Khalid Itum, 42, was arrested Tuesday and charged with two counts of wire fraud and two counts of cash laundering, the US Division of Justice stated in a assertion. Itum, a Jordanian citizen who lives in Los Angeles, pleaded not responsible and was launched on a $75,000 bond.

In 2017, earlier than becoming a member of MoviePass, Itum created Kaleidoscope Productions LLC and borrowed cash from two people to placed on the social gathering throughout the April music competition in Indio, east of Los Angeles, in keeping with the indictment. In November 2017, he turned an government at MoviePass, which had been acquired by Helios & Matheson Analytics a couple of months earlier. 

To repay the cash he owed for Coachella social gathering, Itum submitted sham invoices to Helios & Matheson for providers purportedly rendered by Kaleidoscope and a special firm he owned, prosecutors stated. The corporate paid the invoices, regardless that neither Helios & Matheson nor MoviePass had been concerned within the Coachella occasion, prosecutors stated. Itum left the corporate in March 2019.

MoviePass initially gained reputation after launching its subscription plan in August 2017, and inside a 12 months it reached its membership peak of three million. However working losses led the corporate and its father or mother out of business by January 2020.

The indictment comes simply months after two former MoviePass executives, Theodore Farnsworth, 60, and J. Mitchell Lowe, 70, had been charged with securities and wire fraud for allegedly defrauding traders. The 2 had been sued by the US Securities and Alternate Fee over comparable allegations.

Itum’s trial date is ready for April 18. If convicted of all fees, he may withstand 20 years in federal jail for every wire fraud depend and as much as 10 years in federal jail for every cash laundering depend.