A Filmmaker Promised Netflix A TV Series — He Bought 5 Rolls-Royces Instead: DOJ

LOS ANGELES, CA — A filmmaker accused of scamming Netflix out of $11 million — money that he was supposed to spend on a TV series that was never made — was arrested on Tuesday on a slew of federal charges, according to the U.S. Attorney's Office.

Carl Rinsch, 47, of Los Angeles, was supposed to produce a science fiction series called "White Horse" after inking a deal with the streamer in 2018. But rather than using the funds to complete the series, he blew some $11 million of the production budget on "extremely risky" stock market gambles before his luck turned around in the cryptocurrency market. He ended up spending his crypto wins lavishly — including on five Rolls-Royces and a Ferrari, according to the indictment obtained by Patch.

Court documents do not refer to the streamer by name, but numerous media reports have confirmed that Netflix is referred to as "Streaming Company-1" in the case.

Rinsch is charged with one count of wire fraud, one count of money laundering and five counts of engaging in monetary transactions in property derived from specified unlawful activity.

"Rinsch orchestrated a scheme to steal millions by soliciting a large investment from a video streaming service, claiming that money would be used to finance a television show that he was creating. But that was fiction. Rinsch instead allegedly used the funds on personal expenses and investments, including highly speculative options and cryptocurrency trading," Acting U.S. Attorney Matthew Podolsky said in a statement.

Rinsch inked a deal with the streamer in 2018 to produce the "White Horse" series. He had largely completed six short-form episodes — about 4 to 10 minutes long each — but sought a budget to turn the concept into a full-fledged series, according to the indictment.

The streamers initially paid $44 million between 2018 and 2019 for the show, which is about a scientist who creates a group of super intelligent clones who come into conflict with each other and humans, according to the indictment.

By early 2020, Rinsch told the streamer he needed more money, and successfully got another $11 million. But instead of using that money for production, Rinsch is accused of losing more than half that sum in less than two months on stock market bets, including call options on a biopharmaceutical company, according to the indictment.

About a year later, he transferred the remainder of the $11 million to a cryptocurrency exchange and began making ultimately successful trades. Prosecutors claim he spent $10 million as follows:

• $1.79 million on credit card bills
• $1.07 million on lawyers to sue the streaming company and for divorce lawyers
• $395,000 to stay at the Four Seasons and other luxury rental properties
• $3.79 million on furnishings, including $638,000 for two mattresses and $295,000 on bedding and linens
• $2.42 million on five Rolls-Royces and a Ferrari
• $652,000 on watches and clothing

It was around that time that Netflix canceled development of the show, according to the New York Times.

That came after Rinsch’s behavior turned erratic: He told Netflix executives he had discovered COVID-19's secret transmission mechanism and told his wife, a producer on the show, that he could predict earthquakes and lightning strikes, the Times reported.

The wire fraud charge carries a maximum sentence of 20 years in prison, the money laundering charge 20 years and the five other counts each carry a maximum sentence of 10 years, according to prosecutors.