A rapper known as BigRigBaby and his business partner have been charged by federal regulators with running a “Ponzi-like scheme” to raise nearly $62 million from investors in a fictitious cannabis company.
Patrick Earl Williams, 34, and Rolf Max Hirschmann, 52, were charged in a civil complaint filed this week by the Securities and Exchange Commission.
According to the complaint, Williams, better known online as BigRigBaby, and Hirschmann defrauded investors in a bogus pot-growing operation and spent much of the money on ‘payments to women’ and personal expenses. such as luxury cars, jewelry and adult entertainment. .
The duo “allegedly had no real business, product or company, but despite that, they promised investors everything and then delivered nothing,” said Michele Wein Layne, director of the Los Angeles regional office of the SEC, in a statement.
The SEC has obtained an emergency order ending the alleged “pending bid fraud and Ponzi scheme” of Integrated National Resources Inc, which does business as WeedGenics.
Patrick Earl Williams, aka BigRigBaby, is seen with a late model Corvette. Williams and his business partner have been accused by federal regulators of running a ‘Ponzi scheme’
WeedGenics described itself as a “vertically integrated” manufacturer of cannabis products
“This action demonstrates that, despite the defendants’ extensive efforts to avoid detection, the SEC has the ability to uncover fraud to protect investors,” Layne said.
Attempts to reach Williams and Hirschmann through WeedGenics were unsuccessful, and court records did not indicate an attorney representing the duo.
Since at least June 2019, Hirschmann and Williams have promised investors returns of up to 36% on funds they believe will go towards expanding WeedGenics cultivation facilities in California and Nevada, the SEC said in a statement. criminal record.
“In truth, however, it was all a sham,” the filing added.
The SEC said the pair spent about $16 million of investors’ money to make payments to other investors, reinforcing the illusion that their business was generating revenue.
Williams received about $8 million in funds from investors, of which about $625,000 was spent on meals, jewelry, adult entertainment and other personal expenses, according to the complaint.
Williams received about $8 million in investor funds, of which about $625,000 was spent on meals, jewelry, adult entertainment and other personal expenses, the SEC said.
The complaint included this breakdown of how Williams and Hirschmann allegedly spent investor funds
Williams spent more than $18,000 promoting her music career as BigRigBaby, SEC says
Williams, who lives in Florida, has also spent more than $18,000 promoting her music career as BigRigBaby, including payments to producers, DJs and iHeartMedia, according to the SEC.
Additionally, approximately $1,976,000 of the investors’ funds were transferred to Williams’ personal bank accounts or withdrawn in cash, according to the complaint.
Hirschmann lives in Idaho and went by the fake name “Max Bergmann” while communicating with potential investors, according to regulators.
Hirschmann and his entities received about $15,673,000 in funds from investors, of which about $4.8 million was spent on real estate and $2.4 million was spent on luxury cars, according to the filing.
It also used about $3.2 million of investor funds to make credit card payments, and $913,000 was withdrawn in cash, the SEC said.
WeedGenics described itself as a “vertically integrated” manufacturer of cannabis products on its website.
The website claims the company has a 52,000 square foot “grow campus” in Las Vegas and is undergoing a “massive expansion” with a new grow facility in Adelanto, California.
In reality, according to the SEC, none of the facilities were real and the company produced nothing.
A hearing in the case is scheduled for June 2 to determine whether to issue a preliminary injunction and appoint a permanent receiver.