him, "How much
did you sell Ful for?"

535
00:20:26.708 --> 00:20:29.745
And he leans over to me
like he's telling a secret.

536
00:20:29.849 --> 00:20:31.230
And he's like,
"Look, I'll tell you,

537
00:20:31.333 --> 00:20:32.507
"but you can't tell Mallory.

538
00:20:32.610 --> 00:20:33.853
"You know, I just don't
want Mallory to know

539
00:20:33.956 --> 00:20:35.164
exactly how much it is."

540
00:20:35.268 --> 00:20:38.789
And he leans over and tells me
he sold it for $11 million.

541
00:20:38.892 --> 00:20:40.342
So, you know, in my head,
I was like,

542
00:20:40.446 --> 00:20:42.379
okay, you know,
I just met this guy.

543
00:20:42.482 --> 00:20:43.863
He wants to make
a movie in LA.

544
00:20:43.966 --> 00:20:46.106
And he's got 11 million bucks
in his--his pocket.

545
00:20:46.210 --> 00:20:48.316
You know,
he's my new best friend.

546
00:20:48.419 --> 00:20:49.800
You know what I mean?

547
00:20:49.903 --> 00:20:53.286
So this is someone I might
develop a relationship with.

548
00:20:55.737 --> 00:20:57.980
[soft music]

549
00:20:58.084 --> 00:21:01.260
So me and Zach spent
literally the next two weeks,

550
00:21:01.363 --> 00:21:04.435
day and night,
you know, dusk till dawn,

551
00:21:04.539 --> 00:21:06.472
thinking we're Ben Affleck,
Matt Damon.

552
00:21:06.575 --> 00:21:09.751
I mean, we're writing
script ideas and outlines.

553
00:21:09.854 --> 00:21:12.650
And you hear the story of how
they wrote their own script

554
00:21:12.754 --> 00:21:14.549
and made it big,
won the Oscar, and...

555
00:21:14.652 --> 00:21:16.136
- I just said to Matt,
losing would suck

556
00:21:16.240 --> 00:21:17.241
and winning would be
really scary.

557
00:21:17.345 --> 00:21:19.623
And it's really, really scary.

558
00:21:19.726 --> 00:21:21.349
- It's kind of who we thought
we were gonna be, you know?

559
00:21:21.452 --> 00:21:22.764
We were just a couple people

560
00:21:22.867 --> 00:21:24.628
just wanting to tackle
the Hollywood dream.

561
00:21:24.731 --> 00:21:28.010
- Who are some of your biggest
inspirations, acting wise?

562
00:21:28.114 --> 00:21:30.668
- I would say Tom Cruise,
for sure.

563
00:21:30.772 --> 00:21:32.567
You know,
he's--he's one of those guys

564
00:21:32.670 --> 00:21:36.674
that every single movie
he's in, he's good.

565
00:21:36.778 --> 00:21:39.988
Leo is amazing.

566
00:21:40.091 --> 00:21:41.472
I mean, he is--he's just--

567
00:21:41.576 --> 00:21:45.580
what he's able to do
is ungodly.

568
00:21:45.683 --> 00:21:48.341
- You don't get
these lines right,

569
00:21:48.445 --> 00:21:50.861
I'm gonna blow your
fucking brains out tonight.

570
00:21:50.964 --> 00:21:52.276
- And then more recently,

571
00:21:52.380 --> 00:21:54.313
Bradley Cooper, I think,
is incredible as well,

572
00:21:54.416 --> 00:21:55.900
especially "A Star Is Born"
that he just did.

573
00:21:56.004 --> 00:21:58.662
I mean, writing it,
directing it, acting in it,

574
00:21:58.765 --> 00:22:01.043
totally transforming
into this guy,

575
00:22:01.147 --> 00:22:04.012
those are the performances
that I watch that I'm like,

576
00:22:04.115 --> 00:22:07.912
I'm in the right job,
because at some point,

577
00:22:08.016 --> 00:22:11.502
if I get even close to that,
everything's great.

578
00:22:11.606 --> 00:22:14.436
- You want answers.
- I want the truth!

579
00:22:14.540 --> 00:22:16.162
- He was my brother.

580
00:22:16.265 --> 00:22:19.303
And he was
one hell of a soldier.

581
00:22:19.407 --> 00:22:21.512
Everything he did,

582
00:22:21.616 --> 00:22:27.415
work, school, friendship,

583
00:22:27.518 --> 00:22:29.934
he did it 110%.

584
00:22:30.038 --> 00:22:34.353
I am completely
and utterly in love with you.

585
00:22:34.456 --> 00:22:36.803
I'm the man of the house now.

586
00:22:36.907 --> 00:22:38.667
You know why?

587
00:22:38.771 --> 00:22:41.705
'Cause you're just
a fucking child.

588
00:22:41.808 --> 00:22:44.673
[dark music]

589
00:22:44.777 --> 00:22:46.295
- Okay, so we have
this script in hand.

590
00:22:46.399 --> 00:22:48.332
And, you know,
what we learned is,

591
00:22:48.436 --> 00:22:49.816
you got to have
an actor attached.

592
00:22:49.920 --> 00:22:51.439
- It's got
a major star interested.

593
00:22:51.542 --> 00:22:53.337
- Which star?
- Who are the stars?

594
00:22:53.441 --> 00:22:55.615
- We need a male lead,
and we need him now.

595
00:22:55.719 --> 00:22:56.892
- Two.

596
00:22:56.996 --> 00:22:58.653
- And action.

597
00:22:58.756 --> 00:23:00.724
- You get
an A-list actor attached,

598
00:23:00.827 --> 00:23:04.141
that brings a certain value
to your movie--or a director.

599
00:23:04.244 --> 00:23:05.660
- Cut. Very good.

600
00:23:05.763 --> 00:23:07.524
- Right, 'cause if you get
the right director attached,

601
00:23:07.627 --> 00:23:09.802
then the right actor
will attach themselves.

602
00:23:09.905 --> 00:23:12.149
- Happy birthday,
you son of a bitch.

603
00:23:12.252 --> 00:23:14.393
- So since we didn't have
an A-list director attached,

604
00:23:14.496 --> 00:23:16.256
that made it
extremely difficult

605
00:23:16.360 --> 00:23:18.362
to get an A-list actor
attached.

606
00:23:18.466 --> 00:23:20.157
- No stars. Just talent.

607
00:23:20.260 --> 00:23:21.503
- No stars?

608
00:23:21.607 --> 00:23:23.540
- Yeah, this was like
six, seven, eight months

609
00:23:23.643 --> 00:23:26.197
of just grinding
and hitting the pavement,

610
00:23:26.301 --> 00:23:27.578
talking to everybody
under the sun,

611
00:23:27.682 --> 00:23:30.063
hearing their opinions
on how we should do it.

612
00:23:30.167 --> 00:23:31.617
It was exhausting.

613
00:23:31.720 --> 00:23:34.033
But this was just trying
to make it happen in LA.

614
00:23:36.518 --> 00:23:39.625
- What I think I understand
from Craig is that

615
00:23:39.728 --> 00:23:42.766
Zach's not offering to use
any of his "$11 million"

616
00:23:42.869 --> 00:23:44.457
to fund the movie that
he wants to make with Craig.

617
00:23:44.561 --> 00:23:46.770
That is key.

618
00:23:50.705 --> 00:23:52.603
- Zach created
a couple short films

619
00:23:52.707 --> 00:23:55.572
early on in his career
to try and get his name out.

620
00:23:55.675 --> 00:23:56.883
One was "The Laughing Man."

621
00:23:56.987 --> 00:23:59.472
- Mommy always said
I was different.

622
00:23:59.576 --> 00:24:01.681
- This is a fan-fiction
origin story on the Joker

623
00:24:01.785 --> 00:24:03.442
from the Batman series.

624
00:24:03.545 --> 00:24:05.305
And I remember
when it came out.

625
00:24:05.409 --> 00:24:08.861
And--you know,
it was pretty creepy.

626
00:24:08.964 --> 00:24:11.519
[disturbing music]

627
00:24:11.622 --> 00:24:15.730
[maniacal laughter]

628
00:24:15.833 --> 00:24:17.456
You know,
it went a little viral

629
00:24:17.559 --> 00:24:19.181
when--but that really got
his name out there

630
00:24:19.285 --> 00:24:21.287
and grabbed some attention.

631
00:24:21.390 --> 00:24:24.014
- I'm not gonna kill you.

632
00:24:24.117 --> 00:24:26.499
I'm just gonna hurt you--

633
00:24:26.603 --> 00:24:30.848
really, really bad.

634
00:24:32.850 --> 00:24:35.335
- Here's another entry
from Zach's blog.

635
00:24:35.439 --> 00:24:37.476
"My sister gave me
a framed picture

636
00:24:37.579 --> 00:24:39.892
"about ten years ago
that said,

637
00:24:39.995 --> 00:24:42.101
"'When the odds are
one in million,

638
00:24:42.204 --> 00:24:43.551
"be that one.'

639
00:24:43.654 --> 00:24:44.793
"This was the impetus

640
00:24:44.897 --> 00:24:46.899
"for naming my company
what it was named.

641
00:24:47.002 --> 00:24:48.487
"I absolutely love
this phrase,

642
00:24:48.590 --> 00:24:50.523
"and I believe it can be
a driving force

643
00:24:50.627 --> 00:24:54.803
for positivity
and productivity."

644
00:24:54.907 --> 00:24:57.116
Wow.

645
00:24:57.219 --> 00:25:00.188
[soft music]

646
00:25:00.291 --> 00:25:04.157
♪

647
00:25:04.261 --> 00:25:05.745
- Cool?
- Yes.

648
00:25:05.849 --> 00:25:06.746
- Great.

649
00:25:06.850 --> 00:25:08.403
- My name is John Verrastro.

650
00:25:08.507 --> 00:25:10.336
I'm a Special Agent
with the FBI

651
00:25:10.439 --> 00:25:12.821
in the Los Angeles
field office.

652
00:25:12.925 --> 00:25:14.513
High-yield investment fraud
and Ponzi schemes

653
00:25:14.616 --> 00:25:17.101
are common in Los Angeles.

654
00:25:17.205 --> 00:25:21.623
The size and scope
of this one is quite unique.

655
00:25:21.727 --> 00:25:24.177
Zach Horwitz was
purportedly purchasing

656
00:25:24.281 --> 00:25:25.524
the rights to various movies.

657
00:25:25.627 --> 00:25:27.767
And then he was
licensing these rights

658
00:25:27.871 --> 00:25:32.531
to Netflix, HBO, and then
other distribution platforms.

659
00:25:34.947 --> 00:25:37.397
- Somehow, he seems
to have gotten ahold

660
00:25:37.501 --> 00:25:40.815
of legitimate film licensing

661
00:25:40.918 --> 00:25:43.852
and film
distribution contracts

662
00:25:43.956 --> 00:25:48.547
that Netflix, HBO,
or others were using.

663
00:25:48.650 --> 00:25:52.620
Once he had legitimate
contracts in his hands,

664
00:25:52.723 --> 00:25:55.933
then he was able
to take it and run.

665
00:25:57.521 --> 00:25:59.074
And that's exactly
what he did.

666
00:26:05.840 --> 00:26:09.222
- Zach Horwitz started this
mostly, you know, utilizing,

667
00:26:09.326 --> 00:26:10.707
like, friends and family

668
00:26:10.810 --> 00:26:12.916
as his initial set
of investors.

669
00:26:14.745 --> 00:26:16.575
- Zach gave me the opportunity

670
00:26:16.678 --> 00:26:19.163
to become an investor
in 1inMM.

671
00:26:19.267 --> 00:26:22.753
So he says, "Craig, I think
I can get you in, you know?

672
00:26:22.857 --> 00:26:24.375
I think you can invest."

673
00:26:24.479 --> 00:26:26.895
So my thought process is,
of course.

674
00:26:26.999 --> 00:26:30.485
These are deals with Netflix,
HBO, Howard Schultz.

675
00:26:30.589 --> 00:26:31.866
They're doing them.

676
00:26:31.969 --> 00:26:34.144
And now I have
that same opportunity

677
00:26:34.247 --> 00:26:36.664
to become an investor
in this same platform

678
00:26:36.767 --> 00:26:38.942
that Zach has created?

679
00:26:40.357 --> 00:26:42.117
No-brainer. Right?

680
00:26:42.221 --> 00:26:44.464
I don't think twice.

681
00:26:44.568 --> 00:26:47.364
I take out my savings that
I have in a real estate fund.

682
00:26:47.467 --> 00:26:49.055
And I give it to Zach.

683
00:26:49.159 --> 00:26:51.782
And I become the first
investor in 1inMM Capital.

684
00:26:51.886 --> 00:26:55.337
[sentimental music]

685
00:26:55.441 --> 00:26:57.408
- My wife and I are
always looking for ways

686
00:26:57.512 --> 00:26:59.618
to earn passive income.

687
00:26:59.721 --> 00:27:01.171
I had invested in real estate

688
00:27:01.274 --> 00:27:03.794
and in a few small companies
here and there.

689
00:27:03.898 --> 00:27:06.176
And so I was looking
for other investments.

690
00:27:09.697 --> 00:27:12.527
Scott Cohen,
a good friend of mine,

691
00:27:12.631 --> 00:27:15.323
he said, there's some
opportunity in film.

692
00:27:15.426 --> 00:27:17.394
And I am a screenwriter.

693
00:27:17.497 --> 00:27:18.775
So I was intrigued.

694
00:27:18.878 --> 00:27:21.018
And he sent me, like,
an investor pack.

695
00:27:21.122 --> 00:27:22.951
When I first saw
the business plan,

696
00:27:23.055 --> 00:27:25.816
it was, as most are, just
sunshine and roses, right?

697
00:27:25.920 --> 00:27:29.889
It's all the positive aspects
of this deal.

698
00:27:29.993 --> 00:27:31.650
- What was going on
in my head then

699
00:27:31.753 --> 00:27:34.376
was not how good a salesman
this guy was.

700
00:27:34.480 --> 00:27:37.207
It was that there was HBO
and Netflix and these films.

701
00:27:37.310 --> 00:27:38.726
Like, why would I
have to trust him?

702
00:27:38.829 --> 00:27:40.348
I see these contracts.

703
00:27:40.451 --> 00:27:41.729
- Right away, I said to him,

704
00:27:41.832 --> 00:27:45.042
"How do we know
this isn't a Ponzi scheme?"

705
00:27:45.146 --> 00:27:46.941
And the answer I got back
was just that,

706
00:27:47.044 --> 00:27:48.770
"Of course it isn't,
and here's why."

707
00:27:48.874 --> 00:27:53.257
And I trusted that.

708
00:27:53.361 --> 00:27:55.535
- In its most simple form,
the Ponzi scheme

709
00:27:55.639 --> 00:27:59.367
is the money part of a scam.

710
00:27:59.988 --> 00:28:02.404
My name's Supervisory
Special Agent Doug Thompson.

711
00:28:02.508 --> 00:28:06.201
And I work with the FBI
in the White Collar unit.

712
00:28:06.305 --> 00:28:07.686
The money comes in.

713
00:28:07.789 --> 00:28:10.550
And that money is used
to pay returns.

714
00:28:10.654 --> 00:28:12.138
There's no actual business
going on.

715
00:28:12.242 --> 00:28:14.416
There's no profits
in most of these cases.

716
00:28:14.520 --> 00:28:18.317
And those payments
that the investors believe

717
00:28:18.420 --> 00:28:21.458
are the profits are actually
just the initial capital

718
00:28:21.561 --> 00:28:22.839
that the investors gave.

719
00:28:22.942 --> 00:28:25.048
New investors are
paying old investors.

720
00:28:25.151 --> 00:28:27.671
You have to have a scheme
to defraud the folks

721
00:28:27.775 --> 00:28:29.086
whose money you're taking.

