Carl Erik Rinsch faces federal fraud and money laundering charges after allegedly misusing millions meant for a sci-fi series.
The U.S. Department of Justice (DOJ) has indicted filmmaker Carl Erik Rinsch, accusing him of diverting $11 million in Netflix funds meant for the production of a sci-fi series into high-risk stock and cryptocurrency trades. Instead of financing the series, Rinsch allegedly used the money to gamble on financial markets, purchase luxury goods, and cover personal expenses, according to court documents unsealed on March 18.
From Sci-Fi Production to High-Stakes Trading
The DOJ claims that in March 2020, Netflix—though not explicitly named in the indictment—provided Rinsch with $11 million to finance the sci-fi series White Horse, later renamed Conquest. The funds were intended for storyboarding, actor payments, and post-production. However, prosecutors allege that instead of using the money for filmmaking, Rinsch transferred approximately $10.5 million into a brokerage account, where he engaged in speculative trading, including risky options bets on a biopharmaceutical company. These trades reportedly led to losses of more than $5.5 million.
Despite his financial mismanagement, Rinsch allegedly continued reassuring Netflix that Conquest was progressing well. However, internal concerns within the streaming giant grew, ultimately leading to the project’s cancellation in early 2021, as previously reported by The New York Times.
While his stock trades largely resulted in losses, Rinsch found more success in crypto markets. According to prosecutors, in February 2021, he made several million dollars trading cryptocurrency. Instead of reinvesting the profits into his TV production, he allegedly spent nearly $3.8 million on luxury furniture and antiques, five Rolls-Royces, a Ferrari, high-end watches, and designer clothing worth over $3 million.
The indictment also details additional spending, including nearly $1.8 million on credit card payments and over $1 million in legal fees to sue Netflix for further compensation and cover costs related to his divorce.
Legal Consequences and Potential Prison Time
Rinsch now faces serious legal consequences, with charges including one count of wire fraud, one count of money laundering, and five counts of engaging in unlawful monetary transactions. If convicted, the wire fraud and money laundering charges each carry a maximum sentence of 20 years in prison, while each of the monetary transaction charges could add up to 10 years.
Federal authorities arrested Rinsch on March 18, and his case has been assigned to Judge Jed Rakoff in a New York federal court. According to The Associated Press, Rinsch’s attorney, Annie Carney, declined to comment outside the courtroom.
While the DOJ’s indictment does not explicitly name Netflix, The New York Times previously detailed Netflix’s troubled dealings with Rinsch. The streaming giant reportedly paid him a total of $55 million for Conquest, while prosecutors claim he received $44 million. The show remains unaired, and given the legal battle ahead, it is unlikely that Conquest will see the light of day.
The case highlights the risks entertainment companies face when funding high-budget productions, especially when financial oversight is lacking. With Rinsch now facing federal charges, the fallout from this legal battle may reshape how streaming giants allocate and monitor production budgets in the future.
HODL Team
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