On September 27, 2021, The New York Times reported a series of scandals at Ozy involving fraud and executive misbehavior.

[5] On October 1, after significant negative media attention,[2][6] Ozy's board of directors announced that the company would cease operations.

The company raised a $5.3 million seed round of funding in December 2013 backed by Laurene Powell Jobs, founder of Emerson Collective.

[5] In October 2014, Ozy announced that German media giant Axel Springer had invested $20 million in the company.

[20] In January 2017, Ozy announced a $10 million Series B round of fundraising, led by Michael Moe's GSV Capital.

[24] Several major news outlets questioned the legitimacy of these claims, and investors subsequently sued, alleging fraud and concealment.

[27] In October 2021, Variety announced that such media-buying agencies were no longer willing to do business with Ozy in light of its duplicitous and alleged illegal behavior.

[6][32] In 2019, Ozy produced a television show that aired on the Oprah Winfrey Network and won an Emmy for Outstanding News Discussion and Analysis.

[37] On September 26, 2021, the New York Times reported that Samir Rao, COO and a co-founder of the company, had impersonated a YouTube executive on a conference call with Goldman Sachs.

[38][5] Following media coverage of Rao's impersonation, Ozy's board of directors asked him to take a leave of absence and announced that they had engaged the law firm Paul, Weiss, Rifkind, Wharton & Garrison to undertake a review of the company's business practices.

[41][42] The company's chairman Marc Lasry resigned after three weeks on the job and said in a statement, "I believe that going forward Ozy requires experience in areas like crisis management and investigations, where I do not have particular expertise.

Osbourne denied that she or her husband had been investors, saying, "This guy is the biggest shyster I have ever seen in my life", adding that during their legal battle she had declined shares in Ozy that Watson offered her.

[10] On October 1, 2021, Watson, who had just been re-elected to a second three-year term as a corporate director of NPR, resigned immediately before a governance committee was planning to meet to determine his future.

"[10] The next day, LifeLine Legacy Holdings, a fund management company that invested more than $2 million, filed a lawsuit claiming Ozy "engaged in fraudulent, deceptive and illegal conduct.

[49] Axios noted the company would continue to face multiple issues in its attempted recovery, including investigations by the U.S. federal government and by outside law firms.

They also noted that it remained unclear how much cash Ozy has on hand, and that the board of directors now includes only Watson and venture capitalist Michael Moe.

[12] Conway subsequently surrendered his shares in Ozy and hired law firm Wilson Sonsini to represent the ex-employees in a suit against the company.

Vice World News observed that the article's author, "a journalist with the suspicious name of Hugh Grant", was depicted with a stock photograph.

Suzee Han, Ozy's former chief of staff, pleaded guilty to fraud conspiracy charges on February 14, and told a magistrate judge that she falsified financial information about the company at the direction of two unidentified executives.

Rao, Watson, and Ozy also face a civil lawsuit from the United States Securities and Exchange Commission, which alleges that the executives and the company lied to investors.

Two other Ozy executives, co-founder Samir Rao and chief of staff Suzee Han, had pleaded guilty and testified for the prosecution at trial.

[26] Ozy's digital magazine focused on profiles of rising stars and trends, often rehashing stories covered previously by other media without any original interviews or reporting.

In his farewell email to Watson and Ozy COO Samir Rao, Bessey wrote, "You are playing a dangerous game with the truth.

[72] In 2016 an event dubbed "Ozy Fest" was launched, which until 2018 was held in Rumsey Playfield at Central Park in New York City.

[82][83] Ozy has hosted an irregular scholarship program since 2015,[84] awarding 10 college-aged applicants with a $10,000 grant to pursue a "genius idea".

[85] Among the 2017 class of Ozy Genius Award winners was poet Amanda Gorman, who later rose to fame for reading "The Hill We Climb" at the inauguration of Joe Biden in 2021.