722
00:28:29.190 --> 00:28:32.089
So when you've
misrepresented to them

723
00:28:32.193 --> 00:28:33.608
what you're gonna
take the money for,

724
00:28:33.712 --> 00:28:35.058
you accept the money,

725
00:28:35.161 --> 00:28:37.129
now you've gone down the road
of committing fraud.

726
00:28:39.407 --> 00:28:42.997
- I met Zach Avery when I was
raising money for venture.

727
00:28:43.100 --> 00:28:47.967
And he was part of the VC team
that invested.

728
00:28:48.071 --> 00:28:50.487
He didn't come across
as, like, a tech guy.

729
00:28:50.590 --> 00:28:53.697
So I just assumed, like,
yeah, he's a trust fund kid.

730
00:28:53.801 --> 00:28:55.250
You know, he's charming.

731
00:28:55.354 --> 00:28:57.666
And he was able
to kind of talk enough,

732
00:28:57.770 --> 00:29:01.360
like, venture, talk enough,
like, Hollywood.

733
00:29:01.463 --> 00:29:03.880
It's kind of, like,
a hot place to be right now,

734
00:29:03.983 --> 00:29:05.502
is being able to move
between those worlds.

735
00:29:05.605 --> 00:29:07.849
And, you know, you see
folks like Ryan Reynolds...

736
00:29:07.953 --> 00:29:09.230
- You're an actor.

737
00:29:09.333 --> 00:29:11.335
You're the owner
of cell carrier Mint Mobile.

738
00:29:11.439 --> 00:29:14.442
- Jessica Alba,
with the Honest Company.

739
00:29:14.545 --> 00:29:16.306
Snoop Dogg is another one.

740
00:29:16.409 --> 00:29:18.929
They have all done very well
being an investor

741
00:29:19.033 --> 00:29:22.691
and also an entrepreneur
and also an actor.

742
00:29:22.795 --> 00:29:24.417
Zach, you know, he played
that character well,

743
00:29:24.521 --> 00:29:25.625
that, "Hey, I'm this guy

744
00:29:25.729 --> 00:29:29.768
that can do a little bit
of everything."

745
00:29:29.871 --> 00:29:32.287
- What's the difference
between a pyramid scheme

746
00:29:32.391 --> 00:29:33.875
and a Ponzi scheme?

747
00:29:33.979 --> 00:29:35.566
- They're related.

748
00:29:35.670 --> 00:29:37.085
- Okay.
- Okay?

749
00:29:37.189 --> 00:29:41.262
And I would say that you might
classify a Ponzi scheme

750
00:29:41.365 --> 00:29:44.265
as sort of the evil cousin
of the pyramid scheme.

751
00:29:44.368 --> 00:29:45.438
- All right.

752
00:29:45.542 --> 00:29:47.026
- In a Ponzi scheme,

753
00:29:47.130 --> 00:29:48.959
there's one person
running the show.

754
00:29:49.063 --> 00:29:51.686
So you got--
you got your con man.

755
00:29:51.790 --> 00:29:53.067
- Okay.

756
00:29:53.170 --> 00:29:56.173
- Okay, let's call it ZH
for Zach Horwitz.

757
00:29:56.277 --> 00:29:58.175
And he comes up
with this scheme.

758
00:29:58.279 --> 00:30:02.317
And he's got friends
out there,

759
00:30:02.421 --> 00:30:03.871
potential investors.

760
00:30:06.770 --> 00:30:08.807
- A-B-C.

761
00:30:08.910 --> 00:30:11.637
A, Always, B, Be, C, Closing.

762
00:30:11.740 --> 00:30:13.777
Always Be Closing.

763
00:30:13.881 --> 00:30:17.160
Always Be Closing.

764
00:30:17.263 --> 00:30:19.472
- And he gets them to invest.

765
00:30:19.576 --> 00:30:21.233
So they put money in.

766
00:30:21.336 --> 00:30:23.442
- The entry level was
10 grand.

767
00:30:23.545 --> 00:30:25.858
- Okay, so he's taking in
at least 30 grand here.

768
00:30:25.962 --> 00:30:27.135
- Okay.
- Okay?

769
00:30:27.239 --> 00:30:29.137
And he's promising
that in six months,

770
00:30:29.241 --> 00:30:32.623
they'll get back their money
plus 15%, okay?

771
00:30:32.727 --> 00:30:33.693
That's a really good rate
of return.

772
00:30:33.797 --> 00:30:35.109
- Mm-hmm.

773
00:30:35.212 --> 00:30:37.766
- Your profit on a mere
$6,000 investment

774
00:30:37.870 --> 00:30:40.804
would be upwards of $60,000.

775
00:30:40.908 --> 00:30:42.599
- Now, how is he gonna
pay them back?

776
00:30:42.702 --> 00:30:44.912
So then he says, "Well, I got
to get some more money."

777
00:30:45.015 --> 00:30:48.847
So he goes out, finds
another group of investors.

778
00:30:48.950 --> 00:30:51.332
- We are looking to make
strategic relationships

779
00:30:51.435 --> 00:30:52.851
to move that along.

780
00:30:52.954 --> 00:30:54.853
But I kind of agree
with Mark Zuckerberg

781
00:30:54.956 --> 00:30:58.995
when he said,
"Move fast and break things."

782
00:30:59.098 --> 00:31:00.444
- Right?
- Uh-huh.

783
00:31:00.548 --> 00:31:02.101
- Okay.

784
00:31:02.205 --> 00:31:05.449
And then some of this money

785
00:31:05.553 --> 00:31:09.660
is going to pay off
the early investors, okay?

786
00:31:09.764 --> 00:31:11.007
But if you've upped the ante,

787
00:31:11.110 --> 00:31:12.456
it's no longer 10,000
to get in.

788
00:31:12.560 --> 00:31:15.563
You need 20,000 now
or 30,000 or 40,000.

789
00:31:15.666 --> 00:31:17.047
But these people might decide,

790
00:31:17.151 --> 00:31:19.187
"Well, I'm gonna just take
this money.

791
00:31:19.291 --> 00:31:22.087
It was a good deal,
so I'll just go in again."

792
00:31:22.190 --> 00:31:25.573
- I am talking about
giving you $100 million.

793
00:31:25.676 --> 00:31:29.818
- If you go above 4,
we might have something.

794
00:31:29.922 --> 00:31:31.268
- I can do that.

795
00:31:31.372 --> 00:31:33.581
- So he gets paid off
in principle.

796
00:31:33.684 --> 00:31:35.583
But he reinvests.

797
00:31:35.686 --> 00:31:37.516
Now, of course, these people
expect their money too.

798
00:31:37.619 --> 00:31:38.931
Okay?

799
00:31:39.035 --> 00:31:40.450
So then you go to--
you know, you keep doing it,

800
00:31:40.553 --> 00:31:42.624
especially since you're
draining some money out.

801
00:31:42.728 --> 00:31:44.557
So you have to get
more and more.

802
00:31:44.661 --> 00:31:47.388
As long as they think
that it's legitimate

803
00:31:47.491 --> 00:31:50.115
and that they are, in fact,
earning these returns...

804
00:31:50.218 --> 00:31:53.739
- I got a whole suite
full of mainframe computers.

805
00:31:53.842 --> 00:31:55.085
- We're not really interested,
Henry.

806
00:31:55.189 --> 00:31:57.467
- Oh, they are so beautiful.

807
00:31:57.570 --> 00:31:59.227
Listen to 'em hum.

808
00:31:59.331 --> 00:32:00.504
- [chuckles]

809
00:32:00.608 --> 00:32:04.267
Henry, don't try
Mr. Hemming's patience.

810
00:32:04.370 --> 00:32:07.028
- You sure?

811
00:32:07.132 --> 00:32:09.479
- It tends to feed on itself.

812
00:32:09.582 --> 00:32:13.655
And if that happens enough,
then you're in good shape.

813
00:32:13.759 --> 00:32:16.141
- The key to a Ponzi scheme
is getting more investors

814
00:32:16.244 --> 00:32:17.694
in the Ponzi scheme.

815
00:32:17.797 --> 00:32:21.008
There's a pattern to it,
where they identify the people

816
00:32:21.111 --> 00:32:22.319
they want to target.

817
00:32:22.423 --> 00:32:24.218
They build rapport with them.

818
00:32:24.321 --> 00:32:27.083
They convince them that
they've got this secret way

819
00:32:27.186 --> 00:32:30.086
of creating obscene amounts
of wealth.

820
00:32:30.189 --> 00:32:33.020
And that grooming part of this
is important,

821
00:32:33.123 --> 00:32:36.230
because it's not just
to get them to invest,

822
00:32:36.333 --> 00:32:38.646
but you want them
to bring in their friends

823
00:32:38.749 --> 00:32:42.512
and their social network.

824
00:32:42.615 --> 00:32:45.101
- There is a feeling
of exclusivity

825
00:32:45.204 --> 00:32:47.034
in that you've been
invited in.

826
00:32:47.137 --> 00:32:48.518
You've now joined this club.

827
00:32:48.621 --> 00:32:53.626
And there's always
this notion that,

828
00:32:53.730 --> 00:32:55.490
particularly in Ponzi schemes,

829
00:32:55.594 --> 00:32:58.148
there are only so many deals
to go around.

830
00:32:58.252 --> 00:33:01.289
- He just had
the Hollywood lingo down.

831
00:33:01.393 --> 00:33:04.292
And he had so much
bravado behind it,

832
00:33:04.396 --> 00:33:06.536
and he seemed to talk
the talk that, you know,

833
00:33:06.639 --> 00:33:08.641
people who were
outside of that world

834
00:33:08.745 --> 00:33:10.471
were susceptible to it.

835
00:33:10.574 --> 00:33:13.301
So I think in that respect,
that's how his scheme worked.

836
00:33:13.405 --> 00:33:14.544
- Oh, it's not a problem.

837
00:33:14.647 --> 00:33:16.718
A friend in need
is a friend indeed, right?

838
00:33:16.822 --> 00:33:18.272
- There was a sense
of intrigue

839
00:33:18.375 --> 00:33:20.895
that is beyond
the typical scheme,

840
00:33:20.999 --> 00:33:22.276
where someone says,

841
00:33:22.379 --> 00:33:24.347
"You're going to be investing
in the stock market."

842
00:33:24.450 --> 00:33:26.107
They don't know anything
about these companies.

843
00:33:26.211 --> 00:33:28.178
But they do all think they
know something about movies.

844
00:33:28.282 --> 00:33:30.732
And I think investors
enjoyed saying

845
00:33:30.836 --> 00:33:32.596
that they were investing
in films.

846
00:33:32.700 --> 00:33:35.565
- Most of the investors
investing in movies

847
00:33:35.668 --> 00:33:37.774
and in Hollywood
don't really understand

848
00:33:37.877 --> 00:33:39.707
how movies and Hollywood
really work.

849
00:33:39.810 --> 00:33:42.158
And that's where
Ponzi schemes,

850
00:33:42.261 --> 00:33:43.745
fraudsters live.

851
00:33:43.849 --> 00:33:46.955
They love to get in an area
where you know a little bit

852
00:33:47.059 --> 00:33:49.613
but you don't fully
understand it.

853
00:33:49.717 --> 00:33:52.789
- When you use actual,
real movie titles that exist,

854
00:33:52.892 --> 00:33:54.653
where somebody can go
and verify,

855
00:33:54.756 --> 00:33:57.794
"Okay, this seems legitimate,
and we can get these returns

856
00:33:57.897 --> 00:33:59.209
"because he's actually using

857
00:33:59.313 --> 00:34:00.555
"our money
to purchase these things,

858
00:34:00.659 --> 00:34:02.454
"and then he has these
existing agreements

859
00:34:02.557 --> 00:34:03.869
"where he's selling them
to them,

860
00:34:03.972 --> 00:34:06.527
so the money's gonna come in."

861
00:34:06.630 --> 00:34:08.977
- When it was presented to us,
it came from a company

862
00:34:09.081 --> 00:34:11.532
called JJMT out of Chicago.

863
00:34:11.635 --> 00:34:16.537
They were sort of the advisors
to us on account of 1inMM,

864
00:34:16.640 --> 00:34:18.884
which was the company
that was purportedly buying

865
00:34:18.987 --> 00:34:20.403
the rights to these films.

866
00:34:20.506 --> 00:34:23.785
And all of the members of JJMT
were in the finance sector.

867
00:34:23.889 --> 00:34:27.651
So as far as we understood,
they had vetted everything.

868
00:34:27.755 --> 00:34:31.069
And that lended credence
to this whole scheme.

869
00:34:33.519 --> 00:34:35.383
- The investors would ask,
"Well, what if you can't

870
00:34:35.487 --> 00:34:37.247
get it distributed
or something like that?"

871
00:34:37.351 --> 00:34:38.524
"Oh, you don't have
to worry about that.

872
00:34:38.628 --> 00:34:40.250
"There's some kind
of a fail-safe thing.

873
00:34:40.354 --> 00:34:43.046
Don't worry, it's always
a safe investment."

874
00:34:43.150 --> 00:34:46.256
- You had every bit
of documentation

875
00:34:46.360 --> 00:34:49.639
you could possibly imagine
to, you know, believe

876
00:34:49.742 --> 00:34:52.124
that you are,
you know, undertaking--

877
00:34:52.228 --> 00:34:53.746
putting your money
in an incredibly safe

878
00:34:53.850 --> 00:34:54.920
and secure investment.

879
00:34:55.023 --> 00:34:56.370
You know,
there was even clauses,

880
00:34:56.473 --> 00:34:58.061
if HBO doesn't pay
or Netflix pay,

881
00:34:58.165 --> 00:34:59.373
what would happen then?

882
00:34:59.476 --> 00:35:01.271
How would, you know,
we get our money back?

883
00:35:01.375 --> 00:35:03.722
And it was all laid out.

884
00:35:03.825 --> 00:35:04.895
- So in a case like this,

885
00:35:04.999 --> 00:35:06.414
with promissory notes
being used,

886
00:35:06.518 --> 00:35:09.210
at the expiration
of the promissory note,

887
00:35:09.314 --> 00:35:11.626
whether that was
in six months or a year,

888
00:35:11.730 --> 00:35:15.458
Zach Horwitz wired the funds
back to the victim investors.

889
00:35:15.561 --> 00:35:17.943
And then for the next note,
the victim investors

890
00:35:18.046 --> 00:35:20.635
would wire the money back.

891
00:35:20.739 --> 00:35:22.706
- You lend the money
for six months.

892
00:35:22.810 --> 00:35:26.434
You get the 35%, 40% return,
whatever it is.

893
00:35:26.538 --> 00:35:28.678
And then boom, you're out.
It's over.

894
00:35:28.781 --> 00:35:31.198
- So that was the thing.
I mean, I did get money.

895
00:35:31.301 --> 00:35:33.234
And, you know, I guess
I could have walked away.

896
00:35:33.338 --> 00:35:35.995
And--you know,
but it seemed legit, right?

897
00:35:36.099 --> 00:35:38.584
- And the other thing that was
always presented to us

898
00:35:38.688 --> 00:35:40.655
was that, these aren't
gonna last forever.

899
00:35:40.759 --> 00:35:44.003
At some point, there will be
other players in the game.

900
00:35:44.107 --> 00:35:47.455
And HBO or Netflix
will realize

901
00:35:47.559 --> 00:35:49.492
that they could cut
the middleman out.

902
00:35:49.595 --> 00:35:52.529
And Zach--Zach's whole
business would be gone.

903
00:35:52.633 --> 00:35:56.878
And so that was another thing
that got people to try and put

904
00:35:56.982 --> 00:36:00.330
as much money as they could in
as quickly as they could,

905
00:36:00.434 --> 00:36:04.507
because they knew that this
was a limited opportunity.

906
00:36:05.887 --> 00:36:09.028
- Around 2017, one of my
neighbors down the street

907
00:36:09.132 --> 00:36:12.756
told me the story about
these guys killing it in film.

