Mitch Lowe and Ted Farnsworth already settled with the FTC over fraudulent activity affecting MoviePass customers, but now the former heads of MoviePass and its parent company, Helios and Matheson Analytics (HMNY), are facing criminal allegations of securities fraud and wire fraud.
The Department of Justice announced the charges today, saying false statements made by both men defrauded investors in HMNY when the execs pretended like the company’s money-losing $9.95 “unlimited” moviegoing plan had any hope of profitability.
HMNY’s own auditor cast doubt on the company’s viability in a report in 2018, but at the time, Farnsworth downplayed the advisory, telling Insider that “pretty much most” companies running at a loss would have a…
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