Ted Farnsworth, the past CEO of MoviePass and individual who conceived the idea to offer limitless movie showings for $9.95 monthly, has confessed to deceiving investors in the subscription service. As stated by the Department of Justice, Farnsworth admitted guilt to one charge of securities fraud along with one charge of conspiracy to commit securities fraud and is looking at a potential 25-year prison sentence.

If you haven’t heard the tale of MoviePass, Farnsworth did not originate the company, which was founded by Urbanworld Film Festival pioneer Stacy Spikes as a reasonably small-scale subscription effort meant to encourage theater attendance. Farnsworth led the analytics firm Helios and Matheson, which acquired a controlling interest in MoviePass in 2017, eventually pushing MoviePass to propose a $9.95-per-month subscription that let viewers enjoy a movie each day.

Despite Farnsworth’s strategy successfully drawing in a large subscriber base—exceeding three million registrants—the difficulties emerged. While Farnsworth made rounds in the media to champion business growth and assert the company would turn a profit leveraging customer data, internally, MoviePass was losing significant amounts of money. Soon enough, MoviePass began retracting its limitless movie offer, implemented viewing restrictions on popular films, faced service disruptions, and shifted prices and options with minimal notice.

It became clear that MoviePass was on the path to collapse with the unveiling of the unlimited plan, yet Farnsworth insisted to investors that the pricing model was viable and independent profitability was attainable. The DOJ, however, determined MoviePass was financially hemorrhaging from this strategy. Likewise, the claim about customer data monetization was an illusion. The Justice Department disclosed that his analytics enterprise “lacked the capability to monetize MoviePass’ subscriber data.” Ultimately, MoviePass had no financial inflows apart from subscriptions—leading to such a fiscal drain that Farnsworth directed employees to limit user access to the service they subscribed to.

After Farnsworth led MoviePass into insolvency, it seems he replicated similar tactics with a different venture named Vinco Ventures. According to the DOJ, Farnsworth and collaborators accumulated funds from investors by providing falsehoods about the business’s condition while channeling money directly to themselves.

The sentencing of Farnsworth is set for later this year. In the meantime, MoviePass is back in the hands of its original founder, Stacy Spikes, and reportedly turning a profit, despite ongoing user complaints about technical issues.