Director Convicted of Defrauding Netflix
A jury has found Karl-Eric Rinsch, a Hollywood director, guilty of defrauding Netflix out of $11 million intended for shows that never got off the ground. Instead of producing the promised content, he allegedly used the money to support a lavish lifestyle.
As reported by CBS News, federal prosecutors in New York confirmed Rinsch’s conviction on charges including wire fraud and money laundering. Rinsch, known for the film “47 Ronin,” reportedly splurged on luxury items such as several Rolls Royces, a Ferrari, high-end watches, and even extravagant bedding. The Netflix project he was supposed to complete never came to fruition.
U.S. Attorney Jay Clayton remarked that Rinsch “received $11 million for a television show and gambled it on speculative stock options and virtual currency trading.”
Initially, Netflix had invested around $44 million in Rinsch to create a sci-fi series titled “White Horse.” However, when Rinsch sought extra funding, Netflix transferred an additional $11 million. Prosecutors allege that he funneled this money into his personal account, where he quickly lost about half of it through poor investments within months.
Authorities claim that Rinsch instead turned to the virtual currency market, made some profits, and then deposited those funds back into his own account.
In terms of spending, reports indicate he purchased five Rolls-Royces and a Ferrari, as well as spending over $652,000 on luxury watches and clothing. Strangely enough, he also apparently bought two mattresses for roughly $638,000 and spent about $295,000 on premium bedding. To top it off, he used some of the funds to pay down around $1.8 million in credit card debt.
Rinsch’s attorney, Benjamin Zeman, criticized the ruling, arguing that it could create a troubling precedent for artists facing contractual disputes with major backers.
As for Rinsch’s future, he is set to be sentenced in April. Clayton emphasized the importance of accountability, stating, “Today’s conviction shows that when someone steals from investors, we will track those funds and hold them accountable.”
