Director sentenced to more than two years for defrauding Netflix out of $11m | US news

Hollywood writer-director Carl Rinsch was sentenced to two and a half years in prison Monday after being convicted of defrauding Netflix of $11 million for a never-finished sci-fi series. Fans, including Keanu Reeves, had asked the court to show him tolerance.

Rinsch, known for the 2013 samurai fantasy film 47 Ronin, was convicted of federal wire fraud and other charges in December. He told Netflix he needed $11 million to finish the series, White Horse, but transferred the money to a personal account and ended up spending large sums on luxury cars, watches, clothes and household items, including $638,000 on two beds, according to prosecutors and trial testimony.

Rinsch, 48, and his attorneys told the court Monday that his behavior was triggered by mental health issues and medication issues, and that he is now addressing those issues with a new care provider.

“This process has forced me to confront things about my health, my decisions, and my life,” Rinsch said. He apologized for his behavior, acknowledged that “real harm was caused” and explained: “I failed to recognize the danger of the situation I was in.”

His psychological problems were not disclosed in court, and he and his lawyers later refused to describe them in detail.

Prosecutors argued that Rinsch, who owes approximately $11 million in compensation, should be sentenced to five years in prison.

Prosecutor David Markewitz told the court that “Mr. Rinsch had every advantage possible, including family money, an elite education, famous friends and a successful career.” Rinsch’s motive was “naked greed,” the prosecutor said.

Rinsch, who also goes by the name Carl Erik Rinsch professionally, hails from the Los Angeles area and began making short films in his teenage years. He later directed commercials and attracted attention with the movie 47 Ronin, starring Reeves. His character leads rogue samurai seeking revenge for the murder of their master.

In a letter to the court before Rinsch’s sentencing, Reeves said Rinsch “brought extraordinary joy and warmth to the people around him” and “provided creative inspiration to others with his creativity and vision.”

The Matrix star said he didn’t know the details of the case, but acknowledged that Rinsch “could have self-sabotaged by expanding the scale, scope and landscape of what was being negotiated.” He said he hoped the principal’s sentence could be “mitigated by measures of tolerance and mercy as well as justice.”

Prosecutors said Netflix first paid Rinsch about $44 million for “White Horse” in 2018 and 2019, then provided him with another $11 million in 2020 after he said he needed more money to complete production.

But instead of investing the money in the show, Rinsch diverted the money to a personal account and made a series of failed investments, losing nearly half of the $11 million within a few months, according to testimony from prosecutors and witnesses.

They said he invested the remaining funds into the cryptocurrency market and made some profit, which Rinsch deposited into his own bank account.

Then came the lavish purchases, in which Rinsch purchased five Rolls-Royces, a red Ferrari, $652,000 worth of watches and clothing, expensive beds, as well as $295,000 worth of luxury bedding and linens, prosecutors said. He also used some of the money to pay credit card bills of about $1.8 million, prosecutors said.

US district judge Jed S Rakoff said Rinsch’s mental health issues “may explain some of the excesses” but “does not diminish the court’s conclusion that Rinsch was determined to lie to get a significant amount of money from his Netflix lie to cover it up”.

Rinsch wrote on a piece of paper on the table in front of him as Rakoff announced the prison sentence. One of his lawyers, Benjamin Zeman, patted the director on the back.

Rinsch, who will go to prison in September, hugged many people who came to support him after the court. He and his lawyers declined to comment as they left, but lawyer Daniel McGuinness said they looked forward to appealing the case.

Netflix declined to comment on its punishment.