Eaze Cannabis CEO Bank Fraud Scheme (Case Study 73) скачать в хорошем качестве

Eaze Cannabis CEO Bank Fraud Scheme (Case Study 73)

Eaze Cannabis CEO Bank Fraud Scheme: This case study profiles California cannabis delivery company Eaze Technologies, Inc. (Eaze), its former CEO James Patterson, and two foreigners, Hamid Akhavan and Ruben Weigand, who have been accused of conspiracy to commit bank fraud. The charges against these defendants all result from online consumer transactions for the purchase of cannabis. All the information in this case study comes from three sources: one Memorandum Order issued from the US District Court for the Southern District of New York, one criminal indictment, and one newspaper article. In this case, Patterson, Akhavan, and Weigand have been charged separately via a charging document filed by federal prosecutors called a Criminal Indictment. Typically, after federal authorities learn of criminal activity, the investigators turn the results of their investigation over to federal prosecutors. Federal prosecutors review the information. If they believe a person committed a crime, the prosecutors seek a criminal indictment against the defendant. A criminal indictment requires the empaneling of a grand jury. Prosecutors introduce evidence to the grand jury outlining the case against the named defendant. The grand jury puts the case to a formal vote for or against indictment as to whether or not probable cause exists that a crime occurred. Here, the federal grand jury indicted people for white-collar crimes. In this case study, Eaze has not been charged as a defendant related to these criminal charges. As a brief background, we can describe Eaze as a marijuana delivery service. Customers order their cannabis online, pay for the products online, and Eaze delivers it to the consumer. Despite initial impressions that this may be a case involving allegations of illegal drug trafficking (since marijuana has been listed as a Schedule I controlled substance by the Drug Enforcement Agency), this case involves a white-collar crime called Bank Fraud. Federal prosecutors define Bank Fraud as: Whoever knowingly executes, or attempts to execute, a scheme or artifice— (1) to defraud a financial institution; or (2) to obtain any of the money, funds, credits, assets, securities, or other property owned by, or under the custody or control of, a financial institution, by means of false or fraudulent pretenses, representations, or promises; and shall be fined not more than $1,000,000 or imprisoned not more than 30 years, or both. In this case, the grand jury charged defendants with conspiracy to commit bank fraud stemming from an alleged scheme to deceive banks into processing more than $100 million in marijuana sales. These marijuana sales had been intentionally misidentified in banking systems to avoid detection by the banks. In layman’s terms, Patterson, Akhavan, and Weigand, have been charged with lying to the banks about the types of transactions on the Eaze website in order to trick the banks into accepting and processing the transactions. Large financial institutions in the United States have been reluctant, and intentionally slow, to process credit and debit card transactions involving cannabis. Since the federal government continues to outlaw cannabis sales, banks will not process transactions with businesses that engage in cannabis sales. In order to trick banks and credit card companies into processing and clearing cannabis payments, schemers intentionally mislabel the cannabis payments as some other legal category. When a company mislabels payments for cannabis, investigators and prosecutors will characterize the deception as the white-collar crime of bank fraud. Patterson pled guilty to one count of conspiracy to commit bank fraud. Patterson also agreed to cooperate against Akhavan and Weigand in their criminal trials. Patterson’s agreement to plead guilty may result in a lighter prison sentence. The criminal trials for Akhavan and Weigand will take place in 2021.