The SEC filed a compliant against Michael E. Cone and Greenview Investment Partners, L.P., a cannabis investment fund, for securities fraud. From August 2017 through March 2018, Cone, a convicted criminal, used an alias and a boiler room to fraudulently raise $3.3 million from 60 investors across 26 states. Marketing materials indicated that investor’s fund would be invested in cannabis related businesses that would generate a 24% annual return. In reality, Greenview had no prior track operational track record or investment success. The money was used to fund Cone’s personal expenses, including several luxury cards, and a substantial portion of the money was used to pay ponzi scheme investment returns.
The FBI raided Greenville’s offices in February 2018 and seized $1.4 million in cash and assets including Rolex watches, a 2017 Bentley Flying Spur and a 2015 Rolls Royce Wraith. In March 2018, Cone was arrested on an outstanding warrant in Reno, Nevada.
The SEC also released an Investor Alert that highlights the risk of investing in cannabis related stocks. The SEC states that investors should be wary of any unregistered person contacting them with an investment opportunity that offers a fixed, large rate of return.
Investor Alert: Marijuana Investments and Fraud