Bernhard Fritsch, Founder of StarClub Inc., faces up to 20 years in prison after being convicted of a $20 million fraud scheme that targeted investors with false promises of a revolutionary celebrity app while spending their money on yachts and mansions.
At a Glance
- Bernhard Fritsch was found guilty of wire fraud for scamming investors out of over $20 million with his celebrity app StarSite
- From 2014 to 2017, Fritsch falsely claimed partnerships with major companies like Disney and fabricated revenue figures
- Instead of developing the app, he spent millions on luxury items including cars, yachts, and a Malibu mansion
- The scheme involved celebrities like Enrique Iglesias and Tyrese Gibson who were potentially affected
- Fritsch faces up to 20 years in federal prison at his upcoming sentencing hearing
False Promises and Hollywood Connections
A Los Angeles jury has found Bernhard Eugen Fritsch, 63, guilty of one count of wire fraud for orchestrating an elaborate scheme that defrauded investors of more than $20 million. As founder and CEO of StarClub Inc., Fritsch pitched his app, StarSite, as a revolutionary platform that would help celebrities monetize brand endorsements and connect with fans. The Department of Justice revealed that Fritsch deliberately misled investors about the company’s financial performance and future potential to secure their investments.
From 2014 to 2017, Fritsch raised substantial funds by presenting StarClub as a groundbreaking technology for the entertainment industry. He falsely claimed to have secured deals with major companies including Disney and fabricated revenue figures to entice investors. One victim invested over $20 million based solely on these false claims, which subsequently led other investors to pour money into what they believed was a promising venture with connections to Hollywood celebrities like Enrique Iglesias and Tyrese Gibson.
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Luxury Lifestyle Funded by Fraud
Rather than using investor funds to develop the StarSite app as promised, Fritsch diverted millions to support an extravagant lifestyle. Law enforcement officials seized numerous luxury items purchased with the fraudulent funds, including expensive automobiles, a yacht, and a lavish Malibu mansion. Court records show that prosecutors estimate victim losses at approximately $25 million, highlighting the extensive damage caused by Fritsch’s deceit.
According to the Department of Justice: “Fritsch, 63, was found guilty by a jury on Thursday of one count of wire fraud after it was revealed that he lied to investors about the financial success and future potential of his tech company”.
This isn’t Fritsch’s first encounter with legal troubles. Fox News Digital reported that he has been sued in Los Angeles County Superior Court three times over allegations of fraudulent financial schemes. Despite his history of questionable business practices, Fritsch managed to convince investors of his app’s legitimacy through elaborate presentations and false documentation of celebrity partnerships and revenue streams.
Legal Outcomes and Consequences
While the jury found Fritsch guilty of one count of wire fraud, he was acquitted of a second wire fraud count. He currently remains free on bond as he awaits his sentencing hearing. If given the maximum penalty, Fritsch could spend up to 20 years in federal prison for his role in the multi-million-dollar fraud scheme that left numerous investors with substantial financial losses. The case highlights the increasing problem of technology investment fraud targeting those eager to capitalize on celebrity-endorsed ventures.
The Department of Justice continues to investigate potential co-conspirators in the scheme. Although Fritsch operated as the primary architect of the fraud, questions remain about the involvement of others who may have helped facilitate the deception. The FBI has emphasized its commitment to pursuing all individuals who participated in misleading investors and misappropriating funds, sending a clear message to would-be fraudsters targeting the entertainment industry.
