Damian Williams, the United States Attorney for the Southern District of New York, announced that WILLIAM SADLEIR has pleaded guilty to two counts of wire fraud in connection with his participation in two schemes related to investments made by a fund New York-based investment company (the “Fund”) in Aviron Pictures, LLC and its affiliated entities (collectively, “Aviron”). SADLEIR is due to be sentenced on May 10, 2022 at 10:30 a.m. by U.S. District Judge Paul A Engelmayer, who presided over yesterday’s oral argument.

US attorney Damian Williams said: “William Sadleir used his talent for selling stories to defraud a New York investment fund of over $30 million using a fake company, fake documents and even a fake In a cheeky plot that could be taken from any of the films he distributed, Sadleir even invented a character he named “Amanda Stevens” and impersonated her in an effort to s “Get away with his fraud. We’ve put an end to Sadleir’s scheming, and he now faces a long sentence in federal prison.”

According to the complaint, indictment and other documents filed in court:

The Fund is a listed closed-end investment fund. The shares of the Fund are traded on the New York Stock Exchange. On or about December 2019, the Fund had approximately $649.1 million in assets.

WILLIAM SADLEIR was the Chairman and CEO of Aviron and oversaw its operations from or around 2015 until or around December 2019. Aviron has been involved in the distribution of a number of films in the United States, including my all american (2015), Kidnap (2017), Strangers: prey of the night (2018), A private war (2018), destination wedding (2018), Serenity (2019), and After (2019).

SADLEIR engaged in two fraudulent schemes related to an investment of approximately $75 million made by the Fund in Aviron.

In one of the schemes (the “Advertising Scheme”), SADLEIR misappropriated millions of dollars of Aviron funds that had been invested in Aviron by the Fund. SADLEIR told the Fund that this money was invested by Aviron in prepaid media credits with advertising placement company MediaCom Worldwide (“MediaCom”), which is a subsidiary of advertising and media agency GroupM Worldwide. Instead, using the bank account of a fake entity he created, SADLEIR illegally transferred more than $25 million of those funds out of Aviron. Specifically, SADLEIR created a fictitious New York-based company called GroupM Media Services, LLC (the “Sham GroupM LLC”) designed to appear as the legitimate entity, GroupM Worldwide, and a corresponding bank account in the name of this fictitious entity. . SADLEIR then used a significant portion of these illegally transferred funds for his personal benefit, including to purchase a private residence in Beverly Hills for approximately $14 million. SADLEIR then falsely told the Fund that Aviron had purchased a balance of approximately $27 million in prepaid media credits from MediaCom that were available to promote future Aviron films, and pledged a portion of those credits to the Fund. as security for additional loans, when in fact the credits claimed did not exist. As part of these misrepresentations, SADLEIR also created a false identity of an alleged New York-based employee of Sham GroupM LLC named “Amanda Stevens” who corresponded with a representative of the Fund, assuring the Fund that Aviron was approximately 27 $. balance of millions of dollars in prepaid media credits with Sham GroupM LLC. But SADLEIR himself posed as Amanda Stevens in email exchanges with a Fund representative.

In the other scheme (the “UCC Scheme”), SADLEIR arranged the illicit and fraudulent sale and refinancing of assets worth over $3 million which secured the Fund’s loans to Aviron. The Fund had secured its investment in Aviron, among other means, by obtaining UCC liens in 2017 and 2018 on certain intellectual properties and other assets related to Aviron’s films. In 2019, SADLEIR used the forged signature of one of the Fund’s portfolio managers on the releases to remove the Fund’s UCC liens on some of these secured assets. SADLEIR did so in order to sell or refinance the assets without the Fund’s consent, thereby depriving the Fund of its security on outstanding loans. Aviron eventually defaulted on these loans.

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SADLEIR, 67, of Beverly Hills, Calif., pleaded guilty to two counts of wire fraud, each carrying a maximum sentence of 20 years in prison and a maximum fine of $250,000 or double that the gross gain or loss of the offence.

The maximum potential penalties in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the accused will be determined by the judge.

Mr. Williams praised the work of the Federal Bureau of Investigation. He also thanked the Securities and Exchange Commission for its cooperation and assistance in this investigation.

This matter is being handled by the Bureau’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Jared Lenow and Elizabeth Hanft are in charge of the prosecution.