Despite a prevalent legal cannabis industry, black market pot sales are still going on. So much so, that even state-licensed, legal operations, can sometimes venture out into the old marijuana “business model.” This notion was once again proven after an extensive investigation, where an Oregon Dispensary was raided over alleged credit card fraud financing, linking it to a sizeable black market operation.
Oregon Dispensary Raided Over Alleged Credit Card Fraud Financing
According to the U.S. Department of Justice, nine people in the Corvallis-area are facing conspiracy charges. A year-and-a-half federal investigation into a convoluted credit card fraud scheme determined that the money was being siphoned off into illegal marijuana grows. More specifically, a state-licensed marijuana retail business, which shipped marijuana over state lines.
According to prosecutors, the FBI and USPS began investigating the issue back in December of 2016. Court documents show that the illicit scheme resulted in over $1 million in bank losses.
The “bust out” fraud scheme allegedly targeted struggling Armenians. In a typical “bust out” scheme, offenders acquire credit cards with rapidly-accumulating large balances. Then, an accomplice makes payments from a separate bank account, which reduces the balance enough to make several other purchases. Once the purchases are made, the accomplice simply says that the payments made from their account were unauthorized, which results in banks re-imbursing the conspirer’s account. Once the scam is finished, no further charges are made on the card.
In this particular case, it has been alleged that the nine people charged opened up several different credit cards for the scheme, according to criminal investigators. Synchrony Bank, for example, reported a $171,808 loss from the use of eight fake credit cards issued by a Ukraine woman named “Yana K.” Other banks, including, Capital One, Chase, Citibank, Comenity, Discover, U.S. Bank, Bank of America, Wells Fargo, and Oregon State Credit Union, reported similar occurrences.
The Green Scheme
The proceeds of the illegal scheme allegedly went towards an illegal marijuana grow operation, as well well as funding a legitimate, state-licensed marijuana retail dispensary, the Corvallis Cannabis Club. It was there that the perpetrators packaged illegally-grown marijuana to sell out-of-state.
According to Oregonian, some of the cards were also used to buy items, and sell them at half price, including cigarettes, gold jewelry, and furniture. There was also a $33,000 charge racked up at the Spirit Mountain Casino.
The nine charged include, Issa J. Barsha, Akmaljon Radjapov, Yeghishe Nazaryan, Mariam Gevorkova, Ararat Manukyan, Lilit Gevorkova, Shokhrukh Tashpulatov, Davit Sukiasyanand and Georg Tashchyan. The group is accused of conspiracy to commit mail fraud, bank fraud and wire fraud and manufacture, and the distribution or possession of marijuana.