Rapper BigRigBaby's WeedGenics Company Was A Ponzi Scheme

Sit back and listen to a story where rapper BigRigBaby (Patrick Earl Williams) and his partner Max Bergmann (Rolf Hirschmann) steal millions of dollars of investor money from their “WeedGenics” company. This is eCrimeBytes.com S 2 Ep 6-4: Rapper BigRigBaby’s WeedGenics Company Was A Ponzi Scheme – Act 4: The Ponzi Scheme.

For the background, please check out our prior acts:

Rapper BigRigBaby’s WeedGenics Company Was A Ponzi Scheme – Act 1: Meet The Playas

Rapper BigRigBaby’s WeedGenics Company Was A Ponzi Scheme – Act 2: Green Investments

Rapper BigRigBaby’s WeedGenics Company Was A Ponzi Scheme – Act 3: The High Life

Sources:

Transcript:

00:00:10:00 – 00:00:39:00
Keith
Hey, welcome back to eCrimeBytes Season two, Episode six. This is the rapper BigRigBaby, his company. WeedGenics ends up being a Ponzi scheme and we in acts one through three built you up. Explained who BigRigBaby was. He’s a rapper and also a vice president of this company named WeedGenics that’s expanding in California and Nevada.

00:00:39:03 – 00:00:54:13
Keith
They need investors. They put out a bunch of investor material and they’ve gotten investors who’ve sunk, you’re going to find when we tell you here in a minute, a lot of money, we’re talking millions of dollars into this company.

00:00:54:13 – 00:00:58:17
Keith
We talked at great length about all this revenue that they are producing and

00:00:58:17 – 00:01:02:11
Keith
the quarter million square feet of space here and there.

00:01:02:13 – 00:01:22:05
Keith
But at the last act, we said of this shit was real. So all of this stuff was fake. All of this evidence, this electronic evidence that they put together and all these PowerPoints, spreadsheets and emails and all of all this stuff is fake. This is actually a Ponzi scheme. And this is the act where we’re going to talk about it.

00:01:22:05 – 00:01:34:09
Keith
So just getting in there, once you knew that this the facilities didn’t exist, you knew that there were a ton of lies just right off the bat. So all the times that they said we had all the facilities,

00:01:34:09 – 00:01:45:11
Keith
licenses and permits and certifications and all that stuff, that you need A to operate as a business, but B operate in a business that deals in narcotics.

00:01:45:14 – 00:02:08:25
Keith
They said they had all that. Well, they didn’t because they didn’t have any of that property. So that right there is an issue. So what I want to do is I gave you a little bit of a spoiler and I said, hey, none of these facilities are real. But in the timeline of evidence that we’ve given you, the victims don’t yet know this.

00:02:08:25 – 00:02:26:21
Keith
So keep that in your mind as we talk about this, because what might seem obvious to us now that we know that this these facilities aren’t real wouldn’t be obvious to the these people that have gotten all these pictures. And some of them get tours of these fictitious places.

00:02:26:21 – 00:02:30:29
Keith
So this is where the hard shift happens, is the fall of 2022.

00:02:30:29 – 00:02:45:13
Keith
And I’m going to let Seth take this. This is where some restructuring happened in my I said this in the last act, but this is in my thought process. This is where they started going, Oh, shit, we’re running out of money. And I might have something differently.

00:02:45:15 – 00:03:16:19
Seth
So the court documents indicate that sometime in September and October of 2022, INR underwent a restructuring and they unilaterally changed the terms of the investor agreement. So what does that mean? That means they didn’t get any kind of feedback from a board or the actual shareholders. They just said we’re changing stuff. So instead of INR paying investors fixed interest payments on principal investments monthly, as promised, defendants told investors to choose between a gradual return of only principal.

00:03:16:21 – 00:03:50:03
Seth
Meaning you give me a hundred grand, I’ll pay it back over time, or a conversion to some fictitious, quote, preferred stock in the company. So what does that really mean here? So let’s talk about Alexandra Bovee, also known as Aia Montgomery. So Bovee contacted investors about restructuring their investments. Apparently well specifically Bovee noted that INR was, quote, going through major changes and that investor payments would also undergo changes as a result.

00:03:50:03 – 00:03:52:26
Seth
So well I’m assuming she represented INR

00:03:52:26 – 00:04:08:28
Seth
eventually clarified to investors that they had two options. They can convert their debt positions with INR into preferred stock equity positions for which they would no longer receive monthly interest payments or reach some sort of withdrawal arrangement from INR.

