(A version of this story first appeared on Hemp Industry Daily.)
Federal securities regulators have accused six people of deceiving investors by promising astounding returns as part of an alleged $25 million scam for a supposed marijuana farm and CBD extraction facility in California.
The money was raised from more than 400 investors from across the country between September 2017 and February 2019, according to a lawsuit filed by the U.S. Securities and Exchange Commission in a California federal court.
Here are the basics of the suit:
- One group of companies formed by the individuals raised $12.3 million from 226 investors for a marijuana farm in Salinas, California.
- A second group of companies raised $13.2 million from 211 investors for an extraction facility to produce CBD, also in Salinas.
- The accused individuals, who are all from California or Arizona, claimed the unregistered securities would generate annual returns of “100% or more,” according to the SEC’s complaint.
- The defendants allegedly misappropriated at least $2.7 million of the investor money and lied about a supposed loan that would finance the CBD facility.
The money was raised under nine different entities:
- C Quadrant.
- Extraction Capital Tier 1.
- GPA Enterprises.
- Green Growth Ventures.
- RJ Holdings Group.
- Smart Initiatives.
- Target Equity.
- Valley View Enterprises.
- Zabala Farms Group.
The defendants listed in the complaint are Anthony Todd Johnson, Jeremy Johnson, Richard Portillo, Charles Lloyd, Mark Heckele and Michael Gregory.
The SEC is seeking a permanent injunction blocking the six defendants’ investment activity, plus penalties.
Regulators also are seeking repayment of the funds received from the allegedly illegal conduct, plus interest.
Written by Jeff Smith.
View the original article at here.
Marijuana Business Daily