908
00:36:12.860 --> 00:36:16.035
I had a production company
called Forager Film.

909
00:36:16.139 --> 00:36:17.589
We made a lot
of independent films

910
00:36:17.692 --> 00:36:21.351
starting in about 2013
and going forward.

911
00:36:22.214 --> 00:36:26.184
I've had a lot go to Sundance,
Berlin, South by Southwest.

912
00:36:26.287 --> 00:36:27.633
I definitely don't have
all the answers.

913
00:36:27.737 --> 00:36:29.911
So I always want to talk
to people about that.

914
00:36:30.015 --> 00:36:34.157
So in '17, we had two movies
going to Sundance.

915
00:36:34.261 --> 00:36:35.883
And I'm like,
"Two movies at Sundance.

916
00:36:35.986 --> 00:36:37.298
I know this business."

917
00:36:37.402 --> 00:36:40.784
Prior to '17,
we knew if we came in

918
00:36:40.888 --> 00:36:43.028
at a certain price point,
there'd be buyers out there.

919
00:36:43.131 --> 00:36:45.548
And the buyers weren't there
in '17.

920
00:36:45.651 --> 00:36:48.309
And so it was getting really
hard for us to sell movies.

921
00:36:48.413 --> 00:36:50.794
Then I come back
to the summer and he's saying,

922
00:36:50.898 --> 00:36:52.934
"Oh, these guys are
killing it in film."

923
00:36:53.038 --> 00:36:54.764
He's like, "Oh, no,
the guy would tell them

924
00:36:54.867 --> 00:36:56.248
"what Netflix would need.

925
00:36:56.352 --> 00:36:58.112
"And they'd go out
and either make the movie

926
00:36:58.216 --> 00:37:00.010
"or find the movie,
some foreign films.

927
00:37:00.114 --> 00:37:02.944
"And they would then turn
around and sell to Netflix.

928
00:37:03.048 --> 00:37:06.154
"And they're returning
some crazy amount of money

929
00:37:06.258 --> 00:37:07.673
all the time."

930
00:37:07.777 --> 00:37:09.951
And I'm going, wow,
I'm having a real tough time

931
00:37:10.055 --> 00:37:13.231
selling movies to Netflix,
Amazon, take your pick,

932
00:37:13.334 --> 00:37:14.853
because they want to make
their own films.

933
00:37:14.956 --> 00:37:16.234
- Hmm.

934
00:37:16.337 --> 00:37:17.304
So that was the first time
you kind of, like,

935
00:37:17.407 --> 00:37:18.684
"Wait a second,

936
00:37:18.788 --> 00:37:20.859
I know how this gets done,
and that's not it"?

937
00:37:20.962 --> 00:37:22.067
- Exactly.

938
00:37:22.170 --> 00:37:23.931
The story they were telling,

939
00:37:24.034 --> 00:37:25.243
they were telling
a lot of people.

940
00:37:25.346 --> 00:37:27.624
And they were hitting
the North Shore,

941
00:37:27.728 --> 00:37:29.557
where there's a lot of wealth
and that kind of thing.

942
00:37:29.661 --> 00:37:31.594
And my neighbor was
really seriously

943
00:37:31.697 --> 00:37:33.251
looking into this at the time.

944
00:37:33.354 --> 00:37:34.355
He goes, "Well, I think
I'm gonna do something."

945
00:37:34.459 --> 00:37:36.426
And I was like, "Okay."

946
00:37:36.530 --> 00:37:38.048
- So when you say,
"do something,"

947
00:37:38.152 --> 00:37:39.326
like, give them money?

948
00:37:39.429 --> 00:37:40.465
- Yeah, he was gonna
give them money,

949
00:37:40.568 --> 00:37:42.398
about $50,000 at the time

950
00:37:42.501 --> 00:37:44.227
because the returns
they were talking about

951
00:37:44.331 --> 00:37:45.849
were, like, close to 100%.

952
00:37:45.953 --> 00:37:48.162
You could do that
once or twice in movies.

953
00:37:48.266 --> 00:37:49.991
But consistently?

954
00:37:50.095 --> 00:37:54.064
Why wouldn't Netflix
figure this out and, like--

955
00:37:54.168 --> 00:37:55.618
- Doesn't smell right.
- Exactly.

956
00:37:55.721 --> 00:37:57.965
There was nothing good
that was gonna come of it.

957
00:38:01.279 --> 00:38:03.246
- I would see a title.

958
00:38:03.350 --> 00:38:05.455
Some of them were something
as ridiculous

959
00:38:05.559 --> 00:38:06.939
as "Satanic Panic."

960
00:38:07.043 --> 00:38:09.459
[metal music]

961
00:38:09.563 --> 00:38:11.185
It's not a film
I was ever gonna watch.

962
00:38:11.289 --> 00:38:15.465
And it was most often
in HBO Latin America

963
00:38:15.569 --> 00:38:18.226
or the Latin American markets
for Netflix.

964
00:38:18.330 --> 00:38:21.920
So the library of films
from which he pulled

965
00:38:22.023 --> 00:38:25.164
consisted mainly of titles
we'd never hear of.

966
00:38:25.268 --> 00:38:28.029
And from what I understood,
that made sense, right?

967
00:38:28.133 --> 00:38:30.100
Like, a movie that didn't cost
a lot to make,

968
00:38:30.204 --> 00:38:33.103
the financiers would be happy
to get 4 million bucks for it.

969
00:38:33.207 --> 00:38:34.277
And then we would pay for it,

970
00:38:34.381 --> 00:38:35.554
we would own
the rights to that,

971
00:38:35.658 --> 00:38:36.969
and then the streaming company
would give us

972
00:38:37.073 --> 00:38:38.454
this amount back.

973
00:38:38.557 --> 00:38:41.422
So I think that was one
of the smart things he did,

974
00:38:41.526 --> 00:38:42.941
was to use obscure titles

975
00:38:43.044 --> 00:38:45.806
that we would never
really know or even check on.

976
00:38:45.909 --> 00:38:47.601
[tense music]

977
00:38:47.704 --> 00:38:50.189
- Zach had a spider web
of lies he would tell

978
00:38:50.293 --> 00:38:53.848
to help his image,
his persona.

979
00:38:53.952 --> 00:38:56.610
He was always building
these lies up,

980
00:38:56.713 --> 00:39:00.165
that he was this
wildly successful investor,

981
00:39:00.268 --> 00:39:02.340
multiple business owner.

982
00:39:02.443 --> 00:39:04.549
Then from
a friends standpoint,

983
00:39:04.652 --> 00:39:06.723
this person had grown to be,

984
00:39:06.827 --> 00:39:09.485
you know, my closest
and best friend in LA.

985
00:39:09.588 --> 00:39:12.591
How do you get
so close to somebody,

986
00:39:12.695 --> 00:39:16.215
look someone in the eye,
and, you know,

987
00:39:16.319 --> 00:39:18.908
know that it's just not real?

988
00:39:19.011 --> 00:39:22.774
- It's too easy.
It's just too easy.

989
00:39:22.877 --> 00:39:25.949
- Hollywood has
an allure to criminals.

990
00:39:26.053 --> 00:39:28.918
They want to own homes
in Hollywood Hills

991
00:39:29.021 --> 00:39:30.195
and in Brentwood.

992
00:39:30.298 --> 00:39:32.024
They want to drive
expensive cars.

993
00:39:32.128 --> 00:39:36.374
And they want to be part
of that entire scene.

994
00:39:36.477 --> 00:39:37.961
- I got way too drunk,
stupidly hooked up

995
00:39:38.065 --> 00:39:40.826
with some girl
I had no business being with.

996
00:39:40.930 --> 00:39:42.138
The end.

997
00:39:43.346 --> 00:39:45.555
- Zach wanted to be famous.

998
00:39:45.659 --> 00:39:49.525
But unfortunately for Zach,

999
00:39:49.628 --> 00:39:53.183
he's a pretty fucking
terrible actor.

1000
00:39:53.287 --> 00:39:56.152
- [sputtering]

1001
00:39:58.844 --> 00:40:01.951
- Zach Horwitz,
that was his greatest role.

1002
00:40:02.054 --> 00:40:06.058
The real Zach
is closer to Zach Avery.

1003
00:40:06.162 --> 00:40:07.405
That's a cheater.

1004
00:40:07.508 --> 00:40:09.510
It's a liar.
It's a psychopath.

1005
00:40:09.614 --> 00:40:11.857
That's the real Zach.

1006
00:40:11.961 --> 00:40:16.414
- Zach was great at being
convincing to everyone,

1007
00:40:16.517 --> 00:40:18.139
except when he was on camera.

1008
00:40:20.176 --> 00:40:23.006
[gunshots]

1009
00:40:23.110 --> 00:40:24.905
- One of the mysteries was,

1010
00:40:25.008 --> 00:40:27.804
how is he getting these parts
in the first place?

1011
00:40:27.908 --> 00:40:30.324
- Do I know you?

1012
00:40:30.428 --> 00:40:32.637
- I'm the guy.

1013
00:40:32.740 --> 00:40:35.778
- What else is coming
down the pipe for you?

1014
00:40:36.744 --> 00:40:37.745
- We're gonna talk about

1015
00:40:37.849 --> 00:40:39.575
"The Last Moment of Clarity"
today.

1016
00:40:39.678 --> 00:40:42.060
Brian Cox, how did he
make you feel on the set?

1017
00:40:42.163 --> 00:40:43.441
- He was incredible.

1018
00:40:43.544 --> 00:40:44.994
He's just such a master
at his craft.

1019
00:40:45.097 --> 00:40:46.236
- "Gateway."
- Yeah.

1020
00:40:46.340 --> 00:40:48.238
- Olivia Munn.
- Dahlia!

1021
00:40:48.342 --> 00:40:49.895
- Mike?
Oh!

1022
00:40:49.999 --> 00:40:51.449
- This amazing talent,
do you just feel like

1023
00:40:51.552 --> 00:40:52.450
it forces you to up your game
immediately?

1024
00:40:52.553 --> 00:40:53.727
- It does.

1025
00:40:53.830 --> 00:40:55.660
It completely elevates
every single thing

1026
00:40:55.763 --> 00:40:57.351
you're doing because you know

1027
00:40:57.455 --> 00:40:59.664
you can't just
kind of phone it in.

1028
00:40:59.767 --> 00:41:03.599
- It started to look to me
like maybe he was putting

1029
00:41:03.702 --> 00:41:07.706
money from the Ponzi scheme
into the movies

1030
00:41:07.810 --> 00:41:10.882
to get the producers
to cast him.

1031
00:41:10.985 --> 00:41:12.746
- When it comes
to living in LA,

1032
00:41:12.849 --> 00:41:16.059
there's an undeniable pressure
to be somebody.

1033
00:41:16.163 --> 00:41:19.373
And I think
that pressure breaks people.

1034
00:41:19.477 --> 00:41:23.135
For Zach, it was very obvious
that he didn't want to wait.

1035
00:41:26.000 --> 00:41:27.070
- They're coming.

1036
00:41:27.174 --> 00:41:28.762
- Stay here.

1037
00:41:28.865 --> 00:41:30.936
- If you go on these auditions
the normal way,

1038
00:41:31.040 --> 00:41:33.629
I mean, you're gonna be going
on auditions a long time,

1039
00:41:33.732 --> 00:41:35.423
you know,
unless you just get lucky

1040
00:41:35.527 --> 00:41:37.322
and you're
that one in a million.

1041
00:41:37.425 --> 00:41:38.875
I'll tell you what,
any role he got,

1042
00:41:38.979 --> 00:41:42.292
it wasn't for his ability
in the audition.

1043
00:41:42.396 --> 00:41:44.985
- "Oh, ho, ho, coffee."

1044
00:41:45.088 --> 00:41:46.469
Remember B Man?

1045
00:41:46.573 --> 00:41:48.540
That dude from first-year
contracts class?

1046
00:41:48.644 --> 00:41:51.060
"Stomp on those bananas."

1047
00:41:52.924 --> 00:41:56.341
- As far as the ability
to cut a check...

1048
00:41:56.444 --> 00:41:57.411
- Yeah.
- Money talks.

1049
00:41:57.515 --> 00:41:59.206
- Well, yeah, definitely.

1050
00:41:59.309 --> 00:42:01.898
- Zach found that shortcut,
that way around

1051
00:42:02.002 --> 00:42:03.624
the one in a million
opportunity.

1052
00:42:03.728 --> 00:42:05.799
And he was buying
his way into roles.

1053
00:42:05.902 --> 00:42:08.387
Every single role,
whether it's major or minor,

1054
00:42:08.491 --> 00:42:11.563
Zach paid for
using investor funds.

1055
00:42:11.667 --> 00:42:12.806
- You may have
impressed someone.

1056
00:42:12.909 --> 00:42:14.428
You may have met someone
that I'm like,

1057
00:42:14.532 --> 00:42:16.844
"He doesn't fit for this
or I'm not gonna

1058
00:42:16.948 --> 00:42:19.260
bring him on to this project
because X, Y, or Z."

1059
00:42:19.364 --> 00:42:20.745
- I want to show you
something.

1060
00:42:20.848 --> 00:42:23.161
- "But I'm also doing
something in a month

1061
00:42:23.264 --> 00:42:24.749
"or someone else is doing
something that I know

1062
00:42:24.852 --> 00:42:26.854
that he may fit for."

1063
00:42:26.958 --> 00:42:29.236
- He began
creating relationships

1064
00:42:29.339 --> 00:42:30.720
with these producers.

1065
00:42:30.824 --> 00:42:32.929
And producers would say,
"Hey, well, I can get you,

1066
00:42:33.033 --> 00:42:35.380
you know, in this role
if you can give me X amount."

1067
00:42:35.483 --> 00:42:37.002
And he would pay it freely.

1068
00:42:37.106 --> 00:42:42.007
We're talking $100,000,
$200,000 for a small role.

1069
00:42:45.252 --> 00:42:47.841
- There were at least
four movies that he was in

1070
00:42:47.944 --> 00:42:50.291
that the Securities
and Exchange Commission

1071
00:42:50.395 --> 00:42:55.124
has confirmed that he used
proceeds from the Ponzi scheme

1072
00:42:55.227 --> 00:42:58.852
to help finance the movies
that he was cast in.

1073
00:42:58.955 --> 00:43:01.440
The exact amount is
not exactly clear.

1074
00:43:01.544 --> 00:43:03.477
But it's somewhere
in the $10 million,

1075
00:43:03.581 --> 00:43:05.617
$20 million range.

1076
00:43:05.721 --> 00:43:07.585
- I want to kind of get
into "The White Crow,"

1077
00:43:07.688 --> 00:43:09.379
directed by Ralph Fiennes--

1078
00:43:09.483 --> 00:43:12.141
and I wish I knew him,
and you do.

1079
00:43:12.244 --> 00:43:14.799
But what was it like to--
to work on that film?

1080
00:43:14.902 --> 00:43:16.973
- Yeah, it really was

1081
00:43:17.077 --> 00:43:18.388
an eye-opening experience
for me.

1082
00:43:18.492 --> 00:43:19.631
Yeah.

1083
00:43:19.735 --> 00:43:21.357
My specific role,
it's a guy named Michael.

1084
00:43:21.460 --> 00:43:23.946
He's an American journalist
that essentially was getting

1085
00:43:24.049 --> 00:43:27.225
the American perspective
on this kind of journey.

1086
00:43:28.778 --> 00:43:30.435
- Just having
that little glimpse

1087
00:43:30.538 --> 00:43:32.748
of seeing his face
on the big screen,

1088
00:43:32.851 --> 00:43:35.647
you know, it was all worth it
for him.

1089
00:43:35.751 --> 00:43:37.615
- Every new project
you go into,

1090
00:43:37.718 --> 00:43:40.100
you're nervous
because as you grow also,

1091
00:43:40.203 --> 00:43:42.171
I start thinking, like,
am I gonna be good in this?

