A Washington state cannabis farm was the focus of a multimillion-dollar Ponzi scheme, an illegal example of the sudden-riches mentality in the legal marijuana industry, according to federal officials.
Investors plowed $4.85 million into the alleged scheme from Green Acres Farms near Anacortes, Washington, according to a U.S. Securities and Exchange Commission complaint.
Many of the investors – lured by promises of huge profits – used retirement funds or family loans.
Instead of investing the proceeds into the marijuana farm, Robert Russell, of Duvall, and his California-based executive partner, Guy Scott Griffithe, spent $3.5 million of investors’ money on luxuries such as a 2008 Bentley Continental, a 2012 Mercedes Benz C-Class, a 2015 Porsche Panamera and a yacht, the SEC said.
The SEC’s complaint, filed in federal court in Santa Ana, California, charges Russell and Griffithe with civil violations of federal securities law and seeks return of “ill-gotten gains.”
No criminal charges were filed.
“Griffithe and Russell exploited popular interest in the cannabis industry to obtain millions of dollars from investors who thought they were buying into a profitable business,” Melissa R. Hodgman, associate director of the SEC’s Enforcement Division, said in a statement.
The SEC said Green Acres Pharms was never profitable.
The Washington State Liquor and Cannabis Board has permanently discontinued Green Acres Pharms’ license to produce and process cannabis.
– Associated Press
Written by John Rebchook.
View the original article at here.
Marijuana Business Daily