A Maltese cannabis entrepreneur dubbed the “gentleman smoker” and the “high priest of weed” has disassociated himself from his former venture after it was accused of being a Ponzi scheme.
“I don’t have all the answers to the current situation either so I cannot dwell on it too much and hope that everything comes to light so that all loose ends can be tied up and the appropriate responsibilities against those who have acted outside the scope of legality will be cleared up,” Daniel Gauci said in an open letter on LinkedIn to aggrieved investors.
“The reason I left my job at the company is based on the lack of understanding and disagreement with superior positions and management, as well as repeated broken promises that prevented me from carrying out my duties, since I was just another worker like many of the people affected.”
“I am not a shareholder, owner of anything similar, simply another employee who, like many of you, have been affected as well as confused, which is why we are interested in clearing up all doubts as soon as possible.”
He condemned threats that have been aired towards himself and his family, stating that they have forced him to remain offline and that he will now only be reachable via his lawyers “for our safety”.
“I understand the anger, frustration and rage that many affected may harbour, however I will not tolerate such serious threats towards myself or my family as those already received and in case of recurrence I will adopt the necessary legal measures against those who exceed the limits,” Gauci said. “Everything must be channelled and directed in the correct way to find a solution and purge the responsibilities of the guilty parties through legal channels.”
Gauci was Chief Business Development Officer of Juicy Fields, a company that encouraged people to invest money in medical cannabis plants to be grown at greenhouses around the world.
The scheme worked by encouraging people (who they cheekily referred to as “e-growers” or “potpreneurs”) to select the strain and amount of cannabis they would like to grow, with different packages per strain.
JuicyFields would then order the plant from its global cannabis growing partners, which it said were located around the world, from Colombia and Portugal to Germany and South Africa.
Once the time came to harvest the cannabis, the partner would sell it to a third party, with the profit distributed between the partner, JuicyFields and the e-grower.
The scheme was pitched as an easy way for people to tap into the emerging global medical cannabis market without having to go through the hassle of acquiring finances, real estate and licenses. People were promised a high-yield of between 6% and 14% in what was portrayed as a safe investment, with JuicyFields arguing that investors didn’t have to worry about market fluctuations.
“Crowdgrowing income isn’t dependent on general conditions of the industry or the overall financial markets. The expected income of every e-grower’s harvest is shown at the time of sale,” a JuicyFields information document reads.
Juicy Fields claimed to be based in Amsterdam and to have other offices in Germany, Spain, Switzerland and Portugal. Although it was never based in Malta, it did have a presence on the island.
Gauci was based in Malta, where he would film cannabis-related YouTube videos with a stunning backdrop of Valletta, and two other Juicy Fields officials appear to have been based here for a while too.
In 2021, Gauci was featured in a MaltaToday video, in which he promoted Juicy Fields as a way of removing entry barriers for budding cannabis entrepreneurs. He also appeared enthusiastic about the plant itself, claiming it helped heal his daughter’s kidney tumour and treat his son’s autism.
Juicy Fields also had a stand at the Plant Medicine Week conference in Malta earlier this year and even sponsored an official after-party at Suq tal-Belt.
The company was extremely ambitious, telling investors it intended to capture 1.5% of the global medical cannabis market share and be able to tap into 350,000 square metres of land by 2025, up from the 75,000 square metres it claimed to have access to in 2021.
“For the long term, 10 years or more, the plan is to become the world brand number one — cannabis products with a high THC content — oils, vapes, dry flowers, capsules, suppositories, tea, and edibles. Also, we are planning to open medical centers around the world,” it added.
However, in recent weeks, the edifice appeared to start crumbling, with investors reporting blocked withdrawals, social media rumours circulating that the whole thing may have been an exit scam, and authorities in Spain, Germany and the Netherlands alerting potential investors.
El País Financiero recently reported that Juicy Fields was a “textbook exit scam” and that hundreds of millions of dollars are estimated to have been defrauded from investors.
Users also detected $17 million vanishing from a blockchain wallet linked to Juicy Fields within 48 hours, with the company allegedly subdividing large amounts and spreading them to other wallets to make it hard to keep track of the movements.
When crunching the numbers, El País noted the improbability of the scheme’s efficacy. Data from June shows Juicy Fields had over 500,000 e-grower accounts, some of whom were ALT accounts, each of whom could invest up to €180,000.
Juicy Fields claimed to have just under 80,000 square metres of land on which to develop their cannabis crops, which would mean that if every user had a single plant, the company would need to grow and harvest six plants per square metre, an impossible figure.
E-growers who poured thousands of money into the scheme, including a Maltese household who is believed to have invested a whopping €100,000, have now been left high and dry, and Spanish investors are planning a class action lawsuit.
So why did so many people buy into the concept?
Juicy Fields promised people a chance to jump on the train of the next major global industry, with beginner investments as low as €50, and did so in a particularly professional manner.
They attended international conferences, side by side with major players in the industry, and ran an extensive advertising campaign, which included running sponsored articles and using influencers to promote the scheme.
They published a detailed informational booklet, complete with the locations of their plantation partners, and sometimes organised trips to these fields.
E-growers also defended the scheme organically, publishing proof of payment to allay fears of new investors. However, as El País pointed out, Ponzi schemes originally do pay very well, with original investors receiving money paid by newer ones as the “pyramid” is being built.
It is only when the influx of new investors dries up or when the owners fold that the entire system collapses.
Cover photo: Left: Daniel Gauci (Photo: Instagram – the_gentlemansmoker), Right: Stock image
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