1092
00:43:42.274 --> 00:43:43.482
Do I know what I'm doing?

1093
00:43:43.586 --> 00:43:44.760
You have
that imposter syndrome,

1094
00:43:44.863 --> 00:43:46.244
where it's like,
am I supposed to be here?

1095
00:43:46.347 --> 00:43:49.074
Are they gonna find out that
I'm this fraud the whole time?

1096
00:43:49.178 --> 00:43:52.664
- He was flying private jets
out to the sets.

1097
00:43:52.768 --> 00:43:55.529
One of the stories was
about him going out to film

1098
00:43:55.633 --> 00:43:57.186
a movie in Kentucky.

1099
00:43:57.289 --> 00:43:59.809
He arrived there
and I believe got paid

1100
00:43:59.913 --> 00:44:02.709
less than what he spent
on his accommodations.

1101
00:44:02.812 --> 00:44:04.055
- That's what happened here.

1102
00:44:06.057 --> 00:44:10.268
- Selling these
very unbelievable schemes,

1103
00:44:10.371 --> 00:44:12.201
I don't think
it's that hard in Hollywood

1104
00:44:12.304 --> 00:44:15.549
because people deal
with extraordinary stories

1105
00:44:15.653 --> 00:44:16.964
all the time.

1106
00:44:17.068 --> 00:44:19.380
And so there's a part of it
that makes it very easy,

1107
00:44:19.484 --> 00:44:21.555
where people are
very optimistic

1108
00:44:21.659 --> 00:44:23.281
and anything's possible.

1109
00:44:23.384 --> 00:44:24.869
[soft music]

1110
00:44:24.972 --> 00:44:26.042
- In many of these cases,

1111
00:44:26.146 --> 00:44:27.561
and in this case
in particular,

1112
00:44:27.665 --> 00:44:30.944
you build your credibility
through the people around you.

1113
00:44:31.047 --> 00:44:33.118
And then just over time,
it gets larger.

1114
00:44:33.222 --> 00:44:35.258
And as it appears to work,
you know,

1115
00:44:35.362 --> 00:44:37.502
more people, you know,
believe in it

1116
00:44:37.605 --> 00:44:39.987
and then start investing
in it.

1117
00:44:42.507 --> 00:44:44.854
- So I started to see Zach--
on his Instagram,

1118
00:44:44.958 --> 00:44:46.684
he's going
to Berlin Film Festival

1119
00:44:46.787 --> 00:44:49.617
and South by Southwest
and Cannes.

1120
00:44:49.721 --> 00:44:51.930
And I'm just like,
you know, damn.

1121
00:44:53.035 --> 00:44:54.968
I'm just kind of working away,

1122
00:44:55.071 --> 00:44:57.625
you know, at my kind of
original job in Orange County,

1123
00:44:57.729 --> 00:45:00.870
and I'm seeing Zach just--
just kind of living the dream.

1124
00:45:00.974 --> 00:45:04.115
You know, his cars improve
and house improve.

1125
00:45:04.218 --> 00:45:05.806
And I just couldn't
believe it, man.

1126
00:45:05.910 --> 00:45:08.982
It was cool to see.

1127
00:45:09.085 --> 00:45:11.881
- One of the important factors
for investors

1128
00:45:11.985 --> 00:45:14.884
is to see that, hey,
the guy has a track record.

1129
00:45:14.988 --> 00:45:17.093
And to prove that,
look at where he lives.

1130
00:45:17.197 --> 00:45:18.819
Look at his family.
Look at the cars.

1131
00:45:18.923 --> 00:45:20.338
Look at the watches.

1132
00:45:20.441 --> 00:45:21.960
I mean, who else has
a watch subscription service?

1133
00:45:22.064 --> 00:45:23.513
Why not buy a damn watch?

1134
00:45:23.617 --> 00:45:25.067
Why not have
a collection of watches?

1135
00:45:25.170 --> 00:45:28.484
He did all the things
to have the appearance

1136
00:45:28.587 --> 00:45:33.006
that he was the most
successful person he could be.

1137
00:45:33.109 --> 00:45:35.767
- In the era of social media,
you can create yourself

1138
00:45:35.871 --> 00:45:38.770
to be whatever you want.

1139
00:45:38.874 --> 00:45:41.152
The character of Zach Avery
kind of fit the mold

1140
00:45:41.255 --> 00:45:44.880
of that new kind
of con artist,

1141
00:45:44.983 --> 00:45:47.710
where you can
leverage technology

1142
00:45:47.814 --> 00:45:49.885
to be whoever you want
in this world.

1143
00:45:49.988 --> 00:45:53.336
- I think the persona
that Zach had

1144
00:45:53.440 --> 00:45:54.613
rather carefully fashioned

1145
00:45:54.717 --> 00:45:58.100
was important for him
to attract money.

1146
00:45:58.203 --> 00:46:00.516
I think he needed people
to see him that way.

1147
00:46:00.619 --> 00:46:02.552
And then, of course,
it was also important to him

1148
00:46:02.656 --> 00:46:05.970
to present the husband he had
promised his wife to be,

1149
00:46:06.073 --> 00:46:07.557
that he was
gonna be successful,

1150
00:46:07.661 --> 00:46:08.869
that he was this great actor.

1151
00:46:08.973 --> 00:46:12.700
[melancholy music]

1152
00:46:12.804 --> 00:46:14.875
- Zach marries Mallory.

1153
00:46:14.979 --> 00:46:18.361
And they have two kids.

1154
00:46:18.465 --> 00:46:21.813
He's just living a lifestyle
now that, honestly,

1155
00:46:21.917 --> 00:46:23.228
only some of us dream about.

1156
00:46:23.332 --> 00:46:26.335
- This is on my Insta story.
Relax. Hold on.

1157
00:46:26.438 --> 00:46:30.166
- And you got to witness this
at every major life event

1158
00:46:30.270 --> 00:46:31.719
that Zach and Mallory have.

1159
00:46:31.823 --> 00:46:33.238
[cheers and applause]

1160
00:46:33.342 --> 00:46:36.448
- For me, it's very clear
that you are

1161
00:46:36.552 --> 00:46:39.141
an absolutely amazing mother.

1162
00:46:39.244 --> 00:46:40.349
- Whoo!

1163
00:46:40.452 --> 00:46:43.524
- You're an absolutely
amazing wife,

1164
00:46:43.628 --> 00:46:45.975
amazing friend...
- Yes.

1165
00:46:46.079 --> 00:46:47.597
- And an absolutely
amazing person.

1166
00:46:47.701 --> 00:46:49.289
- Whoo!

1167
00:46:49.392 --> 00:46:52.464
- So I fell in love with you
14 days before you turned 20.

1168
00:46:52.568 --> 00:46:54.432
[laughter]

1169
00:46:54.535 --> 00:46:57.435
- Whoo!
- Whoo!

1170
00:46:57.538 --> 00:47:01.163
- And now I've been with you
10 years and 14 days.

1171
00:47:01.266 --> 00:47:02.854
[laughter]

1172
00:47:02.958 --> 00:47:04.373
- Amazing.

1173
00:47:04.476 --> 00:47:06.237
- And I promise you,
I'm gonna love you

1174
00:47:06.340 --> 00:47:08.066
every fucking day
for the rest of my life.

1175
00:47:08.170 --> 00:47:12.381
[cheers and applause]
- Yeah, buddy.

1176
00:47:12.484 --> 00:47:14.107
- Mallory got serenaded.

1177
00:47:14.210 --> 00:47:16.523
And it was just
the most romantic

1178
00:47:16.626 --> 00:47:19.837
and probably intimate thing
I've ever been to.

1179
00:47:19.940 --> 00:47:21.390
You know, and it
honestly kind of made--

1180
00:47:21.493 --> 00:47:23.081
made all of us husbands
and boyfriends

1181
00:47:23.185 --> 00:47:24.565
kind of look bad
because, you know,

1182
00:47:24.669 --> 00:47:26.602
Zach put on quite the show.

1183
00:47:26.705 --> 00:47:31.331
And that was, I think,
the pinnacle of his success.

1184
00:47:31.434 --> 00:47:35.024
The closer you were to him,
the more you loved Zach,

1185
00:47:35.128 --> 00:47:39.201
the more he took advantage
of you.

1186
00:47:39.304 --> 00:47:41.893
- Do you think you could
love another woman?

1187
00:47:41.997 --> 00:47:43.515
- No, not if I have you.

1188
00:47:43.619 --> 00:47:45.897
You're one in million.

1189
00:47:50.488 --> 00:47:52.800
[soft dramatic music]

1190
00:47:52.904 --> 00:47:55.148
- As he was
drawing in investors,

1191
00:47:55.251 --> 00:47:56.390
the money he would bring in

1192
00:47:56.494 --> 00:47:57.978
would pay back
the earlier investors.

1193
00:47:58.082 --> 00:48:01.085
And you could reinvest
or you could cash out.

1194
00:48:01.188 --> 00:48:03.742
But the returns were so great
that people would reinvest.

1195
00:48:03.846 --> 00:48:06.780
- So you're constantly
just giving more.

1196
00:48:06.884 --> 00:48:08.402
You're never actually
making money.

1197
00:48:08.506 --> 00:48:11.405
You're just giving
more and more and more.

1198
00:48:12.648 --> 00:48:14.892
- After the first year or so,

1199
00:48:14.995 --> 00:48:16.169
you know the payments are
coming out.

1200
00:48:16.272 --> 00:48:17.687
They're coming out on time.

1201
00:48:17.791 --> 00:48:19.379
And everybody is
being made whole

1202
00:48:19.482 --> 00:48:21.070
and getting all the payments
that they were promised.

1203
00:48:21.174 --> 00:48:23.314
So we stopped
really paying attention.

1204
00:48:23.417 --> 00:48:26.110
- And he never act like
he needed the investment

1205
00:48:26.213 --> 00:48:28.595
or even wanted the investment.

1206
00:48:28.698 --> 00:48:29.907
He was always like, "Well,

1207
00:48:30.010 --> 00:48:31.598
I'll have to think about it,"
you know?

1208
00:48:31.701 --> 00:48:33.841
"Maybe. I don't know if I can.
We'll see."

1209
00:48:33.945 --> 00:48:35.982
You know, if you know
anything about sales,

1210
00:48:36.085 --> 00:48:37.880
you know "no's"
the strongest word in sales.

1211
00:48:37.984 --> 00:48:41.988
He was just an absolute
master manipulator.

1212
00:48:42.091 --> 00:48:43.299
- It seems oftentimes,

1213
00:48:43.403 --> 00:48:44.783
at least with
the Ponzi schemes

1214
00:48:44.887 --> 00:48:46.475
and these high-yield
investment frauds,

1215
00:48:46.578 --> 00:48:49.271
they don't really believe
that what they did was wrong.

1216
00:48:49.374 --> 00:48:51.790
Some of them actually believe
what they're doing is real,

1217
00:48:51.894 --> 00:48:54.517
even though
everything isn't real.

1218
00:48:54.621 --> 00:48:58.418
To these individuals,
the idea of itself being real

1219
00:48:58.521 --> 00:49:00.316
makes it real.

1220
00:49:00.903 --> 00:49:03.941
- But, of course, he's taking
the money out for himself.

1221
00:49:04.044 --> 00:49:08.117
And this is all
just a huge lie.

1222
00:49:11.327 --> 00:49:14.330
- The main reason
Ponzi schemes fail is,

1223
00:49:14.434 --> 00:49:17.816
the person running the scheme
is taking too much money out.

1224
00:49:17.920 --> 00:49:19.922
They will start purchasing
luxury items.

1225
00:49:20.026 --> 00:49:22.166
They'll buy cars, homes.

1226
00:49:22.269 --> 00:49:23.477
They'll start developing

1227
00:49:23.581 --> 00:49:24.789
an entirely
different lifestyle

1228
00:49:24.892 --> 00:49:26.239
that's very extravagant.

1229
00:49:26.342 --> 00:49:28.724
They don't have
enough money coming in

1230
00:49:28.827 --> 00:49:31.554
to pay the Ponzi payment
because they've taken it.

1231
00:49:36.387 --> 00:49:39.424
- So here's another quote
from the blog.

1232
00:49:39.528 --> 00:49:42.876
"I was always obsessed
with belief in a superior life

1233
00:49:42.980 --> 00:49:45.913
"that existed
just beyond my grasp,

1234
00:49:46.017 --> 00:49:50.228
"a feeling that a better party
was happening somewhere else.

1235
00:49:50.332 --> 00:49:51.850
"But every once
in a while, however,

1236
00:49:51.954 --> 00:49:54.922
"this sensation was punctuated
by a visceral electric

1237
00:49:55.026 --> 00:49:59.582
sense of presence, times where
I truly felt like I belonged."

1238
00:50:02.654 --> 00:50:05.416
I am not sure
how to feel about this,

1239
00:50:05.519 --> 00:50:07.038
because, you know,

1240
00:50:07.142 --> 00:50:09.351
this is what he's choosing
to write about

1241
00:50:09.454 --> 00:50:13.769
while he's serving his 20-year
sentence in federal prison.

1242
00:50:13.872 --> 00:50:14.977
First of all,
I didn't even know

1243
00:50:15.081 --> 00:50:17.566
you could have a blog
in prison.

1244
00:50:17.669 --> 00:50:22.950
This is the very little,
subtle acknowledgment

1245
00:50:23.054 --> 00:50:24.780
of this scam that--

1246
00:50:24.883 --> 00:50:27.472
the closest thing he gets
to saying why he did it,

1247
00:50:27.576 --> 00:50:28.956
just because, you know,
there were times

1248
00:50:29.060 --> 00:50:30.786
when he felt like he belonged.

1249
00:50:34.617 --> 00:50:36.274
[indistinct chatter]

1250
00:50:36.378 --> 00:50:37.931
- If not, that's fine.

1251
00:50:38.035 --> 00:50:40.175
And actually--
I'm not exactly sure.

1252
00:50:40.278 --> 00:50:42.660
- Should I just look
in the lens?

1253
00:50:42.763 --> 00:50:44.282
- Hmm.

1254
00:50:44.386 --> 00:50:46.871
- I think there's something
especially sick about somebody

1255
00:50:46.974 --> 00:50:48.942
who could not only
take advantage

1256
00:50:49.046 --> 00:50:53.395
of their friends and family,
but use them as bait in a way.

1257
00:50:53.498 --> 00:50:56.432
- I don't know, like,
the psychology of this human

1258
00:50:56.536 --> 00:50:58.227
is fascinating.

1259
00:50:58.331 --> 00:51:02.576
- It's strange and curious
how somebody could have

1260
00:51:02.680 --> 00:51:04.337
that much confidence

1261
00:51:04.440 --> 00:51:06.822
and that little
of a conscience.

1262
00:51:06.925 --> 00:51:10.032
- I had some family members
lose their pensions

1263
00:51:10.136 --> 00:51:13.035
in the Bernie Madoff
Ponzi scheme,

1264
00:51:13.139 --> 00:51:14.554
which I'm sure
we all remember.

1265
00:51:14.657 --> 00:51:19.179
And I'm really curious
about the type of person

1266
00:51:19.283 --> 00:51:21.388
that could do that,
like, the egos involved

1267
00:51:21.492 --> 00:51:23.942
because I witnessed
the damage,

1268
00:51:24.046 --> 00:51:27.153
psychological and financial,
from the victims' side.

1269
00:51:27.256 --> 00:51:30.397
[somber music]

1270
00:51:30.501 --> 00:51:34.677
♪

1271
00:51:34.781 --> 00:51:36.714
- And come visit us
in Las Vegas when we re-open.

1272
00:51:36.817 --> 00:51:40.373
We'd love to have you.
- For sure. I'd love to come.

1273
00:51:40.476 --> 00:51:42.444
- In court,
one of his victims did say

1274
00:51:42.547 --> 00:51:47.173
that he had spent a weekend
with Zach in Las Vegas.

