Filmmaker Carl Erik Rinsch has been handed a prison sentence after being convicted of defrauding Netflix out of millions of dollars.
The director, 48, had been hired by the streamer to create a sci-fi series and later received an additional $11 million for the production, on top of an earlier $44 million budget.
Prosecutors said that instead of spending that money on the show, Rinsch diverted it for his own use and paid for an extravagant lifestyle.
Rinsch is widely known for directing the 2013 film 47 Ronin.
He was found guilty on charges including federal fraud and money laundering linked to the misuse of the funds. If given the maximum penalties, he could have faced decades behind bars.
He has now been sentenced to two and a half years in prison, followed by three years of supervised release.
In addition, he was ordered to forfeit $11 million and pay a $700 special assessment.
Addressing the court, Rinsch apologized and said he accepted responsibility. US Attorney Jay Clayton said in a statement: “Today’s sentence sends a deterrent message: Fraud will not be tolerated.”
The New York trial lasted a week and included testimony from several Netflix executives.
They told the court the company had signed off on a single season of a series titled White Horse.
According to the evidence presented, Netflix first allocated $44 million to the project. Rinsch later requested another $11 million, saying it was needed to complete the season, though the series was never finished.
Instead of using that extra funding for production, prosecutors said he transferred the money into a personal bank account.
From there, he began making investments and reportedly lost roughly half the sum within a matter of months.
Prosecutors said his spending spree included cryptocurrency purchases, luxury cars including Rolls-Royces, and mattresses costing hundreds of thousands of dollars. They also pointed to a $395,000 charge for a stay at the Four Seasons hotel.
While testifying, Rinsch argued that he believed the extra payment was intended to keep the production operating during the Covid-19 pandemic, claiming the situation came down to a misunderstanding.
Netflix eventually cancelled White Horse in 2021, and only teaser footage was ever completed.
FBI Assistant Director Leslie Backshies had previously accused Rinsch of using Netflix’s money to ‘finance lavish purchases and personal investments instead of completing a promised television series’.
She added: “The FBI will continue to reel in any individual who seeks to defraud businesses.”