A Missouri company that at one time helped patients acquire medical marijuana cards is being forced to repay some of the money it took from investors.
Missouri Secretary of State Jay Ashcroft’s office announced Wednesday that its Securities Division issued a consent order against Green Clinic, LLC, after the company sold $520,000 in unregistered, non-exempt securities, in violation of state law.
The securities were sold in the form of investment contracts with eight Missouri residents and eight out-of-state investors, according to a copy of the consent order obtained by the News-Leader.
Investors from Kansas, South Carolina, Tennessee and Texas made up the lion’s share of investments in the medical marijuana card clinic, totaling $400,000, the consent order states.
Under the consent order, the company must repay $52,000 in gradual payments through Jan. 2, 2023. A $15,000 civil penalty will be waived “if the company principal complies with the restitution payment schedule,” the Securities Division said. The order says Green Clinic consented to Missouri Securities Commissioner David Minnick’s findings and agreed to reimburse a portion of the investors’ losses.
As the News-Leader reported earlier, Green Clinic formed around the time of the 2018 election cycle, when a majority of Missouri voters authorized a constitutional amendment, Article 14, establishing a state medical marijuana program in defiance of federal prohibition.
Green Clinic sold appointments to patients so they could obtain the physician recommendation paperwork needed to get a state-issued medical marijuana ID card. As the News-Leader reported, it claimed to be the first of its kind in Missouri. Green Clinic attempted to charge $299 per evaluation for most patients in mid-2019, as state cannabis regulators began to accept applications from members of the public who wanted medical marijuana cards.
By late 2020, most such clinics in southwest Missouri charged new patients just $100 to $200 per evaluation for a medical marijuana card, as the News-Leader reported. Unlike cannabis dispensaries, commercial cultivators or manufacturers, a marijuana card clinic is not required to obtain a state license to do business in Missouri.
Ashcroft’s office said Wednesday that from November 2018 through Nov. 2019, Green Clinic sold the investment contracts to investors in the Kansas City and Poplar Bluff areas, as well as out of state.
The company, registered to owner Emily Branch in state records, abruptly announced its closing in December 2019, blaming its business woes on the state health department and “other providers” of marijuana cards.
When Green Clinic closed, investors faced “significant losses,” Ashcroft’s office said Wednesday.
Branch could not be reached for comment Wednesday after four attempts by the News-Leader.
Securities Commissioner Minnick said in a written statement, “Fledgling businesses, like those permitted by the Missouri Medical Marijuana Program, can be high-risk ventures, and investors can lose everything they invest. Before writing the check, check out the company and the people seeking your hard-earned money.”
Ashcroft’s office urged Missouri investors to find more information or file complaints by calling a toll-free investor protection hotline, 800-721-7996, or visiting missouriprotectsinvestors.com.
Reach News-Leader reporter Gregory Holman, who has been covering Missouri marijuana news since voters authorized a medical cannabis program in 2018, by emailing gholman@gannett.com. Please consider subscribing to support vital local journalism.