1275
00:51:48.277 --> 00:51:50.279
To take someone to Las Vegas

1276
00:51:50.383 --> 00:51:52.316
and hang out with them
for a weekend--

1277
00:51:52.419 --> 00:51:54.525
he's spending real
face-to-face time

1278
00:51:54.628 --> 00:51:55.526
with these people,

1279
00:51:55.629 --> 00:51:58.736
knowing that he's taking
their money

1280
00:51:58.839 --> 00:52:00.462
and never giving it back,

1281
00:52:00.565 --> 00:52:03.016
and these are
their life savings.

1282
00:52:03.120 --> 00:52:07.848
That struck me
as incredibly predatory.

1283
00:52:07.952 --> 00:52:10.886
He's really leaving
these people destitute.

1284
00:52:10.989 --> 00:52:13.544
- Knowing that, you know,
I'm not some hedge fund

1285
00:52:13.647 --> 00:52:14.993
or one of the big investors,
I mean,

1286
00:52:15.097 --> 00:52:16.788
why did you need my money?

1287
00:52:16.892 --> 00:52:18.169
Tell me how I'm gonna, like,

1288
00:52:18.273 --> 00:52:19.412
pay the bills
that I have to pay.

1289
00:52:19.515 --> 00:52:21.138
What am I gonna do
with the money

1290
00:52:21.241 --> 00:52:22.967
that I was supposed
to have been saving up?

1291
00:52:23.070 --> 00:52:24.382
I've read the houses
and the cars

1292
00:52:24.486 --> 00:52:26.073
and the luxury watch service.

1293
00:52:26.177 --> 00:52:27.730
How did you sleep at night?

1294
00:52:27.834 --> 00:52:29.939
Did you wonder if the cops
were gonna knock on the door?

1295
00:52:30.043 --> 00:52:32.149
Or did you even think
about that

1296
00:52:32.252 --> 00:52:35.152
when you were
going through all this?

1297
00:52:37.361 --> 00:52:39.535
- Lo and behold,
how Zach operated

1298
00:52:39.639 --> 00:52:41.779
with the people
closest to him,

1299
00:52:41.882 --> 00:52:45.438
he didn't want anybody
being friends with anybody.

1300
00:52:45.541 --> 00:52:48.234
Mallory and I, we were close
at the beginning.

1301
00:52:48.337 --> 00:52:51.789
But as time went on,
we were just a little distant.

1302
00:52:51.892 --> 00:52:54.032
I could tell there was
just something off.

1303
00:52:54.136 --> 00:52:55.793
And I couldn't put
my finger on it.

1304
00:52:55.896 --> 00:52:58.865
And come to find,

1305
00:52:58.968 --> 00:53:02.040
he was pinning everybody
against each other,

1306
00:53:02.144 --> 00:53:04.491
especially everybody close
in his life.

1307
00:53:04.595 --> 00:53:06.597
He didn't want me
talking too much to Mallory.

1308
00:53:06.700 --> 00:53:08.806
He didn't want her
talking to me either

1309
00:53:08.909 --> 00:53:10.048
because Zach knew

1310
00:53:10.152 --> 00:53:11.878
the more time I'd spend
with Mallory,

1311
00:53:11.981 --> 00:53:14.156
I'd start asking
more questions.

1312
00:53:14.260 --> 00:53:15.364
The more time I'd spend

1313
00:53:15.468 --> 00:53:17.021
with some of his other
LA friends

1314
00:53:17.124 --> 00:53:19.023
and some of his
acting friends,

1315
00:53:19.126 --> 00:53:21.612
and I'd bring up,
you know, 1inMM,

1316
00:53:21.715 --> 00:53:23.614
And then
they would ask questions.

1317
00:53:23.717 --> 00:53:28.274
So he kept everybody
on their own individual island

1318
00:53:28.377 --> 00:53:31.415
while he masterfully
manipulated them

1319
00:53:31.518 --> 00:53:33.279
and everyone around them.

1320
00:53:33.382 --> 00:53:36.558
We could all be
just his own personal pawns

1321
00:53:36.661 --> 00:53:37.731
in his own game.

1322
00:53:40.424 --> 00:53:41.563
- At this point in time,

1323
00:53:41.666 --> 00:53:43.875
the investment had grown
quite large.

1324
00:53:43.979 --> 00:53:46.223
The payment amounts that were
being sent back and forth,

1325
00:53:46.326 --> 00:53:49.329
they were
in the millions of dollars.

1326
00:53:49.433 --> 00:53:50.537
- I think there is

1327
00:53:50.641 --> 00:53:53.126
kind of a runaway
freight train quality

1328
00:53:53.230 --> 00:53:56.578
to what wound up happening.

1329
00:53:56.681 --> 00:54:00.547
- Zach was able to create this
aura around you of legitimacy

1330
00:54:00.651 --> 00:54:02.825
by associating
with other people,

1331
00:54:02.929 --> 00:54:06.415
like Howard Schultz,
who are legitimate.

1332
00:54:06.519 --> 00:54:09.867
- We were told that
Howard Schultz had bankrolled

1333
00:54:09.970 --> 00:54:11.558
his initial investments.

1334
00:54:11.662 --> 00:54:14.630
And from there,
the story went on

1335
00:54:14.734 --> 00:54:17.737
and became kind of this legend
of Zach.

1336
00:54:17.840 --> 00:54:20.878
- That's something that's been
missing from this story,

1337
00:54:20.981 --> 00:54:25.572
is how much this relationship
Zach conveyed he had

1338
00:54:25.676 --> 00:54:29.542
with Howard Schultz
and these very powerful people

1339
00:54:29.645 --> 00:54:32.890
was all a part
of Zach's persona.

1340
00:54:32.993 --> 00:54:35.824
- I dream the kind of dreams
that other people said

1341
00:54:35.927 --> 00:54:37.274
would not be possible.

1342
00:54:37.377 --> 00:54:38.516
- He'd have his phone out.

1343
00:54:38.620 --> 00:54:40.622
And his phone would
literally buzz.

1344
00:54:40.725 --> 00:54:41.864
[phone buzzes]

1345
00:54:41.968 --> 00:54:44.764
And he'd look at it and say,
"Oh, it's Howard again."

1346
00:54:44.867 --> 00:54:46.144
He would call him Howie.

1347
00:54:46.248 --> 00:54:47.629
Then he'd show
the text message.

1348
00:54:47.732 --> 00:54:50.356
Like, how are you supposed to
know this is fake, you know?

1349
00:54:50.459 --> 00:54:52.358
When you're seeing
live emails on his computer

1350
00:54:52.461 --> 00:54:54.325
and you're shown text messages

1351
00:54:54.429 --> 00:54:57.535
with their names and--
and you're even receiving--

1352
00:54:57.639 --> 00:55:01.298
supposedly receiving emails
from Howard Schultz himself.

1353
00:55:01.401 --> 00:55:03.541
These characters
in Zach's story

1354
00:55:03.645 --> 00:55:05.474
were so real to all of us.

1355
00:55:05.578 --> 00:55:08.201
It was uncanny how timely

1356
00:55:08.305 --> 00:55:11.446
these text messages
came in as well.

1357
00:55:11.549 --> 00:55:13.275
- We do take it at face value.

1358
00:55:13.379 --> 00:55:15.657
I find it hard to,
in my life, assume

1359
00:55:15.760 --> 00:55:17.383
that somebody is lying to me.

1360
00:55:17.486 --> 00:55:19.212
When I heard that
Howard Schultz was involved,

1361
00:55:19.316 --> 00:55:20.731
it made sense to me
in the sense

1362
00:55:20.834 --> 00:55:22.526
that this guy must have had
some money,

1363
00:55:22.629 --> 00:55:25.322
seed money, to start
somewhere along the line.

1364
00:55:25.425 --> 00:55:28.048
And that he had found himself
in a relationship

1365
00:55:28.152 --> 00:55:29.947
with Howard Schultz,
it's like,

1366
00:55:30.050 --> 00:55:33.122
seemed fortuitous for him,
but it certainly could happen.

1367
00:55:33.226 --> 00:55:36.160
[dramatic music]

1368
00:55:36.263 --> 00:55:43.063
♪

1369
00:55:44.927 --> 00:55:47.792
- Zach and I go out one night
just to hang out and--

1370
00:55:47.896 --> 00:55:49.449
at least what I thought
was just some--

1371
00:55:49.553 --> 00:55:51.900
some innocent fun,
just to catch up.

1372
00:55:55.352 --> 00:55:56.525
[phone dings]

1373
00:55:56.629 --> 00:55:58.838
He takes out his phone
and shows a live message

1374
00:55:58.941 --> 00:56:02.669
interaction with Ted Sarandos,
the man in charge of Netflix.

1375
00:56:02.773 --> 00:56:04.913
Ted Sarandos and him are
going back and forth.

1376
00:56:05.016 --> 00:56:08.606
And Ted asks Zach if he's
ready to sell his library yet.

1377
00:56:08.710 --> 00:56:12.748
He's got an over 400,
500 film library, supposedly,

1378
00:56:12.852 --> 00:56:16.303
that Ted would acquire
for anywhere from 400

1379
00:56:16.407 --> 00:56:18.375
to 700 grand apiece,

1380
00:56:18.478 --> 00:56:22.931
with 11, 12, 13 years left
of film rights.

1381
00:56:23.034 --> 00:56:25.589
And Zach responds with,
"It depends."

1382
00:56:25.692 --> 00:56:28.281
And then Ted responds with,
"Depends on what?"

1383
00:56:28.385 --> 00:56:30.525
And Zach says, "The zeros."

1384
00:56:30.628 --> 00:56:33.873
I'm seeing this
live on his phone.

1385
00:56:33.976 --> 00:56:36.531
Ted sends over an offer.

1386
00:56:38.429 --> 00:56:41.018
It's a massive offer.

1387
00:56:41.121 --> 00:56:44.435
Zach hits the floor,

1388
00:56:44.539 --> 00:56:48.232
falls down to his knees,
and starts crying.

1389
00:56:48.335 --> 00:56:52.616
♪

1390
00:56:52.719 --> 00:56:54.756
And he's saying,
"Craig, we made it.

1391
00:56:54.859 --> 00:56:55.964
We did it."

1392
00:56:56.067 --> 00:56:57.448
I start crying.

1393
00:56:59.001 --> 00:57:03.523
This is just the greatest
thing that's ever happened.

1394
00:57:03.627 --> 00:57:05.145
Zach's telling me how,

1395
00:57:05.249 --> 00:57:06.423
"You're gonna be
taken care of.

1396
00:57:06.526 --> 00:57:08.286
Gonna get
a portion of the sale."

1397
00:57:08.390 --> 00:57:11.773
And--and I'm just
through the moon.

1398
00:57:11.876 --> 00:57:14.292
You know, I run home and,
you know, tell my girlfriend.

1399
00:57:14.396 --> 00:57:16.536
And we're just so excited.

1400
00:57:18.331 --> 00:57:20.713
He's got me tuned up.

1401
00:57:20.816 --> 00:57:24.958
I am all in on 1inMM Capital.

1402
00:57:26.857 --> 00:57:28.721
- I've been looking through
Mallory's divorce filing

1403
00:57:28.824 --> 00:57:31.309
and I actually found
the answer

1404
00:57:31.413 --> 00:57:32.897
to a huge question
in this case.

1405
00:57:33.001 --> 00:57:35.624
So here it says, "There have
been countless text messages

1406
00:57:35.728 --> 00:57:37.212
"and emails
Zach would show me.

1407
00:57:37.315 --> 00:57:39.732
"Many times I would see him
receive notifications

1408
00:57:39.835 --> 00:57:41.768
"while he would be
sitting right next to me.

1409
00:57:41.872 --> 00:57:44.357
"Now I have learned
that Zach was actually sending

1410
00:57:44.461 --> 00:57:45.979
"the fabricated messages
to himself

1411
00:57:46.083 --> 00:57:48.154
"using an app to make it
appear as though

1412
00:57:48.257 --> 00:57:50.259
"he was receiving
communications

1413
00:57:50.363 --> 00:57:51.640
from third parties."

1414
00:57:51.744 --> 00:57:54.781
So check this out.

1415
00:57:54.885 --> 00:57:57.681
I put in my phone number.

1416
00:57:57.784 --> 00:57:59.890
I put in the message.

1417
00:57:59.993 --> 00:58:02.962
"Hey, Zach, ready
to sell me your library?"

1418
00:58:03.065 --> 00:58:08.864
And then I can select
today's date and the time.

1419
00:58:08.968 --> 00:58:10.279
[phone dings]

1420
00:58:10.383 --> 00:58:13.351
Oh, it's Ted Sarandos.

1421
00:58:13.455 --> 00:58:15.664
"Hey, Zach, ready
to sell me your library?"

1422
00:58:15.768 --> 00:58:17.321
Then all I have to do,
if I'm him,

1423
00:58:17.424 --> 00:58:20.117
is memorize my lines.

1424
00:58:20.220 --> 00:58:22.050
"That depends."

1425
00:58:22.153 --> 00:58:23.327
I send that back.

1426
00:58:23.430 --> 00:58:24.570
I already have
another one coming in.

1427
00:58:24.673 --> 00:58:25.881
"Depends on what?"

1428
00:58:25.985 --> 00:58:28.021
"The zeros," and et cetera.

1429
00:58:30.058 --> 00:58:34.096
- To locate real people
and create communications

1430
00:58:34.200 --> 00:58:37.237
with these people and then
sending them to investors

1431
00:58:37.341 --> 00:58:39.481
and saying, "Look,
I'm talking to these people,"

1432
00:58:39.585 --> 00:58:41.828
when really you're not.

1433
00:58:41.932 --> 00:58:44.106
Zach Horwitz's ability
to produce

1434
00:58:44.210 --> 00:58:47.213
documents that support that
was unique.

1435
00:58:47.316 --> 00:58:51.528
- The amount of work involved
in keeping track

1436
00:58:51.631 --> 00:58:55.048
of all of these different
deals is unbelievable.

1437
00:58:55.152 --> 00:58:56.360
[phone dings]

1438
00:58:56.463 --> 00:58:58.707
He's got hundreds of millions
of dollars on the table

1439
00:58:58.811 --> 00:59:00.675
that he's got to keep track of
and make sure people are

1440
00:59:00.778 --> 00:59:03.091
getting repaid
and bring in new money

1441
00:59:03.194 --> 00:59:05.783
to make sure it's possible
to repay them.

1442
00:59:05.887 --> 00:59:09.822
It's just really,
really elaborate.

1443
00:59:09.925 --> 00:59:12.238
You had to realize
that at some point,

1444
00:59:12.341 --> 00:59:15.724
the whole thing was gonna
collapse under its own weight.

1445
00:59:15.828 --> 00:59:17.105
- We'll see what happens.

1446
00:59:17.208 --> 00:59:18.382
You never know what
tomorrow holds, obviously.

1447
00:59:18.485 --> 00:59:20.729
[laughs]
- Yeah.

1448
00:59:20.833 --> 00:59:22.766
- Behind the scenes,
things were beginning

1449
00:59:22.869 --> 00:59:25.872
to fall apart for Zach Horwitz
and 1inMM Capital.

1450
00:59:27.978 --> 00:59:30.981
- When we first stopped
getting payments,

1451
00:59:31.084 --> 00:59:33.880
my wife's first reaction was,
"What's going on?

1452
00:59:33.984 --> 00:59:36.158
There's some kind
of scam happening."

1453
00:59:36.262 --> 00:59:37.643
She had, just prior to that,

1454
00:59:37.746 --> 00:59:39.852
wanted to pull
all the money out.

1455
00:59:39.955 --> 00:59:42.302
We were assured
everything was fine.

1456
00:59:42.406 --> 00:59:44.615
There's a little bit of panic
that sets in.