00:04:08:28 – 00:04:26:15
Seth
So we learned that Hirschmann personally reassured investors that Bovee’s comments about restructuring were, quote, valid and confirmed for them that she was the point of contact for the executive team and INR legal department, because if you’re asking who the hell is she?

00:04:26:15 – 00:04:38:12
Seth
I was thinking the same thing when I read the facts. But Bovee indicated to investors that the restructuring was necessary because INR was in the early stages of going public. So what does that mean.

00:04:38:15 – 00:04:46:27
Keith
To, as you say, that’s how they tried to cover up this restructuring, which I thought was very it was a very clever move, you know.

00:04:46:29 – 00:04:59:26
Seth
Right. I keep in mind, like if you’re an investor in like a private entity and you find out that they’re going public, that’s usually music to your ears, right? Because it usually bumps up the value of the stock. So that’s kind of how people become insta millionaires, at least in theory.

00:05:00:19 – 00:05:25:00
Seth
So on September 28th, 2022, INR did file a Form D with the Securities and Exchange Commission indicating that it was offering now 60 million in equity pursuant to an exemption from registration under Rule 506. Basically, they were now engaging the SEC to say, Hey, we’re a thing, we’re actually going to be offering securities and. Of course, if you do that, the United States, you have to go through a certain process here.

00:05:25:00 – 00:05:27:02
Seth
It would be form D.

00:05:27:04 – 00:05:30:03
Keith
That’s a hell of a fucking bluff for a Ponzi scheme, man.

00:05:30:06 – 00:05:32:14
Seth
That’s a hell of a bluff.

00:05:32:16 – 00:05:34:16
Keith
Hell of a bluff.

00:05:34:18 – 00:06:06:28
Seth
So what happens if investors start to complain? So the court documents note that when investors who were told about the restructuring notified Bovee that they had not received interest payments for many months and wanted a return of their principal, but we know INR’s response would be very complicated No. Instead, INR thought INR rather through Bovee and other is offered investors who did not want to convert their debt positions into preferred stock a gradual return of their principal over many years.

00:06:07:00 – 00:06:26:28
Seth
It’s like, Oh, you gave us a hundred grand, we’ll pay that back some. INR also hired an attorney who communicated and negotiated with investors about such withdrawal arrangements. Now, I’m going to pause here. If you’re the attorney and you did an ounce of due diligence on this company, you would have not taken that legal work. I am not representing a company.

00:06:26:28 – 00:06:38:19
Seth
That’s bullshit. So that guy might have committed malpractice in even taking that job. Some investors agreed to this withdrawal agreement. Which agreement was signed by guess who BigRigBaby as their vice president.

00:06:38:19 – 00:06:39:11
Keith
So. Okay,

00:06:39:11 – 00:07:03:18
Keith
I’ve shielded you from a lot of just complicated financial bullshit behind the scenes here of how they got away with a lot of this because it wasn’t just as simple as Seth and I are presenting it to you with people just getting money because the investigation on this would be so, so simple and it’d be done and over. What they did is they have a bunch of companies registered to a bunch of different people.

00:07:03:21 – 00:07:30:24
Keith
The main people are still it’s BigRigBaby and Max Bergmann behind INR, which is WeedGenics, which is this whole investment scheme. These other defendants, they call them relief defendants, which may or may not get charged. But basically they they received gains from this whole scheme. So they’re named here. And there’s some that I’m pretty sure are going to get charged criminally

00:07:30:24 – 00:07:35:29
Keith
by the way they’re talking about them in the paperwork. And then there’s some that I think are probably going to be questionable.

00:07:35:29 – 00:07:52:03
Keith
Now, I tried to shield you from most of this, and I’m just going to give you some broad strokes. But there’s this table in the court paperwork where they have the recipients of the Ponzi scheme are basically the criminals in this case or who who received gains from it.

00:07:52:06 – 00:08:11:02
Keith
One of them is BigRigBaby up at the top. And they talk about his entities and he’s got a whole bunch of companies below him that basically when money would come in as investments, would get filtered through a bunch of places and you’re probably you’re your mind’s probably blown to this point. You’re going, what does he mean?

00:08:11:05 – 00:08:18:18
Keith
I’m telling you, this is so goddamn complicated. Let me show you an example here. I’ll stop for our video viewers and show you

00:08:18:18 – 00:08:33:04
Keith
this is how the companies worked when they sent money. So you can see if you’re on the video side. This probably I probably gander 15 to 20 boxes on here. Each one is a different company.

