Ozy Media stiffs ‘Genius Award’ recipients out of $10K grants after Carlos Watson arrest

Ozy Media has stiffed a dozen college kids out of their $10,000 “Genius Awards” after the troubled news site’s disgraced founder Carlos Watson was arrested on federal fraud charges, The Post has learned.

The ambitious students — one of them a budding TikTok influencer, others aspiring educators and tech entrepreneurs — have been caught up in the stunning implosion of Ozy Media, which boasted high-profile backers including billionaire Marc Lasry and Laurene Powell Jobs, only to face federal scrutiny over shady business practices.

Ozy Media launched its Genius Awards in 2015.

Past recipients included Amanda Gorman, a former National Youth Poet Laureate, who gained national prominence in 2021 after she recited an original poem titled “The Hill We Climb” at President Biden’s inauguration.

The latest recipients were told in December that Ozy would provide them with months of funding, expert mentorship and free publicity for their startups to “help them realize their dreams.”

Instead, two students told The Post that Ozy Media has cut off all contact since mid-March – days after Watson was arrested on allegedly bilking investors out of $50 million – leaving them without any funding for their budding projects and a hole on their resume instead.

A third student, who spoke to The Post on condition of anonymity, confirmed their accounts.

The program’s presenting sponsor, AT&T, also has been silent on the situation.

“It’s been, honestly, such a roller coaster,” Youssef Hasweh, a 2023 Genius Award winner and 21-year-old junior at the University of Chicago, told The Post.

Ozy Media’s reputation went up in flames after a series of damning reports by the New York Times and other outlets in late 2021 — including one that revealed a top Ozy Media official had bizarrely impersonated a YouTube executive while seeking to secure an investment from Goldman Sachs.

The collapse accelerated in February, when the feds accused Watson of running the once high-flying startup “like a criminal organization” and attempting to bilk investors out of millions of dollars.

“I took a selfie with Carlos. I loved him when I met him,” said Hasweh. “I think some of the most charismatic people can have not the best intentions. I don’t think this is a relationship that can be recovered.”

Watson, who faces 37 years in prison, was accused of attempting to trick a prospective investor by faking a $600 million takeover offer for Ozy, among other alleged misdeeds.

Hasweh, meanwhile, had planned to use the funds he won to launch a student-led scholarship advocacy program for low-income high school students.

“When our junior-year internship was supposed to be the biggest internship on our resume, the biggest job opportunity so far on our CV, a lot of us will end up working part-time jobs or barely finding funds to support ourselves this summer, which is absolutely devastating,” added Hasweh, who has amassed more than 100,000 followers on TikTok, where he shares education-related advice.

The students say they last heard from Ozy in mid-March, when Beverly Watson, Carlos’s sister and the managing editor, told them the company was “forced by the circumstances to suspend its operations,” according to an email obtained by The Post.

Beverly Watson said she did not have “any firm answers” about the Genius program’s future and signaled she would provide another update by the end of March.

“That said, should you find additional opportunities for financing your summer– please do explore them,” Watson told Hasweh in a March 16 email.

A day later, an attorney representing Ozy emailed at least one student to say that prosecutors had “killed operations” and “eliminated all income” by taking action against the company.

The attorney added that Ozy’s caretakers were making “efforts to recover any assets to make a distribution to creditors,” but never followed up.

This year’s Genius Awards were being offered in partnership with AT&T and its “Dream in Black” campaign to “give special emphasis to students attending Historically Black Colleges and Universities,” according to a press release last September.

An AT&T spokesperson said the company was “extremely disappointed to learn that the winners of the Ozy Genius Awards were affected by the shutdown of Ozy Media.”

“We want to make sure that these students receive the stipends that they were promised, and we are looking into this to see what we can do,” the spokesperson added.

When reached for comment, Kenneth Montgomery, a lawyer representing Ozy Media and the Watson family in the upcoming fraud trial, blamed the company’s inability to follow through on its funding pledge on the federal indictment — which targeted both Watson as an individual and the company itself.

“The fact that deserving students have been deprived of funding for their college education is a collateral consequence of the government’s unprecedented prosecution of OZY Media, one of the only Black owned media companies in Silicon Valley,” Montgomery said in a statement to The Post.

“The unwarranted criminal charges brought the company to a complete standstill and forced the cessation of operations,” Montgomery added. “The Watson family firmly believes in making higher education accessible to all, which is why they co-founded Achieva College Prep Service well before Mr. Watson founded OZY.”

“Any people or entities who have valid claims under the company dissolution process will be eligible to submit their claims,” he added.

Ozy first contacted this year’s group of winners last December and immediately began a promotional campaign for the Genius program. All 12 winners filmed clips for “The Carlos Watson Show,” which are still viewable on YouTube and Twitter.

Students received a rough timeline for how the program would proceed. One-on-one meetings with Ozy staffers were set up for February and a connection to a professional “mentor” for May.

The period of June 21 to Sept. 22 was slated for “project implementation,” with a final showcase of each winner’s completed work scheduled for Sept. 29.

Ozy said the students were eligible for “project funds” of up to $10,000, which would be delivered in “three tranches” beginning in June.

Hasweh said he and the other students were “a little confused” when most of February came and went without a follow-up from Ozy Media, but decided to give the company more time to respond.

Instead of an update, the students were blindsided by news of Watson’s arrest.

“I googled Ozy Media, just to see what was up, and that’s when I saw they were actually under investigation,” said Myron Layese, a 21-year-old senior at Berklee College of Music in Massachusetts. “I was like wow, well, that happened. It literally just came out of left field.”

Without any guidance from Ozy Media, the students are now left with no choice but to seek other sources of support for their projects – or abandon them entirely.

“We had signed contracts, we were committed, and we had been getting communication that didn’t make us think that this was going to go awry,” Hasweh said. “Now we all do not have internship opportunities, full-time opportunities – and now it’s too late to apply.”

“As of right now, I’m still pretty open to whatever’s going to come of it,” added Layese, who planned to use the money to fund a virtual reality app called “Stage Fright,” which would use biometric data to help musicians overcome performance anxiety. “I’m really hoping it’s not a lost cause.”

Leading up to publication of this story, the students also expressed frustration that AT&T, the headlining sponsor, hasn’t made an effort to communicate.

“I’d like for them to speak up, or at least make a comment or something,” said Layese. “I think it makes sense for them to take some ownership.”

Two other Ozy executives, former chief operating officer Samir Rao and chief of staff Suzee Han, have already pleaded guilty to fraud and other charges. In a separate case, the SEC charged Watson with attempting to scam investors out of some $50 million.

Watson has maintained his innocence. In February, Watson’s lawyer, Lanny Breuer, said he was “deeply disappointed” in the decision to arrest his client, who had been cooperative with investigators.

Months after Watson’s arrest, Hasweh remains particularly upset about the fact that Ozy cited its work with “the Ozy Genius Awards supporting more than 50 young creators” in a defensive statement shared on Instagram on Feb. 24.

“Behind the scenes, I’m struggling to even know if I’m going to have an opportunity this summer and they’re sort of putting us on this podium and this pedestal to make Ozy look better,” Hasweh said.