Money laundering in the film industry: how it works and what banks check

On or about 6 March 2020, a streaming company sent $11 million to a company controlled by the director Carl Erik Rinsch to finish a science fiction series. Within days, Rinsch began moving the money through numerous bank accounts into a personal brokerage account. After a federal trial in New York, Rinsch was convicted in December 2025 of wire fraud and money laundering, and on 29 June 2026 the court imposed 30 months in prison and $11 million in forfeiture.

No law required the director's company to run an AML program. The money still moved through bank and brokerage accounts, and the firms holding those accounts are the ones the law obliges to look.

How is money laundered through the film industry?

Court records show three routes through film, each a money laundering typology that leaves a different trace in a bank account.

In the first, criminal money goes in as production finance. Between June and November 2012, eleven wires totaling $64 million went from Red Granite Capital's account to Red Granite Pictures' account at a US bank and paid for its operations, including The Wolf of Wall Street, according to the government's amended forfeiture complaint. The government alleged that the money had been diverted from 1MDB, Malaysia's sovereign wealth fund. Spent on a film, it had reached the integration stage.

In the second, a company attached to the production bills for work that was never done. An indictment returned on 20 August 2025 charges David Raymond Brown, a producer and production accountant, with causing production companies to pay Hollywood Covid Testing LLC, a company Brown organized and operated, for services never rendered or already paid for, on false or duplicate invoices (Justice Department release). The invoices made the transfers look like production expenses, the cover a front company gives illicit money. Brown is presumed innocent.

In the third, money raised for a film is diverted and moved on. Rinsch's $11 million passed through several accounts on its way to a brokerage account, the layering that hides where money came from. Zachary Horwitz raised at least $650 million on the claim that the money would buy rights to films two streaming platforms had agreed to distribute abroad. The deals did not exist, and earlier investors were paid with later investors' money from 2014 until 2021, a Ponzi scheme that ended in a 240 month sentence.

Jason Cloth is charged with telling investors their money would fund a specific film while using it for a real estate project in Canada and to repay earlier investors, according to the indictment filed on 23 July 2026. Cloth is presumed innocent.

Under 18 USC 1957, knowingly spending or moving more than $10,000 of proceeds of specified unlawful activity in one monetary transaction is a federal offense of its own. Brown faces ten counts of that transactional money laundering, and Rinsch was convicted on five, on top of the fraud.

What do the recent film cases show?

Table 1. Film finance cases, as of November 2026

Red Granite is the only US case in the table where criminal money went into a film. The US cases filed or decided in 2025 and 2026 run the other way: money raised for film was taken out and moved on. The first crime is fraud against investors, production companies or a streaming company, and it becomes fraud and money laundering when the proceeds pass through accounts to hide their source. Cloth faces fraud counts only. For a bank, this pattern shows in the production account's outflows.

Why does film finance suit launderers?

A feature film is usually made by a company formed for that one film. The company takes money from several sources, pays many suppliers within months and winds down once the film is delivered. A launderer can use each step.

The money arrives in pieces: equity from investors, pre sales of foreign distribution rights, bank or gap loans and public incentives. With that many sources, one more investor does not stand out.

Nobody outside the deal can price a script, an unfinished cut or a package of foreign rights, so an inflated investment or rights purchase has no market price to be checked against. Horwitz's investors were shown film license agreements with sales agents and distribution agreements with two streaming platforms; all were fake, and Horwitz's company had no deal with either platform.

The payees are many and short lived: crew, location owners, equipment houses, caterers, post production firms. A fake vendor among the real ones is hard to see, and when the film is done the company stops trading and its accounts close.

Is film financing covered by AML rules?

Not as of November 2026. The US list of financial institutions in 31 USC 5312(a)(2) names insured banks, dealers in precious metals, vehicle sellers and casinos among others, and no studio or producer.

The UK list of relevant persons in regulation 8(2) of the Money Laundering Regulations 2017 reaches art market participants but no film business. From 10 July 2029, Article 3 of the EU's AML Regulation covers football agents and professional football clubs, and still no film business.

Like any US trade or business, a production company files Form 8300 when it receives more than $10,000 in cash, but checking who stands behind the money falls to the bank. In complead, formerly Sanction Scanner, that check runs in the client screening and ongoing monitoring product, whose 3,500+ sanctions, PEP and watchlists from 220+ jurisdictions, refreshed every 15 minutes, screen each financier, producer and owner. When the film is delivered and its company winds up, monitoring of those names can be stopped one by one through API triggers.

What happened with Red Granite Pictures and The Wolf of Wall Street?

Start with the account in Singapore, as the government's amended complaint of August 2017 tells it. Riza Aziz, a Malaysian national, helped set up Red Granite Pictures in 2010. The complaint calls Aziz "a relative of" a senior Malaysian official who also held authority over 1MDB, which makes Aziz a relative or close associate of a politically exposed person.

In 2012, three wires totaling $238 million reached Red Granite Capital's account at a bank in Singapore from an offshore company's account in Switzerland, and $64 million went on to the production company. By February 2014, payments from that account to a movie poster dealer had recurred for months. A compliance officer at the bank asked the two relationship managers whether the beneficial owner, who worked in the movie industry, also collected movie memorabilia, which would explain the repeated payments. About four days later, one of them answered yes, in a single sentence.

