Theodore Farnsworth, the former CEO of Helios and Matheson Analytics, parent company of MoviePass, has pleaded guilty to charges of securities fraud and conspiracy. He faces up to 25 years in prison.
Farnsworth made “materially false and misleading representations” about MoviePass’ business model between 2017 and 2019, aiming to attract new investors. The statements artificially inflated the company’s stock price.
His former colleague, J. Mitchell Lowe, also pleaded guilty to securities fraud last September and faces a maximum of five years in prison.
According to the US Department of Justice, Farnsworth falsely claimed that MoviePass used artificial intelligence to monetize subscriber data. However, he knew this was not true.
MoviePass initially gained popularity with its $9.95 monthly subscription service, but it was unsustainable and burned through cash before shutting down two years after its launch. The company has since relaunched with limited changes.
Source: https://edition.cnn.com/2025/01/08/business/moviepass-former-ceo-guilty-theodore-farnsworth/index.html