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Massachusetts warns of potential marijuana investment scams

June 19, 2019 GMT

In this March 27, 2007, file photo, Massachusetts Secretary of State William Galvin testifies before a House committee at the Statehouse in Boston. Galvin says his office is planning to crack down on what he said is the growing number of Massachusetts-based businesses raising money from marijuana-related investments. The Democrat said Wednesday his office has seen an uptick in marijuana-related fraud cases. (AP Photo/Stephan Savoia, File)

BOSTON (AP) — Massachusetts Secretary of State William Galvin says his office is planning to crack down on what he said is the growing number of Massachusetts-based businesses raising money from marijuana-related investments.

The Democrat said Wednesday that his office has seen an uptick in marijuana-related fraud cases.

Galvin said those engaging in fraud may exploit high-profile industries, such as marijuana-related businesses, to attract the attention of investors and take their funds.

He cautioned potential investors to be wary of unsolicited investment offers.

Galvin also said that while the cultivation and sale of marijuana is now legal in Massachusetts, it continues to be illegal under federal law.

He said federal and state chartered banks may refuse to accept deposits from the sale of marijuana-related products or refuse to make loans to marijuana-related businesses.