Former MoviePass executive accused of embezzling $260K from employer to repay Coachella debut
LOS ANGELES - A former executive of cinema subscription service MoviePass was arrested for alleging embezzling $260,000 from MoviePass’ parent company to repay money he borrowed to produce an event at the Coachella music festival, the .
FBI agents arrested Khalid Itum, 42, of Hollywood, on Tuesday; he was charged with two counts of wire fraud and two counts of money laundering.
Itum pleaded not guilty to the charges, and was released on $75,000 bond.
According to the indictment, Itum was a MoviePass executive from November 2017 to March 2019.
According to the Justice Department, in the spring of 2017, Itum registered Kaleidoscope Productions LLC, a company that provided production and marketing services. That year, Itum, through Kaleidoscope, organized a party at the Coachella music festival. But neither MoviePass nor its parent company participated in the event.
Officials say Itum borrowed money from two individuals to help fund Kaleidoscope’s costs at Coachella. To repay the borrowed money, Itum allegedly submitted sham invoices to HMNY, a New York-based data analytics company that acquired MoviePass, for services purportedly rendered by Kaleidoscope.
Itum allegedly told HMNY employees to wire money from MoviePass and HMNY accounts to a Kaleidoscope bank account to pay the sham invoices, the indictment said.
Itum allegedly concealed his scheme by lying to HMNY’s auditor that Kaleidoscope had been used to pay legitimate MoviePass expenses from the 2018 Coachella festival.
According to the indictment, Itum caused HMNY a total loss of $260,000,
If convicted of all charges, he could face up to 20 years in federal prison for each wire fraud count and up to 10 years in federal prison for each money laundering count.