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Stories of Interest
- Address at ICI's 2017 Securities Law Developments Conference - SEC Commissioner Stein
- New York Pension Fund Seeks More Pay Disclosure from Wells Fargo
- Wells Fargo Sanctions Are on Ice Under Trump Official
- Josh Brown: Here's How to Buy Bitcoin, But Realize It Could Be One Giant Bubble
- Trump's New Tax Plan Could Cost Citigroup $20 Billion
- Morgan Stanley Fires Former Congressman Harold Ford Jr.
- Al Franken Will Resign Over Sexual Misconduct Allegations - His Full Resignation Speech
- Ex-NFL Player Gets 40 Years for Running $10Mn Fraud
- Bitcoin Blows Past $15K, Adding $2K in Under 12 Hours
- Financial Adviser Settles Charges for Defrauding Private Equity Fund Investors
- New Cross Market Equity Supervision Report Cards - FINRA Phone-In Workshop, WebEx Presentation
- Mueller Just Crossed Trump's Red Line, With Deutsche Bank Subpoena
- Wildfire Rages Near Los Angeles
- Former Company Insider Has $4.1Mn Payday as a Whistleblower
- Audit Firm, Anton & Chia, Conducted Fraudulent Audits of Penny Stock Companies - SEC
- Mueller Subpoenas Deutsche Bank Records on Trump and Family
- Bitcoin Nearly Halfway to $400Bn Value Predicted by Winklevoss Twins 4 Years Ago
- Fidelity Clients Suffer Second Website Glitch in Week
- CBOE Beats CME to Bitcoin Futures Launch with December 10 Start
- McKinsey Senior Exec Thomas Barkin Named New Head of Federal Reserve Bank of Richmond
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NEWSLETTERS & ALERTS
Marijuana Consulting Firm's Bogus Scheme Goes Up In Smoke – SEC
A California-based company and its founder agreed to pay $12.3 million in disgorgement, prejudgment interest and penalties to settle SEC charges that it falsely touted "record" revenue numbers to investors and claimed to be a leader in the marijuana industry, while some of its earnings came from sham transactions with a secret affiliate.
ACCORDING TO THE SEC'S COMPLAINT, … Medbox (now known as Notis Global) provided marijuana consulting services and claimed to sell vending machines known as "Medbox" devices capable of dispensing marijuana based on biometric identification. The SEC alleges that Vincent Mehdizadeh created a shell company called New-Age Investment Consulting to carry out illegal stock sales and used the proceeds from those sales to boost Medbox's revenue.
Medbox then issued press releases headlining the phony revenues as record earnings to legitimize itself as a viable commercial operation when in fact nearly 90% of the company's revenue in 2014 stemmed from sham transactions with New-Age.
Mehdizadeh used the money raised in New-Age's illicit stock sales, in part, to purchase a luxury home in the Pacific Palisades. [for a heady price, I'm sure.]
The SEC also charged Medbox's then-CEO Bruce Bedrick, New-Age and Yocelin Legaspi, Mehdizadeh's then-fiancée. The SEC's litigation continues against all three.