Cannabis crowdfunding platform Juicy Fields collapsed earlier this month, siphoning millions in investments from its crypto wallet. The company has now released a statement saying it intends to refund investors.
Investors are currently millions out of pocket after Juicy Fields left “eGrowers” across the world unable to access assets they held on the company’s site.
Earlier in July, Germany’s Federal Financial Supervisory Authority (BaFin) prohibited Juicy Holdings B.V. from offering capital investments in the form of investments in cannabis plants to the public due to a violation of the German Capital Investment Act. Juicy Fields failed to provide a required prospectus and remove its products from sale, subsequently receiving a fine of €1m from BaFin.
A number of Juicy Fields’ staff went on strike after failing to receive wages, leading to investors – who paid their investments in either fiat or the cryptocurrencies Bitcoin, Ethereum or Tether – attempting to recover their funds, only to find they were blocked out of their accounts. In a letter seen by Cannabis Wealth, former CEO, Willen van der Merwe, claims that suggested technical changes led to the shut down of the site, which could be back up and running by August.
Former employees, including Daniel Guaci, who says he has received death threats over the situation, have been dissociating themselves from the company. Others who were identified on the Juicy Fields website as team members, including Thomas Steiger, Stefan Graf van Luxburg, Birgit-Elisabeth Neumann and Dr Robert Muller, have threatened to take legal action against the company.
It is currently not clear who is heading the company, however, leaked documents allege three men with Russian passports, Paul Bergolts, Vasily Kandinksi and Alex Vaimer, are the owners.
All of Juicy Fields’ social media accounts and official Telegram channels have been deleted, however, other unofficial Juicy Fields channels have been established by investors discussing the matter. One investor has claimed that the company has ruined families and changed lives, whilst another has rumoured that an individual had taken their life after losing access to their assets.
The Juicy Fields eGrowers are now organising to launch a collective lawsuit against the company and have created a petition demanding communications from the Juicy Fields team.
Juicy Fields yesterday released a statement claiming the company is initiating a process to refund investors.
The company has stated that it was approached by a man named Frederich Graf von Luxburg who “presented an elaborate proposal to not only deal with the BaFin situation that the company faced but to also assist us with the preparation of a prospectus as per BaFin requirements in order for Juicy Fields to become compliant with regulatory guidelines in Germany.”
According to the founders, Graf von Luxburg charged Juicy Fields between €100,000 and €300,000 per month for his legal services, stating that it would be necessary to register Juicy Fields in the Netherlands, which he did, under the name Juicy Holdings B.V..
Dr Robert Muller was appointed as the single director and board member of this company, allege the Juicy Fields team, who say they were never added to the list of directors and board members.
The founders stated: “Von Luxburg then proceeded to change the name of one of his own Swiss-registered companies to Juicy Fields AG for the purpose of holding 100 per cent of the shares of the Netherlands Juicy Fields company in the name of this Swiss company. In the Swiss company, von Luxburg appointed his younger brother Stefan Graf von Luxburg and the same Dr Muller who was acting as sole director and board member of the Netherlands company, as the only two board members and directors of Juicy Fields AG in Switzerland.
“This was clearly, in hindsight, a deliberate action by von Luxburg, to structure a takeover of the Juicy Fields platform from its founders and developers, who had started the business originally in Germany. All of this information is in public records and can be verified with company house both in the Netherlands and in Switzerland.”
The team claims that von Luxburg attempted to take over the company bank accounts in Cyprus without the knowledge or consent of the founders of the Juicy Fields platform, leading to the decision to freeze all operations.
The team stated: “The decision to suspend all business activities has unfortunately damaged the reputation of Juicy Fields immensely, especially due to the fact that a lot of speculation that the company has been running a Ponzi scheme has done the rounds.
“This is extremely far removed from the truth. For two years, Juicy Fields has operated properly and our clients, eGrowers and financial service providers have never had reason to complain about our performance on our business. We have also only used properly licensed financial institutions through which to conduct the Juicy Fields business operations.
“The attempts by von Luxburg to illegally take control of the accounts at these financial institutions has obviously caused these financial institutions to suspend all of our operating accounts. We are currently cooperating fully with these financial institutions.
“The problem with having to request financial institutions to suspend and freeze monies in our accounts as a method to safeguard against third party theft, is that our business operations are also immobilised. In all cases where a financial institution has suspended or frozen an account, the financial institution is obligated to notify the financial intelligence unit (FIU) of its member state and these accounts can only be unfrozen once the FIU has concluded their investigations.”
Juicy Fields has stated that the company will now begin a formal process to refund capital investments to all affected eGrowers who have legally invested funds with Juicy Fields, stating that information on this process will soon be released.
Additionally, Juicy Fields has stated it still has the option to launch in September, with its planned new platform, and to offer existing eGrowers the opportunity to continue doing business under the new platform.
According to the statement, further information will be expected throughout August.