Hollywood director Carl Erik Rinsch has been sentenced to 30 months in prison after being convicted of defrauding streaming giant Netflix out of $11 million. The sentence was handed down by U.S. District Judge Jed S. Rakoff on Monday.
The Fraud Scheme
Rinsch was found guilty in December of wire fraud, money laundering, and related charges tied to an unfinished science-fiction series originally titled White Horse, later renamed Conquest. Prosecutors said Netflix initially paid Rinsch about $44 million for White Horse in 2018 and 2019, then provided another $11 million in 2020 after he claimed he needed more money to wrap up production.
But instead of putting that money toward the show, Rinsch steered the cash to a personal account and made a series of failed investments, losing around half the $11 million in a couple of months, according to prosecutors and witnesses’ testimony. They said he put the remaining funds into the cryptocurrency market, netting some profit, which Rinsch deposited into his own bank account.
Lavish Spending
Then came the lavish purchases, prosecutors said, with Rinsch buying five Rolls-Royces, a red Ferrari, $652,000 worth of watches and clothes, and expensive mattresses, plus another $295,000 on luxury bedding and linens. In addition, he used some of the money to pay off about $1.8 million in credit card bills.
Judge Rakoff noted that Rinsch’s mental health difficulties “may explain some of the excesses” but don’t “detract from the court’s conclusion that he was determined to lie to get substantial monies from Netflix, lie to cover it up.”
Background
Rinsch is best known for directing the 2013 film 47 Ronin, which starred Keanu Reeves. The case highlights the risks studios face when funding high-profile projects with troubled productions.
