Hemp Industry Daily reports
U.S. government officials say an Indiana company illegally steered as much as $4 million to several hemp companies while its president used more than $1.7 million in investor funds for personal benefit, in claims made public last week.
George S. Blankenbaker Jr., president at Indianapolis-based Stevia Corp., agreed to plead guilty to two counts of federal wire fraud and one count of money laundering in federal criminal court, and to pay almost $5.2 million in civil penalties in a separate preliminary settlement with the U.S. Securities & Exchange Commission (SEC).
Both cases are related to what the agency said was a scheme that included “ponzi-style” payments in which new investor money was used to cover dividends owed existing shareholders, and other expenses.
Stevia Corp. is an over-the-counter “penny stock” company that develops products from the stevia plant, which produces a natural sweetner of the same name. The company began touting hemp as early as 2015, and Blankenbaker formed several entities in recent years related to hemp and CBD production.
Prosecutors said Blankenbaker ran the fraud scheme from August 2016 to May 2019 through StarGrower Commercial Bridge Loan Fund 1 LLC, StarGrower Asset Management LLC and Blankenbaker Investments Fund 17 LLC.
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