00:08:33:07 – 00:09:00:29
Keith
And any time money would come in, money would get shuffled around all these companies. It would just make it very difficult for some kind of forensic accountant to come in and figure out what the hell happened. And it kind of doing this, this complexity allows the scheme to go a little further. But because of this complexity, it makes a case like this very difficult to bring you because there’s so many people involved with it.

00:09:01:01 – 00:09:02:27
Keith
So I’m just well, I gave you some broad.

00:09:02:29 – 00:09:12:23
Seth
Yes. But I think with all that being said, the court document has a fantastic job of kind of laying it out there. And I don’t want to steal your thunder, Jones let you present it, but basically,

00:09:12:23 – 00:09:20:27
Seth
that the two main dudes so you have Williams and I guess assumedly Hirschmann burg. Bergmann All right. How much money do they get?

00:09:20:29 – 00:09:28:06
Seth
How much money do they take for themselves and how much do they actually use to keep the Ponzi scheme alive? Because for me that’s kind of the end of the day,

00:09:28:06 – 00:09:31:02
Seth
what happened here and it’s fantastic.

00:09:31:04 – 00:10:09:23
Keith
So Bigrigbaby, he walked off with 19.2 million from investors and Max Bergman walked away with 22.9 million from investors. And then there’s this other relief defendant, Delgado. His companies walked away with 7.2 million, and there’s another one called Relief defendant Campbell and his string of companies below him. They totaled out at 9.1 million. And then if you remember Alexandra Bovee or what was it Aia Montgomery was her.

00:10:09:23 – 00:10:14:23
Seth
Aia Montgomery was her secret agent name. She was the Investor Relations relations person.

00:10:14:25 – 00:10:37:16
Keith
Well, I imagine they probably found the most attractive woman they could put in the most uncomfortable position of having to restructure these agreements of the investors. Guess she walked away with $715,000 for her work, which I don’t know if that’s a lot or not, because I imagine some pretty pissed off investors that she had to talk to you.

00:10:37:19 – 00:10:55:12
Seth
Yeah, but I think it’s worth kind of going through Jones Go back a slide or forward a slide of I think we can we just talk about the two main people about how much money was given to them from the investors versus what did they do with the money because I think that’s really worth going through.

00:10:55:14 – 00:11:17:12
Keith
Yeah, we are going to address that Act five, which is actually coming up where we’re going to go through that. I can’t wait. I can’t wait. What they have with their money and what they end up spending their money. And one thing I did forget to mention here is there’s one last bullet item here of an expenditure, and this is $16.1 million.

00:11:17:15 – 00:11:44:05
Keith
Now, if you remember, I can’t remember which act it was in, but I told you about a Ponzi scheme. A good Ponzi scheme usually pays off early investors. So that way later investors go, Hey, those guys are making money. I’m going to put money here, too. Well, this $16.1 million they used to pay off earlier investors and interest payments and everything they needed to pay off in order to keep the scheme going and going and going.

00:11:44:08 – 00:11:49:28
Keith
So with that Act four is over, we’ve introduced you to the Ponzi scheme,

00:11:49:28 – 00:11:56:16
Keith
Act five, which is tomorrow Friday. We’re going to talk about the pyramid crumbles. We’re going to talk about where they spent their money.

00:11:56:16 – 00:12:10:08
Keith
what is coming out of this case and maybe Seth and my predictions on what happens after this case is over. So if you liked anything in this act, please like and subscribe whatever application that you’re on.

00:12:10:08 – 00:12:31:08
Keith
But if you’re on Apple Podcasts for our audio only listeners, we could use a five star review there because that helps push up some charts and new users then find us. And that’s what we’re looking for here. So if you could do this that favor, we really appreciate it. And if you haven’t, visit our website. Please do is just ecrimebytes e

00:12:31:11 – 00:13:07:26
Keith
c r i m e b y as in yellow milk t e s dot com and all our social media links are up across the top there. If you are on your phone click that little hamburger looking button up there and you’ll see all our social media links for you on your phone too. And with that, I cannot wait for act five because we’re going to put a cap on the end of this just absolutely insane case of them convincing investors that they had these two gigantic growth facilities in order to make millions of dollars in fraud.

00:13:07:26 – 00:13:13:02
Keith
So I hope to see you back tomorrow in Act five, the pyramid crumbles.

00:13:13:04 – 00:13:16:11
Seth
Thanks

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DrKeithJones.com

Rapper BigRigBaby’s WeedGenics Company Was A Ponzi Scheme – Act 4: The Ponzi Scheme

Sources:

Transcript:

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