Netflix Filmmaker Carl Erik Rinsch Charged With Misusing $11 Million on Crypto and Stocks

YEREVAN (CoinChapter.com) — Carl Erik Rinsch has been charged with fraud and money laundering, accused of misusing $11 million from Netflix instead of funding the production of a science fiction TV series. The Department of Justice (DOJ) unsealed the indictment on March 18 in a Manhattan federal court, stating that Rinsch faces a maximum sentence of 20 years for these charges.

The DOJ alleged that Netflix, which was not directly named in the court filing, transferred $11 million in March 2020 for storyboarding, hiring actors, and editing footage for the show initially titled “White Horse”, later renamed “Conquest.” Instead of spending the funds on production, Rinsch allegedly used the money for crypto and stock trading.

Netflix Funds Allegedly Used for High-Risk Trading

Authorities claim that Rinsch moved about $10.5 million into a brokerage account and used it for high-risk stock market trades, including call options on a biopharmaceutical company. The trades reportedly resulted in $5.5 million in losses. While losing funds, Rinsch assured Netflix that Conquest was progressing.

In early 2021, Netflix canceled the project, according to a report by The New York Times, which had previously covered the dispute. The publication reported that Netflix paid Rinsch $55 million, but prosecutors allege that he received $44 million for the production, which remains unfinished and unaired.

Crypto Gains and Extravagant Spending

Prosecutors claim that while Rinsch lost millions in stock trading, he made several million dollars trading cryptocurrency in February 2021. Instead of investing the profits back into the project, authorities allege that he spent the money on luxury items. Court filings state that Rinsch used $3.8 million to purchase furniture and antiques. Additional funds were spent on five Rolls-Royces, a Ferrari, high-end watches, and designer clothing worth over $3 million.

Fraud and Money Laundering: Maximum Sentences

Prosecutors charged Rinsch with one count of wire fraud, one count of money laundering, and five counts of unlawful monetary transactions. Each fraud and money laundering charge could result in a maximum sentence of 20 years. Each monetary transaction charge carries a penalty of up to 10 years in prison.

Authorities arrested Rinsch on March 18 and assigned the case to Judge Jed Rakoff in New York federal court. The Associated Press reported that Rinsch’s lawyer, Annie Carney, declined to comment on the case.