Fraud indict for ex-owners of Newsweek
The ex-parent company of Newsweek ran a $10 million fraud scheme, tricking lenders into loaning large sums to pay for high-end computer servers it never bought, according to an indictment unsealed Wednesday.
Christian Media Corp., IBT Media and their executives instead used the money for daily operations and past financial obligations, Manhattan prosecutors say.
The indictment comes nearly 10 months after Manhattan DA’s office raided Newsweek’s offices for information about its servers.
A few weeks after the raid, Newsweek sacked its editor in chief and deputy editor and targeted for firing three reporters — including former Daily News reporter Celeste Katz — who were covering the DA’s probe and a sex-harassment scandal at the magazine.
The indictment names IBT co-owner Etienne Uzac, exChristian Media CEO William Anderson and computer firm Oikos Networks, which falsely claimed it sold Newsweek servers with price tags from $130,000 to $180,00, the indictment alleges.