1457
00:59:44.719 --> 00:59:46.755
[tense music]

1458
00:59:46.859 --> 00:59:49.171
- So there are really
two parts to this fraud.

1459
00:59:49.275 --> 00:59:52.381
The first part was the actual
fraud itself, the agreements,

1460
00:59:52.485 --> 00:59:54.314
getting the investors
to invest.

1461
00:59:54.418 --> 00:59:57.559
Then at the end of 2019
when the payments stopped,

1462
00:59:57.663 --> 00:59:59.043
what could be determined was,

1463
00:59:59.147 --> 01:00:01.183
wasn't getting enough
new investor money

1464
01:00:01.287 --> 01:00:03.392
to repay existing investors.

1465
01:00:03.496 --> 01:00:07.500
And that's why the investment
collapsed at that point.

1466
01:00:07.604 --> 01:00:10.676
This is where part two
of the fraud starts.

1467
01:00:11.918 --> 01:00:15.128
- Zach just sending
text messages

1468
01:00:15.232 --> 01:00:19.477
and email communications
on the daily.

1469
01:00:19.581 --> 01:00:21.756
- We had screenshots
of text messages

1470
01:00:21.859 --> 01:00:22.929
that were
supposed to have been

1471
01:00:23.033 --> 01:00:24.690
between him
and HBO or Netflix,

1472
01:00:24.793 --> 01:00:27.693
like, why--why have things
suddenly changed?

1473
01:00:27.796 --> 01:00:30.074
And more importantly,
both these massive companies

1474
01:00:30.178 --> 01:00:31.558
had stopped paying,
coincidentally,

1475
01:00:31.662 --> 01:00:33.526
at the same time.

1476
01:00:33.630 --> 01:00:35.217
- I mean, we think
we're just in,

1477
01:00:35.321 --> 01:00:38.186
like, kind of this war
to receive payment.

1478
01:00:38.289 --> 01:00:40.015
- And then once
it starts falling apart,

1479
01:00:40.119 --> 01:00:44.848
he's now having to create
all this false documentation,

1480
01:00:44.951 --> 01:00:48.852
emails from HBO and Netflix.

1481
01:00:48.955 --> 01:00:50.750
- It just became more
and more convoluted for him.

1482
01:00:50.854 --> 01:00:52.165
And, of course,
each time he lies,

1483
01:00:52.269 --> 01:00:54.789
he's got to back that up
with more.

1484
01:00:54.892 --> 01:00:57.274
I would imagine
that was his full-time job.

1485
01:00:57.377 --> 01:01:01.899
When he wasn't filming,
he was forging documents.

1486
01:01:02.003 --> 01:01:04.246
- We call those
lulling statements.

1487
01:01:04.350 --> 01:01:07.491
And what they're doing is
buying themselves time,

1488
01:01:07.594 --> 01:01:09.148
either to bring in
new investors,

1489
01:01:09.251 --> 01:01:12.013
get influx of money
so they can pay the people,

1490
01:01:12.116 --> 01:01:14.774
or, if this is really the end,

1491
01:01:14.878 --> 01:01:16.431
this may be the time
that they're

1492
01:01:16.534 --> 01:01:22.609
going to exit the Ponzi scheme
and then make a run for it.

1493
01:01:23.231 --> 01:01:25.440
- You see it oftentimes
in these Ponzi schemes.

1494
01:01:25.543 --> 01:01:29.651
But the extent to which
he really went down that path

1495
01:01:29.755 --> 01:01:32.378
is like probably nothing
I've seen before.

1496
01:01:32.481 --> 01:01:35.761
And that, in turn, caused
more damage to investors

1497
01:01:35.864 --> 01:01:37.314
because now they believe that,

1498
01:01:37.417 --> 01:01:40.489
"Oh, he's actually working
to recover our money."

1499
01:01:40.593 --> 01:01:41.698
And these--these are
large companies.

1500
01:01:41.801 --> 01:01:43.147
These are
legitimate companies.

1501
01:01:43.251 --> 01:01:45.184
And they're gonna make good
on these payments.

1502
01:01:45.287 --> 01:01:48.049
So now these investors
are now digging themselves

1503
01:01:48.152 --> 01:01:50.534
into further financial loss.

1504
01:01:50.637 --> 01:01:52.916
- He came after myself
and my parents

1505
01:01:53.019 --> 01:01:56.298
for any last dime that
he could squeeze out of us.

1506
01:01:56.402 --> 01:01:58.128
And we didn't think,
in a million years,

1507
01:01:58.231 --> 01:02:01.303
that, you know, I'd never
see that money again,

1508
01:02:01.407 --> 01:02:03.961
that my parents would never
see their retirement again.

1509
01:02:05.894 --> 01:02:09.656
- Regarding Netflix,
once the audit's done,

1510
01:02:09.760 --> 01:02:12.176
hoping to get a date
when they're gonna pay.

1511
01:02:12.280 --> 01:02:16.422
That's kind of the latest
and greatest.

1512
01:02:16.525 --> 01:02:18.976
And if Netflix pays,
we get some breathing room

1513
01:02:19.080 --> 01:02:20.909
and get to survive.

1514
01:02:21.013 --> 01:02:23.912
- Scott Cohen was
playing tennis at a club.

1515
01:02:24.016 --> 01:02:27.744
And he ended up playing
with a man who was in charge

1516
01:02:27.847 --> 01:02:30.470
of Howard Schultz's finances.

1517
01:02:30.574 --> 01:02:32.990
Scott said to him, "Hey,
it's sort of a small world.

1518
01:02:33.094 --> 01:02:35.752
I work with Zach Horwitz."

1519
01:02:35.855 --> 01:02:38.168
And the guy looks
and says, "Who?"

1520
01:02:38.271 --> 01:02:40.032
He said,
"Well, you know, Zach.

1521
01:02:40.135 --> 01:02:42.379
"Sometimes Zach Avery.
But he's--he's an actor.

1522
01:02:42.482 --> 01:02:46.072
He does all the film
finance deals with Howard."

1523
01:02:46.176 --> 01:02:49.006
And he looked at him and said,
"I don't know who that is.

1524
01:02:49.110 --> 01:02:51.250
Never heard of him."

1525
01:02:51.353 --> 01:02:52.907
He didn't tell me that

1526
01:02:53.010 --> 01:02:55.806
until everything began
to fall apart.

1527
01:02:55.910 --> 01:02:57.394
He just kind of kept it
to himself.

1528
01:02:57.497 --> 01:03:01.191
I think he started to realize
that things weren't as rosy

1529
01:03:01.294 --> 01:03:03.434
as he was trying
to make them out to be.

1530
01:03:05.885 --> 01:03:08.025
- Clearly, you can see
everybody is motivated

1531
01:03:08.129 --> 01:03:09.855
and pushing,
other than the fucking people

1532
01:03:09.958 --> 01:03:11.132
that owe us the money,

1533
01:03:11.235 --> 01:03:13.720
which is just
a fucking disgrace.

1534
01:03:13.824 --> 01:03:15.550
- He hired counsels
to represent him

1535
01:03:15.653 --> 01:03:17.379
in fake litigation.

1536
01:03:17.483 --> 01:03:19.899
- Another reason why we all
felt this was legitimate--

1537
01:03:20.003 --> 01:03:21.763
his lawyers,
from a very big law firm,

1538
01:03:21.867 --> 01:03:24.007
reached out
and said things like,

1539
01:03:24.110 --> 01:03:27.389
they want nobody to try
and contact HBO or Netflix

1540
01:03:27.493 --> 01:03:30.289
because that would
jeopardize the relationship

1541
01:03:30.392 --> 01:03:32.981
that Zach had cultivated
over these number of years.

1542
01:03:33.085 --> 01:03:36.605
And so we were instructed
basically not to do so.

1543
01:03:36.709 --> 01:03:37.779
- So I go to Zach.

1544
01:03:37.883 --> 01:03:39.056
And I'm like,
"Zach, you know, hey,

1545
01:03:39.160 --> 01:03:40.471
"you know,
we got our house here

1546
01:03:40.575 --> 01:03:42.819
that we're gonna lose
if I don't get my money back."

1547
01:03:42.922 --> 01:03:43.889
He's like,
"Oh, man, I'm sorry.

1548
01:03:43.992 --> 01:03:45.269
"You know, it should be paid.

1549
01:03:45.373 --> 01:03:46.995
It's gonna be paid any time.
Here, look."

1550
01:03:47.099 --> 01:03:49.239
And then he'd forward emails
and forward communication

1551
01:03:49.342 --> 01:03:50.930
or show on his phone
that, you know,

1552
01:03:51.034 --> 01:03:52.069
things were gonna be paid.

1553
01:03:52.173 --> 01:03:54.278
So if there was any a time

1554
01:03:54.382 --> 01:03:58.973
where Zach could have
just maybe looked out

1555
01:03:59.076 --> 01:04:03.529
for myself,
my family, my fiancé,

1556
01:04:03.632 --> 01:04:05.462
that would have been it.

1557
01:04:05.565 --> 01:04:10.018
He had no financial gain
by letting us lose our home

1558
01:04:10.122 --> 01:04:12.124
and keep putting money
out to this home.

1559
01:04:12.227 --> 01:04:14.264
He could have just said,
you know, "Hey, Craig,

1560
01:04:14.367 --> 01:04:15.990
"there's gonna be
other houses.

1561
01:04:16.093 --> 01:04:17.543
"You know, I would just wait
for this HBO stuff

1562
01:04:17.646 --> 01:04:19.027
to get cleared up."

1563
01:04:19.131 --> 01:04:20.891
Then I would have been
begrudgingly like, "Oh, fine.

1564
01:04:20.995 --> 01:04:21.961
"You know,
we just lost our house,

1565
01:04:22.065 --> 01:04:23.273
but we'll get another one."

1566
01:04:23.376 --> 01:04:25.965
But that just shows me
that Zach

1567
01:04:26.069 --> 01:04:29.969
is just absolutely soulless.

1568
01:04:34.629 --> 01:04:36.355
Two weeks go by.

1569
01:04:36.458 --> 01:04:38.978
And we finally think
we're coming to agreement now

1570
01:04:39.082 --> 01:04:41.705
with WarnerMedia,
you know, the owner,

1571
01:04:41.808 --> 01:04:43.810
the parent company of HBO.

1572
01:04:43.914 --> 01:04:45.502
And then, of course,
COVID hits.

1573
01:04:45.605 --> 01:04:47.780
- The entertainment industry
in California has been

1574
01:04:47.884 --> 01:04:50.024
decimated by COVID-19.

1575
01:04:50.127 --> 01:04:51.508
- Netflix shutting down
production

1576
01:04:51.611 --> 01:04:54.994
on all of its scripted
television and film projects.

1577
01:04:55.098 --> 01:04:56.064
- You know, now we're into,
you know,

1578
01:04:56.168 --> 01:04:57.410
May and June and July.

1579
01:04:57.514 --> 01:04:59.999
And what a perfect
built-in excuse

1580
01:05:00.103 --> 01:05:02.381
for Zach to play off of.

1581
01:05:02.484 --> 01:05:05.211
- The individuals perpetrating
the frauds often use

1582
01:05:05.315 --> 01:05:09.146
current events as reasons
for why the investment

1583
01:05:09.250 --> 01:05:10.665
isn't working anymore.

1584
01:05:10.768 --> 01:05:13.323
- Everything was going fine,
except that the attorney

1585
01:05:13.426 --> 01:05:16.050
for Netflix just got COVID, right?

1586
01:05:16.153 --> 01:05:18.362
And then I said,
"I mean, this is strange

1587
01:05:18.466 --> 01:05:21.400
because Netflix has
more than one attorney."

1588
01:05:21.503 --> 01:05:24.403
But, of course, each time
any investor brought up

1589
01:05:24.506 --> 01:05:29.166
any concerns, they were met
with explanations and answers

1590
01:05:29.270 --> 01:05:30.961
that were meant to satiate us.

1591
01:05:31.065 --> 01:05:33.584
And for a period of time,
it did.

1592
01:05:33.688 --> 01:05:36.933
- And it was just
a nightmarish year of COVID,

1593
01:05:37.036 --> 01:05:38.831
first and foremost, and then,

1594
01:05:38.935 --> 01:05:40.729
you know, dealing
with this disaster

1595
01:05:40.833 --> 01:05:41.938
of not having any funds.

1596
01:05:42.041 --> 01:05:43.422
You know, he cleaned us out.

1597
01:05:43.525 --> 01:05:47.115
He cleaned myself, my family,
and closest friends out.

1598
01:05:47.219 --> 01:05:49.014
- If you look back
at some of the texts

1599
01:05:49.117 --> 01:05:51.085
that we're getting
during the time

1600
01:05:51.188 --> 01:05:54.847
that we had ceased being paid,

1601
01:05:54.951 --> 01:05:57.298
there was just
a sort of a "bro" element.

1602
01:05:57.401 --> 01:05:59.369
I don't know if there's
a better way to put it.

1603
01:05:59.472 --> 01:06:03.511
Here we have a member
of JJMT saying,

1604
01:06:03.614 --> 01:06:05.582
"This year fucking sucked.

1605
01:06:05.685 --> 01:06:08.688
"But hoping for a quick
blastoff of positivity

1606
01:06:08.792 --> 01:06:10.414
starting next week, boys."

1607
01:06:10.518 --> 01:06:15.799
Then Zach responds, "100,
double exclamation point.

1608
01:06:15.902 --> 01:06:18.457
"Fuck 2020 in all ways.

1609
01:06:18.560 --> 01:06:20.804
"2021, baby.

1610
01:06:20.907 --> 01:06:25.015
LFG." Let's fucking go.

1611
01:06:28.674 --> 01:06:32.436
- It takes a specific type
of person, I think,

1612
01:06:32.540 --> 01:06:34.231
to do this.

1613
01:06:34.335 --> 01:06:37.579
I don't think most people
can do it,

1614
01:06:37.683 --> 01:06:40.410
at least not on the level
that we're talking about,

1615
01:06:40.513 --> 01:06:42.895
where you're talking about
tens of millions of dollars

1616
01:06:42.999 --> 01:06:45.139
and you're going
to destroy these people.

1617
01:06:45.242 --> 01:06:48.038
They're going to lose
their, you know, life savings.

1618
01:06:48.142 --> 01:06:49.453
They're going to lose
their homes.

1619
01:06:49.557 --> 01:06:52.491
That's a particular level
of human callousness

1620
01:06:52.594 --> 01:06:55.597
that most people
probably don't have.

1621
01:06:55.701 --> 01:06:58.221
- A lot of actors have
a deep insecurity.

1622
01:06:58.324 --> 01:07:00.878
And it's one of the reasons
why they want to be on film,

1623
01:07:00.982 --> 01:07:02.708
why they want to be
someone different,

1624
01:07:02.811 --> 01:07:05.607
why they want to portray
these other characters.

1625
01:07:05.711 --> 01:07:08.058
And I think that's part
of what drove him to that.

1626
01:07:08.162 --> 01:07:09.404
But I think
most importantly for him

1627
01:07:09.508 --> 01:07:11.268
was just this idea of fame.

1628
01:07:11.372 --> 01:07:14.478
And he was willing to do
whatever it took to get there.

1629
01:07:18.344 --> 01:07:21.623
- You're gonna need something
when you get there, no?

1630
01:07:21.727 --> 01:07:23.694
- Thank you.

1631
01:07:23.798 --> 01:07:28.389
- Very few Ponzi schemers
actually have a exit strategy.

1632
01:07:28.492 --> 01:07:32.600
They sometimes flee and get
out of the jurisdiction.

1633
01:07:32.703 --> 01:07:35.844
But it's hard
to really disappear now.

1634
01:07:37.743 --> 01:07:40.090
- Can you show us how it all
kind of breaks down?

1635
01:07:40.194 --> 01:07:42.230
- You've got several
of these investors.

