318 Billion Rubles Invested in the Largest Cannabis Scam

JuicyFields, a platform launched in 2019 for earning money through cannabis cultivation, was recently declared a financial pyramid scheme. This platform became the largest cannabis-related scam in history, with investments totaling 318 billion rubles. Over 500,000 people fell victim to the fraud.

On July 11, JuicyFields froze withdrawals on its website and deleted content from social media and YouTube. Clients lost access to their investments and realized they had been deceived. Legal experts analyzed the company’s business model and classified it as a Ponzi scheme that imitated profitable investments.

Experts determined that, over the platform’s operation, digital assets worth more than 5 billion euros (318 billion rubles) were transferred to JuicyFields’ cryptocurrency wallet. The number of victims reached 500,000, with about 28,000 people in Spain alone investing in the project. Each victim lost between 50,000 and 180,000 euros (from 3.1 to 11.5 million rubles).

How the Scam Attracted So Many Investors

The criminals managed to attract such a large number of people for several reasons:

• First, the company paid dividends to early investors, who made significant profits.
• Second, JuicyFields signed partnership agreements with legitimate cannabis businesses, which began cultivating cannabis with funding from JuicyFields’ clients.
• Third, the scammers ran a well-organized advertising campaign, hosting meetings with potential investors, offering free food and drinks, showcasing expensive cars with the JuicyFields logo, and hiring attractive models.

Legal Actions and Company Ownership

JuicyFields founder Alan Glanz resigned earlier in the year, claiming he had no involvement in the platform’s exit scam. CEO Willem van der Merwe stepped down in mid-July and refused to speak with journalists. However, German publication Finanztest discovered that JuicyFields was owned by the Swiss holding company JuicyFields AG, previously known as Luxburg Carolath Holding AG until 2021. This organization is managed by members of the German aristocratic von Luxburg family and Duke Jörg Wolfgang of Saxony.

Alan Glanz, however, claims that the real owners were three Russian citizens: Pavel Bergoltz, Alexander Weimer, and Vasily Kandinsky. Attorney Robert Laibach represented Alexander and Vasily. According to leaked documents, these individuals owned all shares of the German and Swiss JuicyFields companies. Glanz said he was hired as CEO and met with them five times over two years.

The Berlin prosecutor’s office is investigating the German department of Juicy Grow GmbH, and Germany’s Federal Financial Supervisory Authority has already fined the company 1 million euros (63.7 million rubles). On July 31, investors from Luxembourg and Belgium planned to file a class-action lawsuit against JuicyFields. Victims from other countries have not yet announced their plans. Meanwhile, remaining company employees are forming a fund to return money and promise to compensate investors for at least part of their losses.

How JuicyFields Operated and Why It Failed

JuicyFields launched the world’s first cannabis crowdfunding platform, offering anyone the chance to invest in cannabis cultivation by purchasing plants for 2,000 euros (115,740 rubles) each. Over three years, each plant was supposed to generate income of 3,600 to 4,800 euros (208,332 to 277,776 rubles), promising users at least an 80% profit. For testing, users could buy a cannabis plant for 50 euros (2,895 rubles), which would yield a profit of 17.5 to 32.5 euros (1,013–1,881 rubles) after 108 days.

To build trust, JuicyFields signed agreements with licensed cannabis companies in Denmark, Lesotho, Portugal, South Africa, and Colombia. In the third quarter of 2021, partners cultivated cannabis on 5.6 hectares and produced 37 tons of marijuana, allowing investors to receive their dividends on time.

However, some media outlets expressed doubts about JuicyFields’ reliability due to the overly favorable terms, and unfortunately, these concerns were justified. The company began facing problems this year. In March, Germany’s Federal Financial Supervisory Authority announced that JuicyFields was illegally soliciting investments, forcing the startup to stop serving German clients. In May, Spanish authorities stated that the platform violated securities laws and banned it from receiving investments from Spanish residents.

Impact on Investors and Ongoing Efforts for Compensation

After the scandal broke, CEO Alan Glanz resigned to avoid responsibility. In July, the new management disabled the withdrawal option, preventing clients from accessing their assets. Tens of thousands of people in Spain, Germany, the UK, the Netherlands, France, Colombia, and the US lost money. At least 5,000 Spaniards lost their savings, and JuicyFields was labeled the largest crypto scam in Spanish history.

According to the JuicyFields website, the company owes clients and partners about 12 million euros (694 million rubles). Allegedly, honest employees have created a fund to compensate investors. To receive compensation, users must send JuicyFields:

• A video showing the investor’s documents and stating the amount of loss
• Scans of various documents, including a passport and a utility bill

Company employees will form a group of volunteer rescuers from among platform users to verify victims’ data and add them to the compensation list. JuicyFields staff noted that they would only reimburse the cost of one purchased cannabis plant, meaning each investor could expect a payout of either 50 or 2,000 euros, depending on the plant’s strain. The staff also plans to organize pickets at company offices and executives’ homes to draw public attention to the issue.