News update
NEW YORK (AP) — A Hollywood director was convicted Thursday on charges that he scammed Netflix out of $11 million for a show that never materialized, while he instead used the cash for lavish purchases that included several Rolls-Royces, a Ferrari and about $1 million in mattresses and luxury bedding.
Carl Erik Rinsch, best known for directing the film “47 Ronin,” was convicted of wire fraud, money laundering and other charges, according to court records and a spokesperson for federal prosecutors in New York.
In a statement, Rinsch’s attorney, Benjamin Zeman, said he thought the verdict was wrong and “could set a dangerous precedent for artists who become embroiled in contractual and creative disputes with their benefactors, in this case one of the largest media companies in the world, finding themselves indicted by the federal government for fraud.”
Prosecutors said Netflix had initially paid Rinsch about $44 million for an unfinished sci-fi show called “White Horse,” and then sent over an another $11 million after he said he needed additional funding to wrap up the production.
But instead of putting the money toward the show, Rinsch steered the cash to a personal account where he made a series of failed investments, losing around half of the $11 million in a couple months, according to prosecutors.
He then put the remaining funds into the cryptocurrency market, netting some profit, though Rinsch then deposited the money into his own bank account.
Then came the lavish purchases, prosecutors said, with Rinsch buying five Rolls-Royces and one Ferrari, along with $652,000 on watches and clothes. He also bought two mattresses for about $638,000 and spent 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, prosecutors said.
Rinsch, 48, never finished the show. His sentencing date is set for April.
Netflix declined to comment.
U.S. Attorney Jay Clayton, in a statement, said Rinsch “took $11 million meant for a TV show and gambled it on speculative stock options and crypto transactions.”
“Today’s conviction shows that when someone steals from investors, we will follow the money and hold them accountable,” Clayton said.
