The New Jersey Bureau of Securities ordered a Las Vegas-based online entity to stop offering fraudulent, unregistered securities in the form of investment packages for cannabis products.
In a cease-and-desist notice issued Dec. 6, Buy Cannabis Stocks Investments Inc. (BCSI) was directed to “immediately stop” violating New Jersey’s securities laws by offering bogus stock packages related to pharmaceutical, medical cannabis, legal hemp/CBD oil and legal cannabis, according to Attorney General Matthew Platkin.
An investigation by the Bureau of Securities revealed BSCI offered securities that are neither registered in New Jersey, federally covered or exempt from registration, and promised investors monthly returns ranging from 7.5% to 55%.
Platkin
To lend an air of legitimacy to its enterprise, BCSI fabricated documents, including one purportedly signed by the Bureau’s acting chief indicating that the company was registered as a broker-dealer, Platkin said.
The Bureau also found BCSI used “a litany of false claims” to promote its investment packages, including omitting material facts to potential investors such as the identity of its principals, how investors funds would be used, and the risks of their investment plans; listing phony addresses for its places of business; and falsely claiming to be authorized to sell securities.
According to Platkin, BCSI also posted bogus testimonials and circulated fake fliers for a supposed cannabis legislation summit it claimed to be sponsoring.
“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 judgement and common sense.”
Fais
“Legal cannabis is an emerging industry, which makes it prime hunting ground for financial predators who will use every trick in the book to lure investors into their schemes,” said Cari Fais, acting director of the Division of Consumer Affairs. “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.”
BCSI did not immediately respond to a request for comment.
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