Director Carl Erik Rinsch has been sentenced to 30 months in prison for defrauding Netflix out of $11 million that was intended for the completion of a sci-fi series that he ultimately failed to deliver. U.S. District Judge Jed Rakoff also mandated three years of supervised release and ordered Rinsch to repay Netflix the full amount in restitution.
Rinsch, known for directing the 2013 film “47 Ronin,” had received over $44 million from Netflix for his production company to create a series initially titled “White Horse,” later renamed “Conquest.” However, in 2020, amid the COVID-19 pandemic, he requested an additional $11 million to finish the project. Instead of directing the funds toward production, prosecutors revealed that Rinsch diverted the money into a personal brokerage account and ultimately failed to deliver the show.
Court filings reported that Rinsch quickly incurred a loss of $5.9 million through speculative stock options, basing trades on volatile markets, including investments tied to a COVID-19 drugmaker. He then moved roughly $4 million of the remaining funds into the cryptocurrency market, specifically purchasing Dogecoin. His investment paid off significantly when the value of Dogecoin surged, leading him to cash out nearly $27 million in May 2021. Following this windfall, Rinsch engaged in extravagant spending, purchasing five Rolls-Royces, a Ferrari, a $388,000 Vacheron Constantin watch, and expending millions more on luxury items, totaling about $8.7 million.
Rather than return the misappropriated funds, Rinsch attempted to sue Netflix for over $14 million, claiming he was owed additional money. His case was dismissed by an arbitrator, leading to a jury conviction for charges including wire fraud and money laundering in December. Although he faced a potential sentence of up to 90 years, prosecutors sought five years in prison. The defense introduced evidence of an untreated mental health condition along with testimonies from Rinsch’s family and colleagues, highlighting notable changes in his behavior since 2019, which contributed to the lighter sentence.
During the sentencing, Judge Rakoff acknowledged the role that “improper medication” may have played in Rinsch’s actions but stated that he was intent on deceiving Netflix to secure significant funds. U.S. Attorney Jay Clayton emphasized that Rinsch’s actions of engaging in high-risk investments and his subsequent lavish lifestyle were deeply concerning, and the ruling aims to serve as a deterrent against similar misconduct in the future.
