Director Carl Rinsch sentenced to 2½ years in Netflix fraud case

Hollywood writer-director Carl Rinsch was sentenced mon to two-and-a-half years in prison house after face of the earth convicted of defrauding Netflix come out of $11 trillion US (roughly $15.6 million Cdn) for a never-finished sci-fi series. Supporters including Keanu Reeves had asked the court to show him leniency.

Rinsch, best known for the 2013 samurai fantasy film 47 Ronin, was convicted in December of federal wire fraud and other charges. According to prosecutors and trial testimony, he told Netflix he needed the $11 million US to finish a show called White Horse but diverted the money into a personal account and ultimately spent whopping sums on luxury cars, watches, clothes and household goods, including $638,000 US on two mattresses.

Rinsch, 48, and his lawyers told the court Monday that his behaviour was fuelled by mental health struggles and medication problems, which they said he is now addressing with a new care provider.

"This process has forced me to confront things about my health, my judgment and my life," Rinsch said. He apologized for his behaviour, acknowledged that "real harm was caused," and said he "failed to recognize the danger of the state [he] was in."

His psychological troubles weren't described in court, and he and his lawyers declined to detail them afterward.

Prosecutors argued that Rinsch — who also owes about $11 million US in restitution — should serve five years in prison.

"Mr. Rinsch had every possible advantage," including family money, an elite education, famous friends and a high-flying career, prosecutor David Markewitz told the court. Rinsch's motive, the prosecutor said, "was naked greed."

Rinsch, who also has used the name Carl Erik Rinsch professionally, hails from the Los Angeles area and began making short films as a teenager. He later directed commercials, then got attention for 47 Ronin, which stars Reeves.

Reeves told the court in a letter, ahead of sentencing, that Rinsch brings both "exceptional joy and warmth to the people around him" and "creative inspiration to others through his creativity and vision."

The Matrix star said he didn't know the details of the case, but he acknowledged that Rinsch "can self-sabotage by amplifying the scale, scope and landscape of what had been negotiated." He said he hoped the director's sentence "might be tempered with measures of leniency and mercy as well as justice."

Prosecutors said Netflix initially paid Rinsch about $44 million US for White Horse in 2018 and 2019, then provided another $11 million US in 2020 after he said he needed more money to wrap up production.

But instead of putting that money toward the show, Rinsch steered the cash to a personal account and made a series of failed investments, losing around half the $11 million US in a couple of months, according to prosecutors and witnesses' testimony.

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

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Then came the lavish purchases, prosecutors said, with Rinsch buying five Rolls-Royces, a red Ferrari, $652,000 US worth of watches and clothes, and the pricey mattresses, plus another $295,000 US on luxury bedding and linens. In addition, he used some of the money to pay off about $1.8 million US in credit card bills, prosecutors said.

U.S. District Judge Jed S. Rakoff said Rinsch's mental health difficulties "may explain some of the excesses" but don't "detract from the court's conclusion that he was determined to lie to get substantial monies from Netflix, lie to cover it up."

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

After court, Rinsch — who's due to report to prison in September — hugged several people who had come to support him. He and his lawyers declined to comment as they left, except that lawyer Daniel McGuinness said they looked forward to appealing the case.

Netflix declined to comment on his sentence.

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