U.S. securities regulators secured over US$40 million in disgorgement and penalties against a group of cannabis companies and executives that were accused of defrauding investors.<\/p>\n
A federal court in California entered a final judgment against American Patriot Brands, Inc. (APB), its various subsidiaries and a pair of executives \u2014 former CEO Robert Lee and chief operating officer Brian Pallas \u2014 that raised millions from investors and allegedly diverted much of that money for personal use.<\/p>\n
According to a complaint from the U.S. Securities and Exchange Commission (SEC), APB decided to get into the marijuana business in 2016, acquiring companies that cultivated and distributed cannabis. It had previously operated a food truck business, and was known as The Grilled Cheese Truck Inc.<\/p>\n
To finance its expansion, the company raised capital from investors and allegedly began misleading investors about various aspects of the company, including its financial condition and operations.<\/p>\n
The SEC also alleged that the company funnelled millions of investors\u2019 money to its executives\u2019 personal accounts.<\/p>\n
Now, the SEC has resolved its litigation through a final judgment that ordered US$24 million in disgorgement and interest against the companies \u2014 plus US$13 million in penalties.<\/p>\n
The judgment also ordered US$6.4 million in sanctions against Lee; and a civil penalty of $472,902 against Pallas. It also imposed various injunctions, and banned the executives.\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"U.S. securities regulators secured over US$40 million in disgorgement and penalties against a group of cannabis companies and…\n","protected":false},"author":2,"featured_media":811551,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[45,49,48,10742,26614,20403,188893,12526],"class_list":["post-811550","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business","tag-ca","tag-canada","tag-cannabis","tag-enforcement","tag-fraud","tag-investor-protection","tag-u-s-securities-and-exchange-commission"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/811550","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=811550"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/811550\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/811551"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=811550"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=811550"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=811550"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}