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Thousands of investors no longer have access to their accounts for investments made in a cannabis firm. Who is behind this, how big is the damage?
The dimensions are still unclear, some estimate the damage at several million, others at several billion euros. That’s how much money small investors around the world may have paid for an unsafe cannabis plant offering.
Juicyfields promised huge profits
The firm named Juicyfields offered so-called “E-growing” since 2020. At Juicyfields, investors could participate in planting, harvesting and selling medicinal cannabis plants. Profits were up to over 100 percent annually.
“People just aren’t used to making big profits”, so defended the business model in early March in a conversation with DW Daniel Gauci, spokesperson for entrepreneurship and “in charge of innovation” at Juicyfields. But he was not ready to answer the question, how the firm could achieve such profits.
The firm’s most important tool was an online platform. There users could buy, sell plants, manage them in virtual greenhouses and receive the money they had earned. Whether the plants ever existed is unclear after current events.
Because since mid-July, users were no longer able to access this platform. A little later, the company’s content on social media platforms also disappeared. It has since been hinted at, which connoisseurs of this branch have always feared, that Juicyfields is a fraud. Investors’ money is gone.
Another big exit scam?
According to Juicyfields data, 500,000 users must have been registered on the platform. They come from Europe, Asia, Africa as well as Latin America. The minimum limit of an investment in virtual cannabis was 50 euros, the upper limit theoretically 180,000 euros. Money could go in and out through bank transfers or through cryptocurrencies such as bitcoin.
Dividend payments have been made smoothly for a long time, as DW investors have repeatedly assured. Many small investors boasted about their profits and often poured even more money into this firm. Some have even taken out loans. Juicyfields relied on social marketing, engaged influencers, was omnipresent at fairs and invested heavily in advertising.
There is speculation on the forums that the Juicyfields case could become as big as the OneCoin cryptocurrency scam – initiated by Ruja Ignatova. The “Cryptoqueen” was recently added to the list of most wanted persons by the American federal police FBI. The damage caused by OneCoin is said to amount to four billion dollars.
But the dimensions of the fraud at Juicyfields can only be speculated so far. Estimates range from tens of millions to sums reaching into the billions. According to media reports, a Spanish law firm, which represents small investors, claims that more than nine billion have flowed through Juicyfields’ digital “wallets”, crypto-accounts.
A fraud case as a police thriller
Interests of up to 100 percent were promised for different types of cannabis
Similar to the OneCoin case, it is becoming clear that Juicyfields is based, at least in part, on a pyramid scheme. Deposits from new customers are used for payments to be made. Parts of so-called multi-level marketing are also used. Investors get bonuses if they can convince others about the product. Apparently many people assumed that there would be very high profits in the cannabis sector.
This branch is considered a growing industry, since cannabis has been allowed as a medicinal product in many countries. In Canada and some US states this drug has been legalized even for recreational use. Even the German government is planning full legalization.
In Europe, the Spanish supervisory authority had already warned about Juicyfields. German watchdog Bafin first pointed out the discrepancies in March of this year. In June it banned Juicyfields from selling any more cannabis plants on its platform in Germany. The firm did not respect this decision. Thus, even after the ban, the DW research team was able to purchase a virtual plant.
Who is behind this?
It is now becoming clear that investors may never see their money again. The atmosphere in the many groups of the telegram messenger service, where they are organized, is heated. There are several versions circulating on the Internet about what happened: the most widespread is that the Russians must have planned a hoax from the beginning. In another version, it is suspected that parts of the management team may have fled with the money.
Even the name of a firm based in Berlin appears again and again. It maintains strong ties in Switzerland, Liechtenstein and the Netherlands. And Juicyfields has launched in Berlin. It was probably the investigations by the country’s criminal police and increased pressure from the supervisory authority that led to the company’s relocation to the Netherlands by the end of the year.
A podcast series from DW
DW has followed the rise of the suspicious firm for half a year. In the investigative, multi-part, English-language podcast “Cannabis-Cowboys – a story about big dreams, juicy money, and a never-ending hype”, DW reporters tell the story of the firm.
It’s about greed, money laundering and secret services, and the lifelong dream of getting rich quick. The search leads to cannabis plantations, wild parties in luxury hotels and a castle in Switzerland. You can find the first episode from mid-August on the DW English website./DW
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