Carl Erik Rinsch had already expended over $44 million of Netflix's funds when the streaming behemoth transferred him an extra $11 million in March 2020 to finalize a sci-fi series titled “White Horse.” However, according to the federal indictment, the production was never brought to completion. And not one installment was broadcast.
TL;DR
- Carl Erik Rinsch is accused of defrauding Netflix of $11 million for a sci-fi series that was never completed.
- Prosecutors allege Rinsch diverted funds to personal accounts, lost money on stock trades, and spent remaining gains on luxury items.
- He faces charges of wire fraud, money laundering, and illegal monetary transactions, potentially leading to 90 years in prison.
- Rinsch maintains his innocence, with his defense suggesting a psychological condition may have affected his intent.
Federal prosecutors assert that Rinsch redirected almost all of those monies into his own investment accounts, squandered half of it on risky stock transactions, recouped it via digital currency, and subsequently embarked on an extravagant spending spree featuring five Rolls-Royces, a single Ferrari, and two custom-made Swedish beds, totaling $638,000.
Rinsch, 48, appeared for his court proceedings in a Manhattan federal courthouse on Tuesday morning, accused of wire fraud, money laundering, and illegal monetary transactions, which together could result in a maximum of 90 years incarceration. He has maintained his innocence and refused to comment on a potential plea agreement. His primary legal counsel, Daniel Adam McGuinness, was unavailable for immediate comment regarding Coins2Day's inquiry, but he had previously told Business Insider, “Mr. Rinsch is looking forward to the opportunity to show that these charges are not founded and that he’s completely innocent.”
Fabled White Horse disappears
In 2018, Netflix surpassed Amazon, HBO, Apple, and other entities to acquire “White Horse”—which was subsequently renamed “Conquest”—a science fiction drama concerning a synthetic humanoid race. Actor Keanu Reeves, who had featured in Rinsch’s sole full-length movie, the 2013 box-office bomb “47 Ronin,”, acted as an initial backer and advisor for the endeavor. According to The New York Times, Netflix committed to a payment of $61.2 million for the series' distribution rights, and it also afforded Rinsch a privilege it had only extended to a select few filmmakers before: ultimate editorial control. This means he would have the decisive say on the final presentation of his program that would be broadcast.
However, manufacturing encountered difficulties right away. Rinsch went over budget during filming in Brazil, Uruguay, and Hungary, and by December 2019, production had halted with no episodes finished. Netflix leaders consented to allocate an extra $11 million to try and save the endeavor, as per court filings.
Instead, prosecutors allege, Rinsch transferred almost all of the $11 million into his personal brokerage account within weeks of receiving it, losing more than half through speculative options trades on a biopharmaceutical company and an S&P 500 ETF—all while telling then-Netflix executive CIndy Holland the project was going “awesome” and “game changing good.” He later invested the remaining funds in cryptocurrency and generated roughly $10 million in gains, which prosecutors say he spent on luxury goods, credit card debt, divorce attorneys, and legal fees incurred in suing Netflix for additional payments.
Rinsch notably covered the cost of two mattresses—one $439,900 Hästens “Grand Vividus” mattress in black and another $210,400 “Vividus” mattress in white, both fabricated in Sweden and representing two of the most expensive mattresses in the world—yet he subsequently asserted the beds were meant as set pieces for a subsequent season that Netflix had not greenlit.
’A state of psychosis’
Rinsch’s defense has signaled it might contend that his psychological condition made him unable to establish the intent necessary for fraud. Legal documents suggest his legal team intends to summon psychiatrist Dr. John Mariani, anticipated to affirm that Rinsch was experiencing a “state of psychosis” throughout the specified timeframe, possibly worsened by prescribed medications and the COVID-19 outbreak. Nevertheless, the prosecution has asserted it is “not making any argument or submitting any evidence that Mr. Rinsch was or is insane.”
Netflix has previously secured a $11.8 million civil arbitration judgment against Rinsch, who is currently characterized by his legal representatives as “indigent” and “unemployed.” The proceedings overseen by U.S. District Judge Jed Rakoff are anticipated to span a fortnight and will include statements from Former Netflix executives, including Cindy Holland, who originally obtained the endeavor during her tenure as vice president of original content. Holland is since been hired by Paramount as the established studio endeavors to reconfigure itself as a streaming-era rival to Netflix, with both reportedly bidding for Warner Brothers Discovery.
For this story, Coins2Day generative AI assisted in creating a preliminary version. A human editor confirmed the data's correctness prior to its release.
