Massachusetts Secretary of State William Galvin said Wednesday that the state’s securities division will launch a sweep of businesses in the state raising money from marijuana-related investments, as he’s seen an uptick in marijuana-related fraud cases.
The Massachusetts Securities Division brought its second unregistered securities compliant related to marijuana in the past two months, prompting Galvin to recently issue investor guidance on putting money into the cannabis industry.
Galvin’s office levied a charge Wednesday against David A. Caputo and his former company, Positronic Farms Inc., for raising capital through the offer and sale of unregistered securities to at least 25 Massachusetts investors, as well as investors in eight other states.
Galvin recently charged another Massachusetts man in connection with an unlicensed medical marijuana scheme that resulted in the loss of millions of dollars of investor money.
In the investor alert, Galvin warns Massachusetts citizens that fraudsters may exploit high-profile industries, such as cannabis, to attract the attention of investors and take their funds.