New Jersey Attorney General Matthew Platkin ordered an internet company to stop offering fraudulent investments related to cannabis products.
Due to the Cease and Desist Order he issued, the NJ Bureau of Securities directed the online company Buy Cannabis Stocks Investments Inc. (BCSI) to stop offering bogus investment stock packages related to pharmaceutical, medical cannabis, legal hemp, CBD oil, and legal cannabis products that promised investors monthly Returns on Investment (ROI) ranging from 7.5% to 55%. Their actions violated New Jersey’s securities laws.
To seem legitimate, BCSI fabricated documents, including one allegedly signed by the Bureau’s Acting Chief indicating that BCSI was registered with the Bureau as a broker-dealer.
“This is a brazen example of how scam artists exploit “hot” industries to trick investors who are eager to get in on the ground floor of the next big thing,” said Platkin. “We will continue to monitor the online offering of financial products to identify and put a stop to scams like this one. And we urge investors to avoid letting the excitement of a new market cloud their good judgment and common sense.”
“Legal cannabis is an emerging industry, which makes it a prime hunting ground for financial predators who will use every trick in the book to lure investors into their schemes,” said Acting Director of the Division of Consumer Affairs Cari Fais. “The BCSI website is a chief example of this. Investors must do their homework and verify the legitimacy of all investment products, especially those making false promises of high returns with low risks.”
The Bureau found BCSI was committing fraud in connection with the offer and sale of securities on its website by promoting its investment packages with many false claims.
The blatantly deceptive conduct included:
- Omitting facts to potential investors, such as the identity of their principals, how investor funds would be used, and the risks of their investment plans.
- Falsely claiming to be authorized to sell securities.
- Posting bogus testimonials from clients that use photos from the Internet, including one of a person from a reality television show.
- Circulating a fake flyer for an alleged cannabis legislation summit sponsored by BCSI.
- Listing phony addresses for their places of business.
The investigation by the Bureau of Securities was conducted by Supervising Investigator Rachel Glasgow and Investigator Meryl Griff Hubscher of the Bureau of Securities. That is within the Division of Consumer Affairs.
The Bureau is charged with protecting investors from investment fraud and regulating the securities industry in New Jersey.
The fact that cannabis has been illegal for so long complicates the legalization process. While there are indeed many good-hearted people, there are of course, many bad apples that need to be dealt with.
Cannabis legalization is so lucrative that people call it the Green Rush. Some corporations that are Multi-State Operators (MSOs) are publicly traded cannabis stocks which means the public can invest in them. They vary wildly in quality. Overall, they are no doing well due to President Joe’s Biden indifference to cannabis legalization and Congress’ disagreements over details.