SEC Crucifies Cannabis Investment Promoter

SEC Crucifies Cannabis Investment Promoter

SEC Crucifies Cannabis Investment Promoter

Source: SEC Charges Cannabis Investment Fund and Founder in Fraudulent Scheme  

SEC charged Texas-based Greenview Investment Partners and founder Michael Cone with “defrauding investors with false promises of massive returns in cannabis-related businesses.” 

Cone ended up with more than $3 million from investors.

“Greenview allegedly exploited investor interest in the marijuana industry and lied about high returns and the backgrounds of its key executives,” said Shamoil T. Shipchandler, Director of the SEC’s Fort Worth Regional Office. “Investors must remain vigilant and not let the fear of missing out dupe them into making bad investment decisions.”

The SEC also issued a separate alert to warn of media coverage around legalization that leads to hype and to “urge investors to consider the risks of investment fraud and market manipulation before investing in a marijuana-related company.”

The Securities and Exchange Commission today charged a Texas-based investment fund and its SEC Crucifies Cannabis Investment Promoterfounder with defrauding investors with false promises of massive returns in cannabis-related businesses.  The SEC also issued an alert to warn retail investors about marijuana-related securities offerings.

The SEC’s complaint alleges that Greenview Investment Partners L.P. and its founder Michael E. Cone used misleading marketing materials in raising more than $3.3 million from investors.   Cone allegedly employed boiler room sales staff who made cold calls to investors and promised them up to 24 percent annual returns from investments in Greenview.  According to the complaint, Cone used an alias to conceal his prior criminal convictions, lied about having a former agent from the U.S. Drug Enforcement Administration on staff, and falsely claimed to have a long record of profitably investing millions in cannabis-related businesses.  The complaint alleges that, in reality, Greenview had no track record and its sole investment of $400,000 was in a cannabis company that had yet to harvest a crop.  According to the complaint, Cone spent investors’ money on designer clothes and luxury cars, and on payments to earlier investors to prolong the alleged scheme.  In a parallel criminal proceeding, the U.S. Attorney’s Office for the Central District of California charged Cone and seized approximately $1.4 million in cash and assets.

“Greenview allegedly exploited investor interest in the marijuana industry and lied about high returns and the backgrounds of its key executives,” said Shamoil T. Shipchandler, Director of the SEC’s Fort Worth Regional Office. “Investors must remain vigilant and not let the fear of missing out dupe them into making bad investment decisions.”

SEC Crucifies Cannabis Investment Promoter

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Author: abizcannabis

Managing Director & CEO of integrated transactional financial advisory, tax, and technology consulting firm - aBIZinaBOX Inc New York, Chicago, and OaklandCPA.CITP.CISM.CGEIT.CGMAExpertise with: Alt. Investments/Private Equity, Real Estate, Professional Services, CA Cannabis, Tech Start-Ups and Distressed Assets/DebtTechnology Certifications including:Advanced & High Complexity Cloud Integrator AICPA PCPS, CAQ,, IMTA, CITP ISACA CGEIT, CISMState CPA Societies in California, Florida, Illinois, New York and TexasExpertise with Regulatory Compliance - US - HIPAA, FINRA, SEC Rule 17(a)(3)/(4), eDiscovery, FINCEN - EU- EBA, ESMA, EIOPA UK - BoE, PRA, FCA