Spain’s National Court has opened a lawsuit against crowdfunding platform JuicyFields following its collapse in July which saw investors collectively lose out on millions of dollars.
Investors were left out of pocket after JuicyFields left “eGrowers” across the world unable to access assets they held on the company’s site in July.
According to reports, Spain’s National court has now opened a case against the company, based in the Netherlands, as of September 15. The reports state that the court intends to “identify those allegedly responsible for the crimes”, as well as to understand the company’s financial dynamics.
Read more: Juicy Fields fraud controversy – company claims it will refund investors
Banking, financial law and cryptocurrency experts, The Martínez-Blanco Abogados law firm, filed a collective lawsuit against JuicyFields, representing Spanish citizens that were allegedly defrauded by the company. Martínez-Blanco Abogados has claimed that those affected saw an average loss of €6,500 each.
In a statement on its website the firm commented: “The scam that has trapped thousands of minor investors, offered high returns by offering those affected the possibility of “buying” cannabis plants, which JuicyFields proceeded to harvest for medicinal distribution, promising to return the money invested plus an extra benefit of between 29% and 66% additional.
Read more: Opinion – former Juicy Fields CEO shares his thoughts on the case
“This system has been working for the last few years, but it seems to be uncovering that the plantations could have been fictitious.” [Translated from Google]
It went on to state: “It is estimated that the money allegedly defrauded according to the data offered by these wallets exceeds 900 million euros, with 8,500 people affected in Spain. Approximately 30% of those affected by JuicyFields worldwide are Spanish.”
In July, Germany’s Federal Financial Supervisory Authority (BaFin) prohibited Juicy Holdings B.V. from offering capital investments in the form of investments in cannabis plants to the public due to a violation of the German Capital Investment Act. JuicyFields failed to provide a required prospectus and remove its products from sale, subsequently receiving a fine of €1m from BaFin. This was shortly followed by the shutdown of the JuicyFields access platform for its investors.
Following the company’s establishment in 2020, the platform was hailed as an “innovative” approach to crowdfunding for cannabis, with the company offering investors the opportunity to become a “potpreneur and benefit from the booming cannabis industry”.
Under its model, “eGrowers” were able buy a “plant category” from JuicyFields which would then buy a plant from one of its alleged partners, which would sell the final THC product to a third party and the profit would be distributed among the partner, JuicyFields and the eGrower.
JuicyFields had promised its investors returns on their investments in as little as 108 days after funds were received and, whilst many received profits from their investments early on, once the firm collapsed, many investors questioned whether JuicyFields had planted any cannabis at all.
The company’s most recent update to its investors claimed it has put a plan into action to generate income with its own money “with a view on at least repaying all the existing investors who have money tied up in the bank accounts.”
Its website goes on to state: “This plan will most certainly allow us to refund everyone over the course of the next year. If however the investigations that are currently being conducted by the authorities clears us and allows us to gain access to your monies that are currently frozen, it will speed up the new business plan and the refund time-frame.”
It also claims that it is working with “reputable financial institutions” on a second version of its platform to “allow for a far more transparent platform interaction.”