A Hollywood writer-director was arrested Tuesday (March 18) on charges that he swindled US$11mil (RM48.7mil) from Netflix for a sci-fi show that never aired, instead steering the cash toward cryptocurrency investments and a series of lavish purchases that included a fleet of Rolls-Royces and a Ferrari.
Carl Erik Rinsch – perhaps best known for directing the film 47 Ronin – has been charged with wire fraud and money laundering over what federal prosecutors allege was a scheme to defraud the streaming giant.
Prosecutors said Netflix had initially paid about US$44mil (RM195.1mil) to purchase an unfinished show called White Horse from Rinsch, but eventually doled out another US$11mil after he said he needed the additional cash to complete the show.
Rather than using the extra money to wrap up production, Rinsch quietly transferred the money to a personal brokerage account, where he made a series of failed investments that lost about half of the US$11mil in two months, according to prosecutors.
The filmmaker then dumped the rest of the money into the cryptocurrency market, which proved to be a profitable move, with Rinsch eventually transferring the earnings into a personal bank account, according to an indictment.
From there, Rinsch spent about US$10mil on personal expenses and luxury items in a spending spree that, according to prosecutors, included about US$1.8mil on credit card bills; US$1mil on lawyers to sue Netflix for more money; US$3.8mil on furniture and antiques; US$2.4mil for five Rolls-Royces and one Ferrari; and US$652,000 on watches and clothes.
Rinsch, 47, was arrested in West Hollywood, California, and had an initial court hearing on Tuesday.
He appeared in a federal courtroom in Los Angeles in a turtleneck sweater and jeans with shackles on his arms and legs.
He did not enter a plea and spoke only to answer a judge’s questions. When asked if he’d read the indictment against him, he said "not cover to cover” but told the judge he understood the charges.
US Magistrate Judge Pedro V. Castillo ordered that he be released later Tuesday after he agreed to post a US$100,000 (RM443,587.20) bond to assure he’ll appear in court in New York, where his indictment was filed.
His newly appointed attorney, Annie Carney, declined to comment outside court.
She said during the hearing that she had not yet seen the prosecution’s evidence against Rinsch. When discussing the terms of his release, she said, "the allegations in this case are purely financial.”
Rinsch's New York court date had not yet been set.
Netflix declined to comment. – AP
