LOS ANGELES
Officials announced Friday that a Malibu man has been convicted of defrauding investors out of more than $20 million by lying about his tech company’s financial performance.
Bernhard Eugen Fritsch, 63, was found guilty late Thursday of one count of wire fraud.
Fritsch faces up to 20 years in federal prison. Sentencing is pending.
Prosecutors said Fritsch, founder and CEO of StarClub Inc. in Santa Monica, raised more than $20 million between 2014 and 2017 to develop a software app designed to help celebrities and influencers monetize brand endorsements on social media, according to authorities.
He falsely claimed StarClub was close to major deals with companies like Disney, had earned $15 million in 2015, and had backing from major investors.
Instead of using the money to grow the company, Fritsch spent millions on a lavish lifestyle, buying luxury cars, including a McLaren and a Rolls-Royce, upgrading his yacht, and renovating his Malibu mansion near Carbon Beach. Authorities have seized the cars and yacht, which are subject to forfeiture.
One investor alone contributed more than $20 million over two years, based on Fritsch’s lies, and introduced him to other victims. Prosecutors estimate total losses at around $25 million.
The jury acquitted Fritsch on a second wire fraud count.