1636
01:07:42.334 --> 01:07:44.646
They're paying in.
Okay?

1637
01:07:44.750 --> 01:07:46.372
These people are
earning their returns.

1638
01:07:46.476 --> 01:07:48.374
And somebody
in one of these tiers,

1639
01:07:48.478 --> 01:07:52.033
let's say it's this person,
draws out.

1640
01:07:52.137 --> 01:07:54.380
And maybe he recruited.

1641
01:07:54.484 --> 01:07:56.279
Well, now, it's not enough
to support it.

1642
01:07:56.382 --> 01:07:58.729
And the whole thing collapses.

1643
01:07:58.833 --> 01:08:01.215
So nothing's coming in.

1644
01:08:01.318 --> 01:08:04.114
And at the same time,
the people

1645
01:08:04.218 --> 01:08:07.083
that got screwed down here,
at the bottom,

1646
01:08:07.186 --> 01:08:10.120
are just going to the police.

1647
01:08:10.224 --> 01:08:12.916
- I don't know that there's
a lot more time left

1648
01:08:13.019 --> 01:08:16.092
in the patience box
with 1inMM.

1649
01:08:16.195 --> 01:08:19.198
This is a real
fucking disaster.

1650
01:08:19.302 --> 01:08:22.615
- I think that Scott,
at that time,

1651
01:08:22.719 --> 01:08:25.308
actually reached out
to the FBI.

1652
01:08:26.930 --> 01:08:30.278
And that's when it kind of
all came crumbling down.

1653
01:08:32.315 --> 01:08:33.971
- The case was initiated.

1654
01:08:34.075 --> 01:08:36.560
A victim attorney
contacted the FBI office,

1655
01:08:36.664 --> 01:08:38.459
that they believe that
Zach Horwitz had committed

1656
01:08:38.562 --> 01:08:41.600
a fraud against their clients.

1657
01:08:41.703 --> 01:08:44.706
- One of the first things
we do in these fraud cases

1658
01:08:44.810 --> 01:08:46.363
is the financial analysis.

1659
01:08:46.467 --> 01:08:49.366
The FBI has created an entire
cadre of forensic accountants

1660
01:08:49.470 --> 01:08:51.437
in addition
to the special agents.

1661
01:08:51.541 --> 01:08:53.163
And so they get
the bank accounts

1662
01:08:53.267 --> 01:08:55.372
and then trace
where all the money went.

1663
01:08:55.476 --> 01:08:56.649
- The FBI was on the case.

1664
01:08:56.753 --> 01:08:58.686
The SEC was on the case.

1665
01:08:58.789 --> 01:09:00.101
- We know what's going on.

1666
01:09:00.205 --> 01:09:01.689
And then we interview
the victims

1667
01:09:01.792 --> 01:09:04.554
to see what they thought
they were investing in.

1668
01:09:04.657 --> 01:09:06.970
- Oftentimes,
these investigations can last

1669
01:09:07.073 --> 01:09:10.491
6 months, 18 months,
even years.

1670
01:09:10.594 --> 01:09:12.493
One of the things that
enabled this investigation,

1671
01:09:12.596 --> 01:09:15.254
in particular, to move quickly
was the documentation

1672
01:09:15.358 --> 01:09:17.291
that the victim investors had.

1673
01:09:17.394 --> 01:09:19.396
- One of the key elements
of this is,

1674
01:09:19.500 --> 01:09:22.503
was there a scheme
to defraud the victims?

1675
01:09:22.606 --> 01:09:24.884
The way we prove the scheme
is showing what they were told

1676
01:09:24.988 --> 01:09:26.300
and what actually happened.

1677
01:09:26.403 --> 01:09:28.647
And that's how
we identify the fraud.

1678
01:09:30.200 --> 01:09:31.443
- There was a lot of pressure

1679
01:09:31.546 --> 01:09:33.030
that Zach Horwitz
is gonna flee.

1680
01:09:33.134 --> 01:09:34.963
That's often a concern
of investors,

1681
01:09:35.067 --> 01:09:36.758
that this thing's
falling apart now,

1682
01:09:36.862 --> 01:09:39.244
and he's gonna take
all the money and run.

1683
01:09:39.347 --> 01:09:42.764
[suspenseful music]

1684
01:09:42.868 --> 01:09:44.663
[indistinct radio chatter]

1685
01:09:44.766 --> 01:09:47.424
[sirens wailing]

1686
01:09:47.528 --> 01:09:49.771
- The morning of the arrest,
out of nowhere,

1687
01:09:49.875 --> 01:09:53.223
FBI agents are
pounding on the door,

1688
01:09:53.327 --> 01:09:56.295
and there are agents
all swarming into the yard,

1689
01:09:56.399 --> 01:09:58.159
demanding that they
come downstairs.

1690
01:09:58.263 --> 01:09:59.436
It's just complete panic.

1691
01:09:59.540 --> 01:10:02.198
And suffice it to say,

1692
01:10:02.301 --> 01:10:04.269
Mallory was
pretty freaked out.

1693
01:10:04.372 --> 01:10:07.030
- When Zach's wife
came to the door,

1694
01:10:07.133 --> 01:10:08.825
she didn't know
why we were there.

1695
01:10:08.928 --> 01:10:12.069
And then the next person
to come down was Zach Horwitz.

1696
01:10:12.173 --> 01:10:14.106
I don't know if he had
any inkling

1697
01:10:14.210 --> 01:10:16.004
that the FBI was
investigating him.

1698
01:10:16.108 --> 01:10:18.800
I'm guessing it's probably
at the time of the arrest.

1699
01:10:18.904 --> 01:10:20.181
Well, that reminds me
of something else

1700
01:10:20.285 --> 01:10:21.389
I'll tell you about.

1701
01:10:21.493 --> 01:10:23.702
One of the unusual things
about him was--

1702
01:10:23.805 --> 01:10:26.360
is oftentimes,
when we arrest these people,

1703
01:10:26.463 --> 01:10:28.983
they'll often say, like,
"Oh, why are you here?

1704
01:10:29.086 --> 01:10:30.260
"This is all
a misunderstanding.

1705
01:10:30.364 --> 01:10:31.261
It's a real business."

1706
01:10:31.365 --> 01:10:32.918
[distant sirens wailing]

1707
01:10:33.021 --> 01:10:34.160
Zach didn't say a word.

1708
01:10:34.264 --> 01:10:35.714
He was very calm.

1709
01:10:35.817 --> 01:10:37.060
He wasn't in shock.

1710
01:10:37.163 --> 01:10:38.613
So that was unusual.

1711
01:10:38.717 --> 01:10:40.132
I mean,
when you arrest somebody,

1712
01:10:40.236 --> 01:10:42.203
usually they want to know what
they're being arrested for.

1713
01:10:42.307 --> 01:10:45.517
But he never asked
that question.

1714
01:10:45.620 --> 01:10:48.002
After Zach was arrested,
we Mirandized him.

1715
01:10:48.105 --> 01:10:50.694
Myself and another agent
attempted to interview Zach.

1716
01:10:50.798 --> 01:10:52.420
But he declined.

1717
01:10:52.524 --> 01:10:55.665
He never made any statements
to law enforcement.

1718
01:10:58.771 --> 01:11:01.015
- When I first saw
the "LA Times" article,

1719
01:11:01.118 --> 01:11:02.396
I was blown away.

1720
01:11:02.499 --> 01:11:04.363
I was just like, this--
this can't be true.

1721
01:11:04.467 --> 01:11:05.951
- I didn't believe it.

1722
01:11:06.054 --> 01:11:08.125
You know, I was almost mad.

1723
01:11:08.229 --> 01:11:09.679
Like, I didn't even know
what to think

1724
01:11:09.782 --> 01:11:13.096
because there was just no way
in my being--

1725
01:11:13.199 --> 01:11:14.511
how is this even real?

1726
01:11:14.615 --> 01:11:16.410
That was my first reaction

1727
01:11:16.513 --> 01:11:18.239
until I just kind of sat there

1728
01:11:18.343 --> 01:11:20.276
and, you know,
let it all digest.

1729
01:11:20.379 --> 01:11:22.899
And then that's when
it sunk in

1730
01:11:23.002 --> 01:11:26.834
that one of my best friends
has been conning myself,

1731
01:11:26.937 --> 01:11:29.733
my family,
and some of my closest friends

1732
01:11:29.837 --> 01:11:32.184
for the last ten years,
and that he stole

1733
01:11:32.288 --> 01:11:33.841
everything from us,

1734
01:11:33.944 --> 01:11:36.568
and that I might not ever
see it again.

1735
01:11:36.671 --> 01:11:38.328
- The day
they raided his house

1736
01:11:38.432 --> 01:11:41.227
was a good day, you know?

1737
01:11:41.331 --> 01:11:43.091
You finally see somebody

1738
01:11:43.195 --> 01:11:44.817
getting their comeuppance, right?

1739
01:11:44.921 --> 01:11:47.751
And more importantly for us,
I guess it began the process

1740
01:11:47.855 --> 01:11:49.788
to be able to hold him
accountable and--

1741
01:11:49.891 --> 01:11:54.724
and perhaps in a very
unlikely scenario, that--

1742
01:11:54.827 --> 01:11:56.967
that some of the money
could be recouped.

1743
01:12:00.695 --> 01:12:03.008
- It seems
that a lot of the people

1744
01:12:03.111 --> 01:12:04.561
who invested in this

1745
01:12:04.665 --> 01:12:07.771
and who lost money
were older people

1746
01:12:07.875 --> 01:12:10.947
or people in transitions,
people going through divorces,

1747
01:12:11.050 --> 01:12:13.536
people who lost members
of their family recently,

1748
01:12:13.639 --> 01:12:16.642
people who had sick members
of their families.

1749
01:12:16.746 --> 01:12:18.748
And so a lot of these people,
I think,

1750
01:12:18.851 --> 01:12:20.819
were vulnerable
in that respect.

1751
01:12:20.922 --> 01:12:24.788
And I think he was able
to really capitalize on that.

1752
01:12:27.239 --> 01:12:29.586
- When these cases
come to trial,

1753
01:12:29.690 --> 01:12:32.727
what kind of jail time can you
expect as a Ponzi schemer?

1754
01:12:32.831 --> 01:12:36.731
- I see that most of the cases
end up at two to seven years.

1755
01:12:36.835 --> 01:12:39.355
But it's
a complicated process.

1756
01:12:39.458 --> 01:12:40.908
Depending on the number
of victims,

1757
01:12:41.011 --> 01:12:42.116
the number goes up.

1758
01:12:42.219 --> 01:12:45.361
Depending on the loss amount,
the number goes up.

1759
01:12:45.464 --> 01:12:48.294
Your role in the crime,
the number goes up.

1760
01:12:48.398 --> 01:12:52.264
Aggravating circumstances--
did you target elderly people?

1761
01:12:52.368 --> 01:12:54.784
Did you target groups
that would be

1762
01:12:54.887 --> 01:12:56.510
particularly injured
by your crime?

1763
01:12:56.613 --> 01:12:58.270
That causes the number
to go up.

1764
01:12:58.374 --> 01:13:00.617
There's a cap,
like, at 20 years.

1765
01:13:00.721 --> 01:13:03.206
But the judge can deviate

1766
01:13:03.309 --> 01:13:04.932
from those
sentencing guidelines.

1767
01:13:08.245 --> 01:13:09.385
- I just went
into the courthouse

1768
01:13:09.488 --> 01:13:10.903
and asked about the camera.

1769
01:13:11.007 --> 01:13:13.458
And they said no cameras in
federal court, which is fine.

1770
01:13:13.561 --> 01:13:14.804
Kind of what I expected.

1771
01:13:17.841 --> 01:13:18.980
Check, check.

1772
01:13:19.084 --> 01:13:20.568
Sound good?

1773
01:13:20.672 --> 01:13:21.638
- Yeah, just hide the wire
a little bit.

1774
01:13:21.742 --> 01:13:23.295
- Oh.

1775
01:13:23.399 --> 01:13:24.710
Better?
- Yeah.

1776
01:13:24.814 --> 01:13:25.849
- Okay.

1777
01:13:25.953 --> 01:13:29.681
So here he is,
coming in, right here.

1778
01:13:36.619 --> 01:13:38.517
- I have sat through a lot
of statements to the court

1779
01:13:38.621 --> 01:13:41.002
by people who have been
convicted of crimes.

1780
01:13:41.106 --> 01:13:45.282
And his lacked specificity
in a way that struck me.

1781
01:13:45.386 --> 01:13:46.732
When I was writing my story

1782
01:13:46.836 --> 01:13:48.458
and I was trying to find
quotes from it,

1783
01:13:48.562 --> 01:13:49.977
I actually just
threw up my hands

1784
01:13:50.080 --> 01:13:51.703
because he really didn't say
that much.

1785
01:13:51.806 --> 01:13:54.671
It was--it sounded
very generic.

1786
01:13:54.775 --> 01:13:58.503
- We found out that Zach had
sent a letter to the judge.

1787
01:13:58.606 --> 01:14:01.575
And in it,
he had asked the judge

1788
01:14:01.678 --> 01:14:04.405
to be lenient upon him
because, in fact,

1789
01:14:04.509 --> 01:14:06.407
it was the fault
of the victims

1790
01:14:06.511 --> 01:14:10.031
for not seeing the red flags.

1791
01:14:10.135 --> 01:14:12.551
And it went over about as well
as you can imagine.

1792
01:14:12.655 --> 01:14:15.105
The judge was not too pleased.

1793
01:14:15.209 --> 01:14:17.142
- I fucked up.

1794
01:14:17.245 --> 01:14:18.833
I'm a piece of shit.

1795
01:14:18.937 --> 01:14:21.733
- Actor Zachary Joseph Horwitz
is agreeing to plead guilty

1796
01:14:21.836 --> 01:14:25.909
to a $650 million
Ponzi scheme.

1797
01:14:26.013 --> 01:14:28.153
- When Zach agreed
to plead guilty in October,

1798
01:14:28.256 --> 01:14:29.706
he appeared in court.

1799
01:14:29.810 --> 01:14:34.021
And he pled guilty to a single
count of securities fraud.

1800
01:14:34.124 --> 01:14:36.817
And with that agreement,
other charges,

1801
01:14:36.920 --> 01:14:39.889
with decades more in prison,
were dropped.

1802
01:14:39.992 --> 01:14:42.339
- When Zach Horwitz
was sentenced,

1803
01:14:42.443 --> 01:14:44.203
you know, he was sentenced
to 20 years

1804
01:14:44.307 --> 01:14:47.310
and ordered to pay
$230 million in restitution.

1805
01:14:47.413 --> 01:14:50.865
A 20-year sentence,
you know, was--

1806
01:14:50.969 --> 01:14:52.764
I was a little surprised
by it.

1807
01:14:52.867 --> 01:14:55.076
I think in this case,
I think it's just

1808
01:14:55.180 --> 01:14:56.664
the sheer numbers involved.

1809
01:14:56.768 --> 01:15:00.565
- It was really striking
to hear the judge go over

1810
01:15:00.668 --> 01:15:04.051
all of the money that was
spent during this scheme.

1811
01:15:04.154 --> 01:15:06.812
The $7 million
on the American Express card.

1812
01:15:06.916 --> 01:15:11.403
I think it was $700,000
for interior design.

1813
01:15:11.507 --> 01:15:15.062
The Mercedes Benz
of Beverly Hills.

1814
01:15:15.165 --> 01:15:17.720
Where is that money now?

1815
01:15:17.823 --> 01:15:19.549
- I think I know
the answer to this,

1816
01:15:19.653 --> 01:15:20.792
and it's a bummer.

1817
01:15:20.895 --> 01:15:21.896
But what about the victims?

1818
01:15:22.000 --> 01:15:23.449
Do they ever get
their money back?

