A Hollywood director and writer famous for his work on the movie "47 Ronin" was taken into custody on Tuesday, accused of fraudulently obtaining $11 million from Netflix for a science fiction show that never made it to the screen.
Breitbart reported that Carl Erik Rinsch has been charged with wire fraud and money laundering, as alleged by federal prosecutors, for diverting funds intended for his unfinished show "White Horse" into cryptocurrency ventures and luxurious personal acquisitions.
Rinsch, 47, was arrested in West Hollywood, California, and appeared before a court on the same day. In a courtroom in Los Angeles, dressed casually in a turtleneck sweater and jeans, Rinsch faced charges amid allegations of a complex fraudulent operation.
Prosecutors outlined that Netflix had initially agreed to pay approximately $44 million to acquire Rinsch's incomplete show. However, Rinsch reportedly requested an additional $11 million, justifying the need for further funds to complete the project.
Instead of channeling this additional sum towards finishing the show, the director allegedly moved the money to his personal brokerage account. Federal prosecutors indicated that around half of this investment was lost over a period of two months, marking the beginning of a larger deception.
Subsequently, Rinsch redirected the remaining funds into cryptocurrency markets. This move eventually turned profitable, enabling him to transfer his earnings into a personal bank account, further complicating the trail of the money.
Upon securing the funds, Rinsch reportedly indulged in a lavish lifestyle. Prosecutors allege that the filmmaker spent approximately $10 million on various extravagant items. These expenses included $1.8 million allocated for paying off credit card bills.
Included in the spending spree was $1 million directed towards legal fees in an effort to sue Netflix for additional funds.
Furthermore, Rinsch allegedly invested $3.8 million in high-end furniture and antiques, according to the indictment.
Prosecutors also allege that Rinsch's spending extended to luxury automobiles, with $2.4 million spent on acquiring five Rolls-Royces and a Ferrari. Additionally, nearly $652,000 of the funds were spent on watches and clothing, further supporting claims of his lavish use of the funds.
Facing the allegations, Rinsch made an appearance in a Los Angeles federal courtroom with restraints on his arms and legs.
During the proceedings, he did not submit a plea but acknowledged understanding the charges against him, despite not having fully read the indictment.
U.S. Magistrate Judge Pedro V. Castillo authorized Rinsch's release under the condition of a $100,000 bond to guarantee his presence for a court appearance in New York, where the indictment was filed.
Rinsch's legal representation, Annie Carney, declined to comment in detail outside the courtroom. During the hearing, Carney noted that she had not yet reviewed the evidence presented by the prosecution. She emphasized that "the allegations in this case are purely financial," further illustrating the nature of the charges.
Netflix has not offered any commentary on the case, maintaining silence regarding the developments surrounding Rinsch's indictment.
The absence of a formal response leaves speculation about the company's stance on the issues at hand.
The actions attributed to Rinsch represent a significant breach of trust within the entertainment industry, underscoring the intersection of financial malpractice and creative ventures. The unfolding legal matters are yet to define the broader implications for Hollywood and streaming platforms alike.
Rinsch's future court date in New York has not been scheduled, leaving open questions regarding the timeline of the legal process. As the story continues to unfold, it underscores the complexities and challenges faced by companies navigating financial commitments within the entertainment sector.
