Moviepass Execs Charged With Criminal Fraud
The executives of the failed movie-a-day subscrfption service are accused of selling the Moviepass’ “unlimited” subscription tier model when both allegedly knew the model was nothing more than a temporary marketing gimmick.
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Theodore Farnsworth and Mitchell Lowe, CEOs of Helios and Matheson Analytics and their subsidiary Moviepass, respectively, were charged for their roles in a securities fraud scheme last Friday according to a Department of Justice release. Moviepass, a failed startup that attempted to offer a subscription where users could see movies in theaters as often as they wanted, went under in 2019. Farnsworth and Lowe are accused of selling Moviepass’ “unlimited” subscription tier model to investors as tested and sustainable when the company was not capable of profiting from the subscription and both co-conspirators allegedly knew the model was nothing more than a temporary marketing gimmick.
“As these charges make clear, the Department, together with our law enforcement partners, will hold corrupt C-Suite executives who engage in securities fraud accountable for their actions,” Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division said in the DOJ announcement.
