Until this past week, Etienne Uzac may have been best known as the co-founder of Newsweek’s former parent company. Now, Uzac is being accused of “conspiring with two other companies to defraud lenders” that the media company allegedly “used to keep itself in business”. The case will be heard in New York Supreme Court.
According to the indictment, IBT Media and Christian Media “convinced equipment lenders” that the companies required financing to purchase computer equipment. They got the funds, but ended up using them to prop up other areas of business. According to the prosecution in the case, IBT Media colluded with Christian Media Corporation and Oikos Networks to carry out the fraud scheme.
Details of the allegation state that IBT Media and Christian Media Corporation “concealed details” about the funds by using a “fictitious auditor” to conduct a faux audit, then followed this up by presenting faked financial statements. Prosecutors allege Oikos delivered computer equipment that was “of poorer quality” that what was shown on lending agreements, so the companies would spend less than they claimed to have spent.
According to prosecutors, the monies left over were funneled to Uzac, IBT Media, and Christian Media Corporation. These companies then used some of the funds to pay back financing unrelated to the deal.
Uzac fired back, strongly denouncing the allegations while promising to “vigorously” defend himself and his reputation against the charges. In a statement, Uzac “flatly denied” these allegations and he went on to claim that this was a “retaliatory action” against him in revenge for a report published in the International Business Times that made certain claims about the Manhattan District Attorney’s office. One claim is that prosecutors learned of allegations against Hollywood producer Harvey Weinstein, but declined to press charges. That kind of allegations became a serious PR issue once Weinstein was outed by several alleged victims in stories that kicked off what is now being called the #MeToo Movement.
Uzac claims the entire issue is much ado about nothing in an attempt to tarnish his name. “The equipment lenders in question have been repaid in full along with interest and fees… There were no victims, and my intention never was to harm anyone. The fact that the Manhattan DA are inserting themselves where they should not and are defending financial institutions who themselves are not pressing any charges nor have expressed any issues, is a clear case of government power abuse.”
Clearly, if this case continues, and Uzac is found guilty, he intends to go down with rhetorical guns blazing.
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