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Movie company accused of fraud

Employees of a Burbank movie company face charges of conspiracy and fraud after allegedly bilking investors of $9 million to make independent films.

An indictment from a federal grand jury this week focused on Q Media Assets LLC, located at 2301 W. Olive Ave., with prosecutors alleging that telemarketers for the firm raised funds for two independent films, “Eye of the Dolphin” and the sequel, “Way of the Dolphin.”

Telemarketers “made material misrepresentations, told half-truths and concealed material facts when speaking to investors,” according to an announcement from the Department of Justice on Friday. Investors allegedly promised returns of up to 1,000%.

Nine defendants, including a former CIA agent, allegedly raised about $5 million for “Eye of the Dolphin” and about $4 million for “Way of the Dolphin” from 250 investors, an average of about $36,000 per person.


The first film made about $70,000 in ticket sales, and its sequel went straight to home release.

Contact numbers listed for Q Media Assets LLC were disconnected as of Friday.

Those included in the indictment were: Joel Lee Craft Jr., 41, of San Clemente; James Lloyd, 47, and Jady Herrmann, 34, of Lake Arrowhead; Allen Agler, 54, of Canyon County; Daniel Morabito, 31, of Redondo Beach; Matthew Wellman-Mackin, 30, of Manhattan Beach; Robert Ramirez, 44, of Sunland; and two Florida residents. All of them face various charges of conspiracy, mail fraud, wire fraud and sale of unregistered securities.

Two of the defendants also face charges of money laundering or tax evasion.


“This is a typical amount for these scams,” said Assistant U.S. Attorney Ellyn M. Lindsay. “They raise millions of dollars, and victims are devastated by this kind of loss.”

Often those soliciting the funds will claim their investors are qualified according to security laws — meaning they have a certain net worth and make enough money annually — but those claims are frequently false, Lindsay said.

The 33-count indictment was part of another investigation into a Sherman Oaks film company, Cinamour Entertainment LLC, which allegedly raised $17.7 million for a film that flopped and one that was never made. Both companies allegedly bought lead lists from the same company and shared some of their employees.

Lloyd, Agler, Craft and Morabito were also charged in the Cinamour indictment.

“The two are really connected because it’s the same kind of the investment scam,” Lindsay said. “The Los Angeles area is full of these ‘boiler room’ operations.”

“Most of these [victims] are not sophisticated investors and get taken for,” she added.

The investigation was a collaboration between the FBI and Internal Revenue Service.

Those charged face a maximum penalty of five years in federal prison for conspiracy, up to 20 years for wire fraud and mail charges and up to 10 years for money laundering. The sale of unregistered securities and tax evasion charges carry maximum sentences of five years in prison.