A director of a failed Netflix series has been arrested on fraud charges for allegedly scamming the streaming giant out of $17 million.
Carl Erik Rinsch was arrested in Los Angeles on Tuesday after being accused of spending the budget meant for the show on failed stocks, cryptocurrency, expensive cars, and two mattresses that totaled more than $1 million.
In 2018, Netflix initially paid $70m for the series during a competitive bidding war for the 47 Ronin director’s new project, titled White Horse, which was to tell the story of a scientist who invents a humanlike species that turns against their creators.
He later demanded additional funds from Netflix to complete the show after claiming he was only able to film one episode on the money he had been given.
However, he never delivered any episodes of the show, which Netflix had later renamed Conquest.
The director transferred “the funds he received through a number of different bank accounts before consolidating them in a personal brokerage account,” prosecutors said in a news release. He then “used those funds to make a number of personal and speculative purchases of securities,” they said.
In less than eight weeks he lost half of the $17 million Netflix had given him.
He then used the remaining money “to speculate on cryptocurrency, and on personal expenses and luxury items,” including legal fees related to his divorce and five Rolls-Royces and one Ferrari.
“As alleged, Carl Erik Rinsch orchestrated a scheme to steal millions by soliciting a large investment from a video streaming service, claiming that money would be used to finance a television show that he was creating,” acting US Attorney Matthew Podolsky said in a statement. “But that was fiction. Rinsch’s arrest is a reminder that this Office and our partners at the FBI remain vigilant in the fight against fraud and will bring those who cheat and steal to justice.”
Rinsch has been charged with wire fraud, money laundering and multiple counts related to engaging in transactions stemming from illegal activity.
If the director is convicted, he faces a maximum term of 90 years in prison if the sentences are served consecutively.
Last year, an arbitrator ruled that he owed the company nearly $14 million.
[Notigroup Newsroom in collaboration with other media outlets, with information from the following sources]