Read together, the complaint describes a PEP's relative owning the account, one offshore source of funds and a payment pattern explained only by that one sentence reply.

On 20 July 2016, the Justice Department filed civil forfeiture complaints alleging that more than $3.5 billion was misappropriated from 1MDB between 2009 and 2015, in one of the biggest money laundering scandals, and that some of it paid for the production of The Wolf of Wall Street. Red Granite settled through a consent judgment on 8 March 2018, paying $60 million in place of its rights in that film, Daddy's Home and Dumb and Dumber To, with no admission of wrongdoing.

The government filed a notice of satisfaction of the judgment on 25 September 2018. On 2 September 2020, the department settled its cases against assets Aziz acquired with funds allegedly taken from 1MDB, estimated at more than $60 million and including a poster for the 1927 film Metropolis. The department's release adds that a civil forfeiture complaint is merely an allegation.

Which red flags should a bank see in a production company's account?

The flags come from the cases above. One flag is a question for the relationship manager; two on the same account are a reason for a review.

1. Equity from one financier with no traceable source. Red Granite's production money came through a single holding account fed from an offshore company's account in Switzerland.
2. A PEP, or a PEP's relative, behind the money. The complaint describes a Red Granite founder as a relative of a senior Malaysian official.
3. A recurring payment pattern explained in one line. The Singapore bank asked about the poster payments in 2014 and got a one sentence answer.
4. Production money gone within days to a brokerage or personal account. Rinsch's $11 million started moving toward a personal brokerage account within days of arrival.
5. A vendor owned by an insider, or duplicate invoices. Hollywood Covid Testing was run by the person who caused the productions to pay it, according to the indictment.
6. Returns paid from new money, or rights deals the buyer never confirms. Horwitz's license agreements were fake, and Cloth is accused of repaying earlier investors with new investors' money.
7. Fraud news or lawsuits the file never mentions. Brown is accused of hiding a May 2023 Los Angeles Times article on fraud accusations, and fraud lawsuits, from two people who handed money over; adverse media screening at onboarding looks for that kind of record.

How does a compliance team check a film company and its financiers?

Picture an illustrative LLC formed to make one feature film. Two equity investors, a pre sale to a foreign distributor and a bank loan fund the budget, and the LLC opens its operating account at your bank.

Start with the owners. Under FinCEN's order of 13 February 2026, a bank has to verify who owns a legal entity customer in three situations: when the customer first opens an account, when new facts call the ownership data on file into question, and when the bank's own risk procedures require it. A new LLC for each film is a new legal entity customer, so each one triggers the check on its ultimate beneficial owners.

There is no register to compare against. An interim final rule published on 26 March 2025 exempted US companies from beneficial ownership reporting, and FinCEN made that exemption permanent in a final rule issued on 11 August 2026, in force from 14 August. The register built under the Corporate Transparency Act holds no report for this LLC, so the bank's own file is the record.

Both investors, the producer and every owner found are screened for sanctions, PEP status and adverse media at onboarding and for as long as the account stays open. Each investor also shows the source of funds behind the equity: a fund's own investors, a company's accounts, a sale of assets.

Then the money. A production's budget and weekly cost reports say who should be paid, how much and when, so transaction monitoring rules can test the account against that plan: payees outside it, large transfers to brokerage or personal accounts, one vendor's invoices growing faster than the shoot. Look up who owns the larger vendors and compare the names with the producers and crew. In the Brown case, the vendor belonged to the production's own accountant.

When outflows no longer match the film and no document explains them, the analyst escalates and the compliance officer decides whether to file a suspicious activity report.

What do films about money laundering get right?

Five titles that come up in searches for money laundering movies, in no order:

• Ozark (Netflix series, 2017). A financial advisor runs a cartel's cash through local businesses that take cash, from a bar to a casino.
• Breaking Bad (AMC series, 2008). A car wash is bought so drug cash can be mixed with real takings.
• The Laundromat (2019, directed by Steven Soderbergh). Shell companies and nominee directors hide who owns the money.
• The Infiltrator (2016, directed by Brad Furman). An undercover US customs agent poses as a money launderer to get inside a cartel's network.
• The Wolf of Wall Street (2013). A stockbroker hides fraud profits in a Swiss bank account, and the film itself was funded, the Justice Department alleged, with money diverted from 1MDB.

Each plot needs a business that can account for dirty money, and most of them run on cash. The cases in Table 1 moved money by wire into a production company, through a vendor's invoices and through several bank accounts into a brokerage account.

What changed in 2026?

• 13 February: an exceptive relief order from FinCEN limited the bank's beneficial owner check to first account opening, doubt about earlier data and the bank's own risk procedures.
• 29 June: Rinsch was sentenced to 30 months in prison and $11 million in forfeiture.
• 23 July: the indictment against Cloth, on seven counts of wire fraud, was filed in the Northern District of Illinois.
• 11 August: FinCEN made the BOI exemption for US companies permanent in a final rule, effective 14 August.
• No film rule: as read on 11 November 2026, 31 USC 5312, regulation 8 of the UK regulations and Article 3 of the EU AML Regulation name no film business.

Three checks for this week:

1. List every production company account funded mainly by one financier.
2. Rescreen those financiers and the producers behind them for PEP status and negative news.
3. Compare last quarter's outflows on each account with its cost report, and ask about every payee that is not in it.