I don't think it's a true story. Usually, such characters and their tales are the product of the author's imagination to engage and captivate the audience.
No, it's not a true story. It's likely fictional, created for entertainment or to convey a certain message.
It's not based on reality. Most likely, the man called Otto is a figment of the writer's creativity, crafted to tell an interesting and perhaps thought-provoking story that doesn't draw from actual events.