1819
01:15:23.553 --> 01:15:25.659
- This is one of the toughest
things I have to tell people,

1820
01:15:25.762 --> 01:15:27.626
because they all believe
that the money is

1821
01:15:27.730 --> 01:15:29.455
squirreled away somewhere.

1822
01:15:29.559 --> 01:15:32.666
And it's not.

1823
01:15:32.769 --> 01:15:34.219
- All the money
has been spent.

1824
01:15:34.322 --> 01:15:36.497
And that's why the actual
investment collapses.

1825
01:15:36.601 --> 01:15:38.637
They spend the money,
dinners, travel,

1826
01:15:38.741 --> 01:15:40.570
like, things
that you can't recover.

1827
01:15:40.674 --> 01:15:43.090
- They frequently tell me
that they know,

1828
01:15:43.193 --> 01:15:44.712
at some point,
they're gonna get caught.

1829
01:15:44.816 --> 01:15:46.611
If you know
that the end is coming,

1830
01:15:46.714 --> 01:15:47.991
just spend the money.

1831
01:15:48.095 --> 01:15:51.788
- He had his house
and the contents of the house.

1832
01:15:51.892 --> 01:15:53.997
And that--really,
that was about it.

1833
01:15:54.101 --> 01:15:55.792
You know, there was
approximately a little over

1834
01:15:55.896 --> 01:15:59.727
$2 million that was recovered
from the sale of the house.

1835
01:15:59.831 --> 01:16:01.418
- I don't see myself

1836
01:16:01.522 --> 01:16:03.559
as the victim who was
impacted the most

1837
01:16:03.662 --> 01:16:04.732
because some of the stories
I've heard

1838
01:16:04.836 --> 01:16:06.700
have been far more tragic
than mine.

1839
01:16:06.803 --> 01:16:09.910
My wife and I lost
$1.8 million in total.

1840
01:16:10.013 --> 01:16:12.291
It took us a long time
to save that kind of money.

1841
01:16:12.395 --> 01:16:14.155
It's--again, it's relative.

1842
01:16:14.259 --> 01:16:18.228
To some person, 120,000 would
be the equivalent of that.

1843
01:16:18.332 --> 01:16:20.092
And to some, it's 120 million.

1844
01:16:20.196 --> 01:16:23.268
For us, that 1.8

1845
01:16:23.371 --> 01:16:25.166
was everything that we had
managed to accrue

1846
01:16:25.270 --> 01:16:27.306
over a long period of time.

1847
01:16:27.410 --> 01:16:29.895
And so that was just wiped

1848
01:16:29.999 --> 01:16:31.863
just so somebody could
feel good about himself

1849
01:16:31.966 --> 01:16:33.485
and cast himself
in a few movies

1850
01:16:33.589 --> 01:16:35.867
and party in Vegas
a little bit.

1851
01:16:35.970 --> 01:16:38.628
And that's--that's tough
to deal with.

1852
01:16:38.732 --> 01:16:41.907
- Speeding.

1853
01:16:42.011 --> 01:16:44.841
- It's bad regardless,
strangers or people you know.

1854
01:16:44.945 --> 01:16:49.294
But to get family
and friends involved, it's--

1855
01:16:49.397 --> 01:16:50.882
that's a whole other level

1856
01:16:50.985 --> 01:16:52.642
of just blocking out
right and wrong.

1857
01:16:52.746 --> 01:16:56.439
- You just want to believe
the best of a person

1858
01:16:56.542 --> 01:16:59.097
and kind of block out
everything else.

1859
01:16:59.200 --> 01:17:02.928
- I've personally known
a lot of Zach Averys.

1860
01:17:03.032 --> 01:17:05.448
I just never thought
that any one of them

1861
01:17:05.551 --> 01:17:09.486
would be smart enough
or cold enough

1862
01:17:09.590 --> 01:17:11.074
to pull
something like this off.

1863
01:17:11.178 --> 01:17:13.525
- It's so fascinating to me
that something like this

1864
01:17:13.629 --> 01:17:18.495
could happen in our industry,
like, right in my backyard.

1865
01:17:18.599 --> 01:17:23.846
- He did a lot of things
that we,

1866
01:17:23.949 --> 01:17:26.296
on different levels, you know,
would consider terrible

1867
01:17:26.400 --> 01:17:29.610
or immoral or dishonest.

1868
01:17:29.714 --> 01:17:31.232
- At the end of the day,
it's sort of just

1869
01:17:31.336 --> 01:17:34.995
an unforgivable thing
to lie that way,

1870
01:17:35.098 --> 01:17:37.687
to scheme that many people,
and take that much money

1871
01:17:37.791 --> 01:17:38.895
all for yourself.

1872
01:17:38.999 --> 01:17:43.210
- The greed
took him over completely.

1873
01:17:43.313 --> 01:17:46.592
- Really made me consider
my past actions.

1874
01:17:46.696 --> 01:17:49.975
I think I'm making
really good progress now.

1875
01:17:50.079 --> 01:17:53.841
- When I went to court
to watch Zach be sentenced,

1876
01:17:53.945 --> 01:17:57.258
you know, there was
a realization that all of us,

1877
01:17:57.362 --> 01:17:59.053
all of the victims,
had been sentenced.

1878
01:17:59.157 --> 01:18:02.125
And for some,
it was a life sentence, right?

1879
01:18:02.229 --> 01:18:06.820
We are now forced to pick up
the pieces of the lives

1880
01:18:06.923 --> 01:18:08.787
that this guy has shattered.

1881
01:18:08.891 --> 01:18:11.479
But there are those that
I know will never be able to,

1882
01:18:11.583 --> 01:18:13.171
not just because
the amount of money,

1883
01:18:13.274 --> 01:18:15.276
but just because of the time
it took to get there

1884
01:18:15.380 --> 01:18:18.038
and how much time
they may have left.

1885
01:18:18.141 --> 01:18:21.351
- My mom's in the other room,
just found out that she,

1886
01:18:21.455 --> 01:18:24.423
you know, has terminal cancer.

1887
01:18:24.527 --> 01:18:27.012
You know, my parents'
retirement's in this fund.

1888
01:18:27.116 --> 01:18:30.809
How do you go in the hall
and go look at your dad

1889
01:18:30.913 --> 01:18:35.262
and tell him
that their money's gone,

1890
01:18:35.365 --> 01:18:37.989
this was all a lie?

1891
01:18:38.092 --> 01:18:39.887
Like, how do you have
that conversation?

1892
01:18:39.991 --> 01:18:42.200
You know, imagine having
that conversation.

1893
01:18:42.303 --> 01:18:44.443
It was one of the hardest
conversations I've ever had.

1894
01:18:44.547 --> 01:18:46.618
You know, he was just--
he loved Zach as well.

1895
01:18:46.722 --> 01:18:50.104
And just the hurt,
you know, in his eyes

1896
01:18:50.208 --> 01:18:54.281
and my mother's eyes,
and I just--

1897
01:18:54.384 --> 01:18:57.525
you know, it just wasn't--

1898
01:18:57.629 --> 01:18:58.975
I just couldn't believe it,

1899
01:18:59.079 --> 01:19:00.597
that everything I thought
was my life

1900
01:19:00.701 --> 01:19:03.083
and what was real just wasn't.

1901
01:19:03.186 --> 01:19:06.120
- How could somebody do that,
just lie to all the people

1902
01:19:06.224 --> 01:19:10.711
that knew him, trusted him,
and, like, just full-on lie?

1903
01:19:10.815 --> 01:19:12.748
How am I gonna face my kids?
They're upstairs.

1904
01:19:12.851 --> 01:19:14.577
Like, how am I gonna
face my wife?

1905
01:19:14.680 --> 01:19:17.614
This is gonna be a stain,
like, forever in our marriage.

1906
01:19:17.718 --> 01:19:19.755
Like, how do we--
how do we get past that?

1907
01:19:19.858 --> 01:19:22.619
You know, and what happened
in your past

1908
01:19:22.723 --> 01:19:24.173
that you would
make this happen,

1909
01:19:24.276 --> 01:19:26.796
so I can avoid that
with my kids

1910
01:19:26.900 --> 01:19:30.179
and make sure
they don't turn out like you?

1911
01:19:30.282 --> 01:19:32.802
- At a sentencing, the defense
is given an opportunity

1912
01:19:32.906 --> 01:19:34.217
to make a statement.

1913
01:19:34.321 --> 01:19:36.219
And during the whole period
of his sentencing,

1914
01:19:36.323 --> 01:19:39.153
he was sitting at a table
with his counsels

1915
01:19:39.257 --> 01:19:41.949
and, you know, was very
just expressionless.

1916
01:19:42.053 --> 01:19:43.813
And then when he got up
to make his statement,

1917
01:19:43.917 --> 01:19:46.540
he became animated
and was very remorseful

1918
01:19:46.643 --> 01:19:48.853
about all the damage
he had caused

1919
01:19:48.956 --> 01:19:50.855
and the irreparable
financial loss

1920
01:19:50.958 --> 01:19:53.098
he had created
to all the victims

1921
01:19:53.202 --> 01:19:55.825
and all the people that,
you know, he had betrayed.

1922
01:19:55.929 --> 01:19:57.275
And then after he had
made his statement,

1923
01:19:57.378 --> 01:20:00.036
he--he sat back down
and went back

1924
01:20:00.140 --> 01:20:02.383
to, you know,
that same poker face.

1925
01:20:02.487 --> 01:20:04.696
So maybe--maybe
at that point in time,

1926
01:20:04.800 --> 01:20:08.113
we were seeing a little bit of
Zach Avery in the courtroom.

1927
01:20:08.217 --> 01:20:10.944
- After the court case,
I went to the bathroom.

1928
01:20:11.047 --> 01:20:16.328
And as I was walking out,
the door opened.

1929
01:20:16.432 --> 01:20:20.505
And in walks Zach Avery,
Zach Horwitz.

1930
01:20:20.608 --> 01:20:23.853
And it's
such a strange feeling

1931
01:20:23.957 --> 01:20:26.235
because there's this guy
that's ruined my life.

1932
01:20:26.338 --> 01:20:30.066
And he--he walked past me
and he looked up,

1933
01:20:30.170 --> 01:20:32.689
and we kind of met eyes.

1934
01:20:32.793 --> 01:20:36.935
And he's like,
"Hey, man, I'm, like--

1935
01:20:37.039 --> 01:20:39.904
"I'm so, so sorry.

1936
01:20:40.007 --> 01:20:42.285
I'm so sorry."

1937
01:20:42.389 --> 01:20:45.564
And it's just--
well, I should hope so.

1938
01:20:45.668 --> 01:20:47.739
I mean, I'm sure you're more
sorry you got caught

1939
01:20:47.843 --> 01:20:50.155
and you're spending
20 years in prison.

1940
01:20:50.259 --> 01:20:56.299
But I said, "Look, dude,
what was your endgame?"

1941
01:20:56.403 --> 01:21:00.131
And he said,
"I didn't have one."

1942
01:21:00.234 --> 01:21:03.272
It's almost worse to hear
than he just messed up, right?

1943
01:21:03.375 --> 01:21:05.343
It's like,
he never had a plan.

1944
01:21:05.446 --> 01:21:08.484
He just was taking
people's money and spending.

1945
01:21:08.587 --> 01:21:11.452
- That he perpetrated this
crime against people he knew,

1946
01:21:11.556 --> 01:21:14.041
people he didn't know,
and then his own family,

1947
01:21:14.145 --> 01:21:15.871
who also is dealing
with the wreckage

1948
01:21:15.974 --> 01:21:18.183
because he's got
two young sons

1949
01:21:18.287 --> 01:21:20.151
and he's in prison
for the next 20 years,

1950
01:21:20.254 --> 01:21:23.533
so by the time he gets out,
they'll be adults.

1951
01:21:23.637 --> 01:21:27.330
- He's in jail now and is
leaving his two kids behind.

1952
01:21:27.434 --> 01:21:31.576
That is his legacy
that he's in prison, you know?

1953
01:21:31.679 --> 01:21:34.510
And he is a criminal.

1954
01:21:34.613 --> 01:21:38.100
And, you know, I wish
he'd stay behind bars

1955
01:21:38.203 --> 01:21:39.964
the rest of his life.

1956
01:21:44.451 --> 01:21:48.248
- Okay, we're speeding.
- Speeding.

1957
01:21:48.351 --> 01:21:50.975
- Okay.

1958
01:21:51.078 --> 01:21:53.529
- 59. Take one. Mark.

1959
01:21:55.393 --> 01:21:59.466
- I guess if I'm being honest,
just the type of egos

1960
01:21:59.569 --> 01:22:01.813
that are involved
in running schemes like this--

1961
01:22:01.917 --> 01:22:04.471
what makes that guy tick,
you know?

1962
01:22:04.574 --> 01:22:08.854
- I would love to actually
meet him, honestly.

1963
01:22:08.958 --> 01:22:10.822
Like, I'm so curious.

1964
01:22:10.926 --> 01:22:12.065
- He's crazy.

1965
01:22:12.168 --> 01:22:13.894
I mean, what is wrong
with this guy?

1966
01:22:13.998 --> 01:22:15.344
How can you be so smart

1967
01:22:15.447 --> 01:22:17.656
and so stupid
at the same time?

1968
01:22:17.760 --> 01:22:19.348
- I mean,
I'd watch this movie.

1969
01:22:19.451 --> 01:22:20.763
[laughs]

1970
01:22:20.866 --> 01:22:21.902
- I always try
to do things the way

1971
01:22:22.006 --> 01:22:23.110
you're supposed to do them.

1972
01:22:23.214 --> 01:22:26.872
And whenever I see
somebody getting away

1973
01:22:26.976 --> 01:22:30.566
with just breaking the rules,

1974
01:22:30.669 --> 01:22:32.464
it makes me really angry.

1975
01:22:32.568 --> 01:22:34.156
- I'm very interested
in exploring

1976
01:22:34.259 --> 01:22:37.745
how someone's capable
of carrying that much guilt

1977
01:22:37.849 --> 01:22:39.402
on their own shoulders.

1978
01:22:42.681 --> 01:22:45.408
- So you're gonna be looking
straight down the barrel.

1979
01:22:45.512 --> 01:22:47.652
- When people read
about financial crime,

1980
01:22:47.755 --> 01:22:50.689
they are engaging with it
from an arm's length

1981
01:22:50.793 --> 01:22:54.555
because nobody wants
to identify with the criminal

1982
01:22:54.659 --> 01:22:57.317
because they don't think
they can lie at that level

1983
01:22:57.420 --> 01:23:01.010
or be cruel.

1984
01:23:01.114 --> 01:23:02.908
And we really don't have
that much sympathy

1985
01:23:03.012 --> 01:23:05.290
for the victims either because
nobody thinks of themselves

1986
01:23:05.394 --> 01:23:08.811
as being reckless or naive
or stupid enough

1987
01:23:08.914 --> 01:23:11.987
to get scammed like that.

1988
01:23:12.090 --> 01:23:16.232
But I think what you're doing
with the director

1989
01:23:16.336 --> 01:23:18.855
"character" in this movie
is different

1990
01:23:18.959 --> 01:23:22.066
because it just shows you
how easy it is

1991
01:23:22.169 --> 01:23:25.414
for anyone to get taken in.

1992
01:23:25.517 --> 01:23:27.174
I don't think of myself
as a scammer.

1993
01:23:27.278 --> 01:23:29.418
But I'm an actor.

1994
01:23:29.521 --> 01:23:33.387
So to me,
this is just another role.

1995
01:23:33.491 --> 01:23:35.976
- I'm auditioning today
for the role of the director.

1996
01:23:36.080 --> 01:23:37.771
- The director.
- The director.

1997
01:23:37.874 --> 01:23:39.462
- I'm Joslyn Jensen,

1998
01:23:39.566 --> 01:23:41.740
and I'm auditioning
for the role of the director.

1999
01:23:41.844 --> 01:23:44.571
[dark music]

2000
01:23:44.674 --> 01:23:51.647
♪