Cannabis Firm Founders Accused of Misappropriating $14M

The founders of Green Relief Inc., a Canadian cannabis firm, have been accused of misappropriating about $14 million from the company for personal use.

Full story after the jump.

The founders of Canadian licensed producer Green Relief Inc. are accused of misappropriating about $14 million from the company for personal use over the course of six years, the Financial Post reports. The allegations came during a private shareholders’ meeting last month which was recorded and sent to the post.

In the video, company executives detail transactions they believe were made by the founders – Warren and Lyn Bravo – which have led to financial distress for the firm. In the video, filmed in January, Green Relief’s current Chief Executive Dr. Neilank Jha suggested the company only had enough funds to survive until February; however, he told the Post the firm was still liquid and would be for the “next few months.”

Jha succeeded Warren Bravo in March 2019 after Bravo stepped down as CEO that February.

“As CEO, my goal is not to seek justice. My goal is not to worry about what people have done in the past. My goal is to advance Green Relief and protect your investments.” – Jha, during a January 14, 2020 stockholder’s meeting, via the Post

An internal investigation by Green Relief found that since 2013 the company had received $59.2 million in funding from, primarily, shareholders and had spent $45.1 million for long and short-term expenses — a discrepancy of $14.1 million.

In an email to the Post, Jha, whose company Bodhi Research & Development was acquired by Green Relief in early 2019, said he was told that $200,000 in funds had been misappropriated on his first day and that he once wired the company $150,000 of his own money to keep it afloat.

In the video, Chief Financial Officer Stephen Massel alleged that the Bravos used fake invoices and billed Green Relief. They accuse the couple of using $1.3 million for the construction of a private home and discharging the mortgage on a property owned by Lyn, using $900,000 for credit card bills and leasing vehicles and another $2.9 million for personal investments, and spending $3.7 million to support their other businesses.

In an email to the Post, the Bravos’ lawyer John Hammond said they “vehemently deny” the allegations, describing them as “false, without merit, and constitute a malicious defamation” against the Bravos. In court documents related to an attempt by Green Relief to bar Lyn from the property, she claims that the funds for the mortgage were used “at the express request and direction of Green Relief, and with the full knowledge of its shareholders, directors and officers,” the report says, and that the new home was an “integral part of Green Relief’s plan for future offices” and was done with the company’s knowledge and support. She claims she is still owed some $100,000 she loaned the company to cover payroll in 2018.

Green Relief received significant media attention in late 2018 and early 2019 for using a pesticide-free process in an underground aquaponic farm to grow cannabis. Aquaponics is a process that uses aquatic animals and hydroponics to grow plants.

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