A former executive at the cinema subscription service MoviePass Inc. was arrested on Feb. 21 on a federal grand jury indictment alleging he embezzled approximately $260,000 from MoviePass’ parent company to repay money he borrowed to produce an event at the Coachella Music Festival, the U.S. Justice Department announced.
Khalid Itum, 42, of Hollywood, was arrested at an undisclosed location by special agents with the FBI. He was charged with two counts of wire fraud and two counts of money laundering.
Itum pleaded not guilty to the charges. He was released on $75,000 bail and is expected to return to court on April 18.
MoviePass was a New York-based company that charged subscribers a flat monthly fee in exchange for credits they could spend on movie tickets at any theater in a network of participating cinemas. Itum was a MoviePass executive from November 2017 through March 2019.
Itum allegedly borrowed money from two individuals who were not identified to fund the event at the Coachella Music Festival, and submitted fake invoices in 2017 to Movie Pass’ parent company Helios & Matheson Analytics. Neither MoviePass nor Helios & Matheson Analytics participated in the Coachella event.
Itum allegedly caused $260,000 in losses to Helios & Matheson Analytics, according to the indictment. The defendant faces 20 years in federal prison for each wire fraud count and up to 10 years in federal prison for each money laundering count.
The FBI’s New York Field Office is investigating the case, with assistance from the FBI’s Los Angeles Office. Assistant U.S. Attorney David Y. Pi of the Major Frauds Section is prosecuting the case.
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